US Close Dow -0.43% S&P -0.38% Nasdaq -0.58% Russell -0.45%
U.S. equities retreated from record highs on Thursday as investors took some profits following a largely uninterrupted two-month rally.he tech-heavy Nasdaq (-0.6%) underperformed as technology shares faced particularly heavy selling.More likely, however, the Senate's unveiling provided a convenient excuse for investors to take some money off the table following yet another record high run for the major U.S. indices. All three major averages finished the prior session at fresh all-time highs and have added between 5.0% and 7.6% since September . Shares of 21st Century Fox (FOXA 28.70, +0.61) jumped 2.2% after the media giant reported better-than-expected earnings and sales for its fiscal first quarter. Peers like Walt Disney(DIS 102.68, +1.50), CBS (CBS 58.08, +0.83), and Viacom (VIAB 24.78, +0.48) moved higher in sympathy, adding between 1.5% and 2.0%.
Macro :
- EU Seeks Feedback on Bad-Loan Provisioning Rules for Banks
- MiFID Research Rules Impact to Be ‘Modest and Manageable’: KBW
Keep an eye on :
- MT NA : ArcelorMittal Third Quarter Ebitda 2.1% Above Estimates
- ATC NA : Altice NV Names Dexter Goei CEO; Michel Combes Resigns
- ALV GY : Allianz Third Quarter Net Income Beats Estimates
- COFB BB : Cofinimmo Nine Month Adjusted EPS Misses Estimates
- CWC GY : Cewe Stiftung Third Quarter Sales Meet Estimates
- DIS US : Disney 4Q Adjusted EPS Misses Est.; Shares Fall 3.9%
- EUCAr FP : Hertz 3Q Adjusted EPS Beats Est.; Shares Rise 10.8%
- FCI IM : Fincantieri Nine Month Revenue EU3.57 Bln
- FNTN GY : Freenet Third Quarter Revenue Beats Highest Estimate
- LEG GY : LEG Immobilien Nine Month FFO I EU226.3 Mln
- LEO IM : Leonardo Nine Month Revenue EU7.98 Bln, Leonardo’s Profumo: Delivering on FY Guidance Will Be Tough
- SIE GY : Siemens Downgraded to Hold at Nord/LB; PT 125 Euros
- LSE LN : TCI Requests LSE Shareholder Meeting Over CEO Departure
- SPIE FP : Spie 3Q Ebita Rises 7.9%; Co. Confirms FY Margin Outlook
- TLG GY : TLG Immobilien Resolves on Cash Capital Increase, TLG Immobilien Placement Price Set at EU19.70/Shr
- FP FP : Total Looking at New Pakistan Gas Plans as GEIL Project Stalls
- VK FP : Vallourec 3Q Ebitda Beats Estimate; Ups Ebitda Target
- VOw3 GY : EPA Proposes Repeal of One Part of Heavy Trucks Efficiency Rule
>>> Up
* Drillisch Upgraded to Buy at Jefferies; PT 71 Euros
* Hyatt Upgraded to Buy at Berenberg
* Steinhoff Upgraded to Neutral at Goldman; PT 3.80 Euros
>>> Down
* AstraZeneca Downgraded to Sell at SEB Equities
8 Leonardo Downgraded to Neutral at Natixis
* Leonardo Downgraded to Neutral at JPMorgan; PT 15 Euros
- PSM GY :
* Ultra Electronics Downgraded to Sell at Berenberg
>>> Initiation
* Alfa Financial Software Holdings Initiated at Berenberg With Buy
* dormakaba Initiated at HSBC With Buy; PT 1,170 Francs
* Pirelli Initiated at HSBC With Hold; PT 7.50 Euros
>>> Call
Asia Mid-Session Update: Nikkei 225 remains volatile amid options settlement; Traders focus on tax reform writing process in the US
***Asia Summary***
-Following the negative leads from the US session, Asian equity markets opened generally lower. The Nikkei 225 has remained volatile on the session, following the trading action seen on Thursday. November options for the index settled at 22,531.
-Large banks in Japan are generally weaker, ahead of their earnings reports which are expected starting next week. The TOPIX Securities brokers index has dropped over 1%.
-There has been some weakness in Japanese tech names, after the S&P 500 Technology sector declined by over 0.7% on Thursday.
-Shares of Toshiba have declined by over 4%, following reports that the company is considering raising capital. Also, in the tech sector Softbank has declined by over 1.5%. Bucking the trend, semiconductor firm Sumco has gained over 8%, after reporting its financial results and outlook. In Hong Kong, the Hang Seng Information Technology index is higher by over 0.5%.
-At the same time, the Hang Seng Energy index has declined by over 0.4%, while Australia’s ASX 200 Energy index has dropped over 1%. In the materials space, BHP has declined by over 2% and the overall ASX 200 Resources index is lower by more than 1.3%.
***Key economic data***
-(AU) RESERVE BANK OF AUSTRALIA (RBA) QUARTERLY STATEMENT ON MONETARY POLICY (SOMP): LOWERS INFLATION FORECASTS THROUGH 2019: GDP GROWTH FORECASTS LITTLE CHANGED; Sees sub 2% core inflation until mid-2019 (**Note: RBA has a 2-3% target range for inflation)
***Speakers and Press***
China
-(CN) China Finance Ministry: To expand corporate tax rate cuts for high tech services firms nationwide
Ford: To export ~$10B in vehicles and auto parts from North America to China
- (CN) China to remove foreign ownership limit in domestic banks; raises the foreign stake ceiling in brokerages to 51%; To raise foreign stake ceiling in life insurance companies to 51%; o also, raise the foreign stake ceiling in fund management and futures companies
Other
-(JP) Nikkei 225 Nov options settle at 22,531
-(NZ) New Zealand Finance Min Robertson: Dual RBNZ mandate may see looser policy in some instances, central bank has role to play in maximizing employment; Expanded RBNZ monetary policy committee won't be a 'circus'; Government committed to 1-3% inflation band; RBNZ's 2% inflation focus could be up for discussion.
-(US) Joint Tax Committee: US Senate Tax Proposal is within $1.5T ceiling on deficit expansion
-(US) The Senate tax plan is said to just meet the $1.5T budget limit and the plan is expected to cost $1.496T over 10 years, according to a financial press report.; The report adds that the plan would repeal the interest deduction on home equity loans and eliminate deductions for personal exemptions.
***Asian Equity Indices/Futures (00:30ET)*** - Nikkei -0.9%, Hang Seng +0.2%, Shanghai Composite flat, ASX200 -0.3%, Kospi -0.3%
- Equity Futures: S&P500 flat ; Nasdaq -0.1% , Dax +0.1% , FTSE100 +0.1%%
***FX ranges/Commodities/Fixed Income (00:30ET)*** - EUR 1.1642-1.1654; JPY 113.26-113.51; AUD 0.7664-0.7689; NZD 0.6920-0.6957
- Aug Gold -0.2% at 1,285/oz; Aug Crude Oil -0.2% at $57.05/brl; Sept Copper -0.2% at $3.085/lb
- GLD SPDR Gold Trust ETF daily holdings flat at 843.1 metric tons
-(CN) PBOC sets yuan reference rate at 6.6282 v 6.6325 prior(CN) PBoC OMO: CNY80B v CNY40B injected in 7, 14 and 63-day reverse repos prior; Net injection CNY50B
- (AU) Australia sells A$900M in 2.75% Nov 2027 bonds, avg yield 2.6201%, bid to cover 3.46x
- (NZ) New Zealand sells NZ$100M in Sept 2040 inflation-indexed bonds, avg yield 2.1550%, implied bid to cover 3.01x
***US markets on close: Dow -0.4%, S&P500 -0.4%, Nasdaq -0.6%, Russell -0.5% ***
- Best Sector in S&P500: Energy +0.3%
- Worst Sector in S&P500: Industrials -1.3%
- At the close: VIX 10.50 (+0.72pts); Treasuries: 2-yr 1.637% (-1bp), 10-yr 2.338% (flat), 30-yr 2.814% (+2bps)
***US Market Summary***
-US stocks opened under notable pressure as a variety of asset classes exhibited signs of modest liquidation. The VIX bumped up ~15% and bond yields rose as equity markets moved lower. Consternation surrounding Brexit negotiations and a delay in corporate tax cut implementation in the Senate tax bill appeared to be the underlying current, along with an onslaught of corporate debt/equity issuance announcements ahead of year end. The Dollar index fell as the Senate tax bill details circulated, but as the day wore on, markets pared losses a bit following comments from some senators that the final bill could still include an immediate corporate tax cut.
***US Afterhours Movers***
-HTZ Reports Q3 $1.42 v $1.47e, Rev $2.60B v $2.58Be; International car rental rev $728M, +7% y/y; +11.4% afterhours
-JWN Reports Q3 $0.67 v $0.63e, Rev $3.63B v $3.60Be; Narrows FY17 $2.85-2.95 v $2.95e, Rev +4%, SSS approx ~0% (prior FY17 $2.85-3.00, Rev +4%, SSS ~0%); -3.2% afterhours
After Hours Summary: HTZ +11%, NVDA +3%, DIS +1% higher and PBYI / TTD -10%, JWN -2% lower following earnings/guidanceAfter Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: RGSE +18.9%, BLFS +17.5%, OMER +12.8%, HTZ +10.6%, IMMU +9.2% (also to appoint Michael Pehl as President and Chief Executive Officer, effective December 7), ZSAN +7.1%, AVID +6.4% (light volume), ANY +5.7%, SNOA +5.5% (thinly traded; also files for $75 mln mixed securities shelf offering), CATB +4.8% (light volume), AYX +4.6%, SGYP +3.7%, TRXC +2.8%, NVDA +2.9%, DDS +2.4%, ENDP +1.8%, SGMO +1.2%, KLDX +1%, DIS +0.8%
Companies trading higher in after hours in reaction to news: DVAX +15.2% (announces the FDA has approved HEPLISAV-B for prevention of Hepatitis B in adults), ATOS +10.5% (Iroquois Capital Management discloses 9.01% passive stake) THS +4.3% (ticking higher; will webcast Investor Day presentation on Monday November 13 - will discuss the the strategy, operations and TreeHouse 2020 initiatives), CAR +4.1% (following HTZ results), MDR +1.8% (announces a 'major' contract award from a Middle East customer), HRTX +1.7% (announces FDA approval of CINVANTI injectable emulsion, for intravenous infusion), WDC +1.6% (to resume potential repurchases of its common stock under a previously approved $5 bln repurchase program by its board), PANW +1.2% (rebounding after closing 9+ pts lower), AMD +0.9% and XLNX +0.8% (following NVDA results), BABA +0.5% (Third Point increased stake)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings/guidance: KONA -20.9%, BIOC -19.4%, RELY -17.6%, LPTH -15%, PBYI -10.4%, TTD -10%, TPC -7.3%, RDFN -6.7%, AIRG -6.1%, XON -3%, JWN -1.8%, EFX -1%
Companies trading lower in after hours in reaction to news: ARLZ -5.8% (light volume; files for $100 mln mixed securities shelf offering), SOI -1.8% (prices 7 mln share Class A common stock offering at $15.75 per share -- 4 mln by holders), GOLF -0.4% (files for 9,165,542 share common stock offering by the selling shareholder)