>>> US Gapping down


Gapping down
In reaction to disappointing earnings/guidance:

  • HNI -19.8%, INVE -15%, WHR -9.7%, LOGI -6.3%, MAS -4.5%, WDR -3.9%, BIIB -2.9%, NVS -2.2%, R -2.2%, CNC -2%, JBLU -1.9%, PHM -1.4%, ZION -1.2%, LMT -1.1%, RMBS -0.7%, EDU -0.5%, RF -0.5%, SAH -0.5%

Other news:

  • IMDZ -13.5% (commences 16 mln common stock offering)
  • CRBP -7.4% (commences common stock offering)
  • QURE -2% (commences 5 mln common stock offering)
  • CWH -1.9% (files 6.7 mln share Class A common stock offering by selling stockholders; also provided YTD estimates -- 9-mo revs of $3.38-3.4 bln, income from ops of $314-318 mln)
  • FRC -1.6% ( to sell 2 mln shares of common stock in an underwritten public offering)
  • SNES -1.4% (following 70%+ surge higher)
  • HTGM -1.1% (after seeing afternoon momentum - ending the day up 25%)
  • AUPH -1% (Robert W. Duggan disclosed lowered active stake)

Analyst comments:

  • VECO -3.4% (downgraded to Sector Weight from Overweight at KeyBanc Capital Mkts)
  • RHT -2.2% (downgraded to Underperform from Neutral at BofA/Merrill)
  • TERP -2.2% (resumed with a Underperform at BofA/Merrill)
  • HFC -1% (downgraded to Underperform from Neutral at Macquarie)
  • HBI -0.9% (downgraded to Perform from Outperform at Oppenheimer)
  • GE -0.5% (downgraded to Underperform at Oppenheimer)

>>> US Gapping up


Gapping up
In reaction to strong earnings/guidance:

  • KNL +13%, GPK +8.6%, CAT +6.7%, PII +5.7%, GM +4.2%, HMST +3.8%, CR +3.4%, CLB +3.4%, CIT +3.2%, AMTD +3%, CAJ +2.9%, LLY +2.7%, FCAU +2.5%, MMM +2.5%, SWK +1.9%, YNDX +1.6%, PCAR +1%, UTX +0.7%

M&A news:

  • HES +2.9% (Hess to sell its interests in offshore Equatorial Guinea to Kosmos Energy (KOS) and Trident Energy for $650 million)

Other news:

  • CBIO +10.6% (Catalyst Biosciences and Mosaic Biosciences enter collaboration agreement)
  • VKTX +8.6% (presents results from an eight-week study of VK2809 )
  • VICL +5.7% (pursuing early stage development of a novel treatment for chronic hepatitis B virus based on its DNA and lipid-delivery technologies), EGO +5.2% (after 25% decline on mine update)
  • ALXN +5.2% (receives FDA approval for Soliris)
  • TNDM +4.6% (continued strength; also Armistice Capital discloses 4.99% passive stake)
  • IPXL +3.2% (received final FDA approval on its Abbreviated ANDA for a generic version of Renvela (sevelamer carbonate) tablets, 800 mg; co has immediately initiated commercialization activities)
  • DEST +3.1% (continued strength)
  • ZEAL +2.4% (granted orphan drug designation by the FDA for glepaglutide for the treatment of short bowel syndrome)
  • INO +2.2% (announces results of a study in which a DNA vaccine provided 100% protection for non-human primates challenged with a lethal dose of the Lassa fever virus)
  • DE +1.6% (in sympathy with CAT)
  • ICPT +1.4% (announces positive results from phase 2 AESOP trial evaluating OCA for treatment of patients with primary sclerosing cholangitis - met the primary endpoint)
  • CNHI +1.3% (in sympathy with CAT)
  • SPPI +1.2% (initiated with a Buy at Guggenheim)

Analyst comments:

  • CRIS +8.9% (initiated with a Buy at Guggenheim; tgt $7)
  • SCYX +8.2% (initiated with a Buy at Guggenheim; tgt $6)
  • PRTY +2.7% (upgraded to Outperform from Market Perform at BMO Capital Markets)
  • CTMX +2.5% (initiated with a Overweight at Cantor Fitzgerald)
  • HAS +1.6% (upgraded to Overweight from Equal Weight at Barclays)
  • DK +1.3% (upgraded to Outperform from Neutral at Macquarie)
  • PQG +0.8% (initiated with a Buy at Nomura, among others)
  • CELG +0.7% (initiated with a Buy at Guggenheim)

>>> Pre AMrket

bofA-ML
CARILLION-New financing & deferral of some pension contributions.(50-55).+20-30%
MORPHOSYS - FDA Breakthrough designation for antibody MOR208.(77.4-81.1)..+5-10%
AMS -Q3 sales €262.6m,EBIT margin 13.25%. Confirm guidance.(68.9-70.19)....+5-7%
SERCO - Acquires BTP systems for $20m.To be done by y/e and accretive.(119.7)+3%
HUNTING - continued improving trends in some US onshore markets (470p).......+3%
COVESTRO - Q3 EBIT beat, buyback of up to €1.5bn.Positive outlook(73.56).....+2%
WHITBREAD - Premier Inn LfL 3.6%,Restaurants 1.1%,Costa 0.6% (3980-4020)...+1-2%
LOGITECH - Q2 sales USD634m (c622m), EBIT 60m (c54m),confirms FY...(36.98)...+2%
COMMERZBANK - FT says hires GS/Rothschild to advise on potl takeovers(11.65).+2%
STJ - AUM £85.7bln vs cons £85.95,Net flows £2.36bln,reit targets (1182).....+1%
NOVARTIS - Sales $12.41b,core EBIT 3.38b,group outlook reaffirmed..(86)......+1%
SCHINDLER - 9m orders CHF8.08bn,EBIT 860m,FY rev growth 3%-5% - unch.(225.23)+1%
MINERS - Small better in Oz, Copper attempts to re-test ytd highs..........+0.5%
ANGLO - Production solid.Diamonds, Iron ore, Copper strong.(1451.22).......+0.5%
BUNZL - Rev growth (cFX) of +11% yoy,+5.5% org and 6% from M&A.(2256p)......UNCH
SAIPEM - 3Q17 rev €2.3bn 6% below cons. EBIT 8% beat. Guidance FY 17 unch...UNCH
RANDSTAD - Q3 results IN LINE; growth in early Oct similar to Q3......(54.7)UNCH
ATOS - Q3 revs bang in-line,guidance reit driven by France..................UNCH
BASF - Q3 3% beat all on cyclical.Mix poor.Driven by chems/O&G.Been strong..UNCH
SWEDBANK - Solid quarter on NII but capital miss a slight disappointment....UNCH
ESSILOR - Q3 sales inline with consensus at 5.9% cFX.Been strong. (99.99.....-1%
LUXOTTICA-Q3 rev growth 0.8%.50bp hurricane impact.Guidance optimistic.(45.8)-1%
BNP/CRED AG - FT reports BNP/Cred AG most likely suitor for CBK..............-1%
DB1-Frankfurt court refuses approve settlement btwn prosecutors & CEO(91.25).-1%
CARPETRIGHT - H1 profit to be lower than prior year. LFL sales rise 0.8%(176)-2%
BOLIDEN - EBIT light, +32% YoY but looks about 20% MISS.CEO to retire(298.6).-3%
FUCHS PETROLUB-Cuts EBIT forecast to'just below or flat'YoY from +1-5%(47.45)-5%

CS

AMS +7-10% Q3 sales of €263m cons €279m, Q4 guidance well above
Anglos UNCH Iron ore, coal and diamonds slightly better, platinum worse
Atos -1% Q3 Sales EU 3.0bln. Q3 Orders EU 2.89bln. Confirms 2017
BASF R Q3 Rev EU 15.3bln est EU 15.0bln, Maintains 2017
Boliden -7-10% Q3 1.74bn Cons 2.37m, higher costs, CEO change
Bunzl M/P Rev growth inline, performance inline with expectations
Caxiabank +1% Low quality beat driven by Trading, capital better
Covestro +3% Q3 Sales Eu 3,5bn vs cons 3,4bn, Reiterates FY17
Dialog +2-3% Positive read from AMS numbers
Electrolux -3-4% Negative read from Whirlpool warning after US close
Essilor M/P 3Q sales 1.75bln con 1.76bln, confirms guidance
Fuchs -5% Cut guidance - see's Ebit just below last year
Flow Traders -2% Adj ebitda €7.6m vs cons €8.8m, tax provisions help net
GKN M/P Announced in numerous papers re: merger spec
Gurit M/P Guiding to low single digit rev growth, cons +1.4%
Huber -2-3% Orders slightly ahead, sales guidance light
Hunting +2-3% Revs and EBITDA on track, Capex under control
Idorsia M/P Q3 op loss CHF68m is slightly better than cons
Leoni -3-4% CEO Dieter Bellé agreed on his early retirement
Logitech +0.5% Strong Q2 FY18 results, guidance unchanged, cashflow weak
Luxottica +1-2% 3Q net sales EU2.15B, est EU2.17B, confirms outlook
Miners +0.5% Copper +1.55%, Brent UNCH, Iron Ore +0.75%, China UNCH
Morphosys + 0% FDA Breakthrough Therapy designation for antibody MOR208
Novartis UNCH Q3 Core EPS $1.29 est %1.25. 2017 Outlook confirmed
Randstad +0.5% EBITA 287.5m vs 288m cons, EPS 1.10 vs 1.11
Schindler +1-2% Organic growth ahead, orders 2.4% ahead of cons
St James +1-2% Net inflows of £2.36bn, FUM to £85.7bn
Swedbank -1-2% Slightly ahead, lower loan losses, capital 23.9 vs 24.4%
Tieto +1% 3Q op profit 41.2mln cons 39.4mln, keep FY outlook
Whitbread -1% 1H revs GBP1.67B, est GBP1.67B, LFL's weaker, confirms FY
Worldline M/P 3Q revs Eu386m cons 405m, Confirms FY tgts

Investec
UK
* ANGLO'S-Q3.In line to sml beat.Higher Kumba g'ance see risks to upside....+1%
* BLOOMSBURY-H1.#'s ahead, children strong & Tax better.U/G FY18&19 EPS...+1-2%
* BUNZL-Update.Rev +11%. Sees further acquisition in coming months..........+1%
* CARILLION-Update.Sale of Healthcare facilities(£50.1m)New credit line..+5-10%
* CARPETRIGHT-Update.H1 below last yr.Sees stronger H2. FY within range.....-1%
* GB GROUP-Update.+tive pre-close, upgrading HY operating pft targets.......+2%
* HUNTING-Q3.Continued strengh, FY Rev $700m. Sees modest PTP.............+2-3%
* INTL.PERS.FNCE-Q3.#'s in line, maintains FY g'ance. Weaker outlook........-1%
* MCBRIDE-Update.FY remains on track but reits will be H2 weighted.Tra&Arr..-2%
* SERCO-CLLN HC acq's(£50.1m) & BTP Sysytems for $20m. New Debt facilities..+1%
* ST JAMES'S PL.-Q3.FuM £85.7b, looks ahead. Confident outlook..............+1%
* TELIT COMMS-Completes Certification for LTE Cat 1,will enable ramp up...+3-5%
* VECTURA-Breezhaler continues to deliver strong U/L growth.................+1%
* WHITBREAD-H1.Rev I/L PTP ahead. Maintains full year outlook..............+1/2%
EU
* AMS-Q3 rev 6% miss but Q4 guidance more than offsets (12% ahead of cons)...+6%
* ATOS-Q3 rev in line, +2.5% organically, confirms targets, strong y'day.....U/C
* BASF-Q3 revs 2% beat, ebit in line, keeps FY growth forecasts..............U/C
* BOLIDEN-big Q3 miss,prodn disturbances,lower grades,CEO leave mid 2018.....-2%
* CAIXABANK-Q3 NII in line. Domestic issues dominate here, not no's..........-1%
* COMMERZBANK-said to hire Goldman, Rothschild as advisers (FT)..............+1%
* COVESTRO-Q3 sales 2% ahead, net inc and ebitda well ahead, reits FY........+2%
* DOMETIC-Q3 organic rev +11%, ebit well ahead, committed to outlook.........+2%
* ELECTROLUX-Whirlpool cuts FY view, shares -6.5% after hours................-2%
* ENEL-Q3 op data not great but likely trades ok ahead of results and CMD....-1%
* ESSILOR-Q3 sales small miss, reits FY......................................-1%
* FUCHS-9m no's out, cuts FY ebit est to small down vs +1%-5%................-4%
* IDORSIA-Q3 loss better than expected, FY guidance in line/slightly better..+1%
* LOGITECH-Q2 sales 1% beat, reaffirms FY....................................-1%
* LUXOTTICA-Q3 rev 1% miss, confirms FY outlook, likely low end..............-2%
* NOVARTIS-Q3 eps 3% beat,confm o/look,giving Alcon time to turn round(-ive).+1%
* RANDSTAD-Q3 rev +9% organically, sees Q4 margin stable, strong into........U/C
* SAIPEM-Q3 miss but FY guidance in line/slightly ahead?, weak into..........+2%
* SCHINDLER-9m no's,FY rev guidance looks in line,profit ahead, strong into..U/C
* SWEDBANK-no's and outlook in line, been weak into numbers..................+1%

MS
LUX IM -1% WEAK Q3 SALES IN-LINE WITH LOW CONS. EXPECTATIONS; RETAIL LFL -5.1% v CONS -3.5% WILL BE TAKEN NEGATIVELY.
RAND NA -1% ORG GROWTH BEATS CONS BY 1% BUT FCF WEAK, WORKING CAPITAL HIGH; OUTLOOK SEES CONTINUATION OF VOLUME GROWTH BUT TOUGHER COMPS IN Q4. TRAVEL AND ARRIVE.
EI FP +1% ORG SALES GROWTH 2.5% VS 2.6%, US HURRICANES SEEN AS ONLY HAVING MINOR IMPACT TO FY GROWTH (50bp). UPDATE ON LUX MERGER EXPECTED ON CALL.
BAS GY +0.5% SALES BEAT (1.5%), ADJ EBIT BEAT (3%), EXPECTS GROWTH IN SALES. STRONG INTO NUMBERS
SWEDA SS UNCH 4% PPOP BEAT WITH STRONG NII & COSTS BUT BALANCED BY 50BPS CET1 MISS

Macquarie
* Bunzl BNZL- Inline, more acquisitions planned. Unch
* Carpetright CPR- Keeps FY guidance but reliant on strong H2, UK & European sales volatile but recently encouraging; -2-3%
* Carillion CLLN- New Credit facilities agreed & disposal of Healthcare Business for £50.1m. Updated Guidance unchanged, continues to assess options for capital structure……+20% ?
* Hays- Positive read-X from RAND NA, +0.5%
* Hunting HTG- Expects FY Rev’s of $700m top end of est’s, Ebitda top end also. +3-5%
* Kosmos KOS- Buys Hess’s interests in Gulf of Guinea fields for $650m of which Kosmos pays $240m. +1%
* Saga- Chairman Andrew Goodsell retiring in 2018. Unch
* Serco SRP- Buys US defence engineering services firm for $20m & Healthcare Division from Carillion for £50.1m. Unch
* St. James STJ- FUM £85.7bn slightly ahead Macq est $85m. confident outlook. Unch
* Whitbread WTB- Keeps FY guidance, cautious on current environment; +1%
Jefferies
NOVN called +1%.. - pretty decent quality, should be up rel today
MOR GY +10% aft-hrs... received FDA Breakthrough Therapy designation for its antibody MOR208
LEONI -3% aft-hrs.. CEO to retire early on January 31, 2018
FUCHS PETROLUB -5% after-hrs.. warning.. now sees FY17 EBIT 'just below or flat' yoy from up 1-5%

>>> What to look at today - 24th of October 2017

Dow -0.23% S&P -0.34% Nasdaq -0.64% Russell -0.72%
US Market closed lower but SPX didn't filled the gap (2562.46). GE dropped 6.3% after MS & UBS dwg. On a positive note, the heavily-weighted financial sector (-0.1%) held up relatively well, finishing near the top of the day's leaderboard. The countercyclical consumer staples (-0.1%) and utilities (+0.1%) sectors also put together a relatively positive showing. Following Monday's slim victory, the utilities space leads all other groups for the month of October with a month-to-date gain of 3.5%. US After hours KNL +12% higher and HNI -16%, INVE -15%, WHR -6.5% lower following earnings/guidance. Asian Market, Following the negative leads out of the US, Asian equity markets opened mostly lower. The Nikkei 225 opened down by 0.1%, amid weakness in shares of Fast Retailing. However, the index has since pared losses as it attempts to gain for the 16th straight session. Japanese ‘mega-banks’ have added on to their post-elections gains. Strength has also been seen among steel makers and trading companies. Japanese electronic parts makers are trading mostly higher, after it was reported that Q2 orders for the sector may have risen by 17%. Hang Seng opened the session lower, as furniture products firm Man Wah Holdings has lost over 15%, after cutting its forecast, primarily due to the appreciation of the Chinese yuan. The index has since pared losses. The Property and Construction sub-index has risen by over 0.5% on the session.

Nikkei +0.50% Hang Seng -0.58% CSI Shanghai +0.10% Shenzen -0.45%

Eur$ 1.1762 CNH 6.6323 CNY 6.6326 JPY 1.3215 CHF 0.9895 RUB 57.5381 WTI$ 51.99 +0.17%

S&P +0.03% EuroStoxx -0.22% FTSE -0.20% Dax -0.9% SMI -0.08%

Macro :
- China’s Xi Joins Mao, Deng, as Leaders Credited in Constitution

Keep an eye on :
- AAD GY : Amadeus Fire to Name Robert von Wuelfing CEO
- ACS SM : ACS Is Said to Not Deduct Abertis Div From Cash Bid: Expansion
- AKER NO : Aker BP Buys Hess Norge for Cash Consideration of $2B
- AMS SW : AMS Sees Fourth Quarter Revenue EU440 Mln To EU480 Mln, AMS Strong 4Q Guidance More Than Offsets 3Q Results: Baader
- STS IM : Ansaldo Says Storstockholms Lokaltrafik Asked for Partial Refund
- ATO FP : Atos 3Q Sales Rise LFL 2.5% to EU3.0B
- BAS GY : BASF Third Quarter Ebitda Beats Highest Estimate
- BT/A LN : BT is Said to Plan Cutting One in Seven German Jobs: FAZ
- CLLN LN : Carillion Signs New Debt Facilities, Agrees Unit Sale to Serco
- CABK SM : Caixabank Board Approves 2017 Interim Dividend
- COV1 GY : Covestro Third Quarter Ebit Beats Highest Estimate
- DB1 GY : Deutsche Boerse: Court Doesn’t Approve Closure Probe of CEO
- FPE3 GY : Fuchs Petrolub Nine Month Revenue EU1.86 Bln, Fuchs Petrolub Ebit Consensus Seen Down 3% on Warning: Baader
- GEN DC : Genmab/J&J’s Darzalex IP Litigation Risk Remains Low, Citi Says
- HSBA LN : HSBC Says Foreigners Ready for MSCI’s ‘Inevitable’ Saudi Upgrade
- KER FP : 3Q: Gucci Shows No Signs of Slowing
- KOS LN : Kosmos Energy Buys Hess Corp. Assets in Equatorial Guinea
- LBK SM : Liberbank 3Q Loss EU337M: NPLs Down EU813M in 3Q
- LUX IM : Luxottica 3Q Rev. EU2.15b Vs Est. EU2.17b; FY Outlook Confirmed, Luxottica’s Vian Sees 2017 Results Likely at Lower-End of Range
- LNSX GY : Sixt Leasing Is Said to Have Rebuffed HgCapital Buyout Approach
- MDM FP : Maisons du Monde Lifts FY Growth Outlook After 3Q Sales Jump 17%
- MDLZ US : Mondelez Options Among the Most Active After Upside Call Trade
- NOVN VX : Novartis CEO Doesn’t See U.S. Generics Price Pressure Easing, Novartis CEO: Alcon Started to Turn Around in Last 2 Quarters
- POM FP : Plastic Omnium 3Q Sales Rise 5.5% to EU1.534b
- SPM IM : Saipem Third Quarter Adjusted Net Misses Estimates
- SCHP SW : Schindler FY Estimates Set to Increase After 3Q Beat: Goldman
- SRG IM : Snam to Invest EU5 Bln Until 2021, CEO Tells Boersenzeitung
- TIE1V FH : Tieto 3Q Adj. Operating Profit, Sales Beat Ests., Keeps Outlook
- UCG IM : UniCredit Says to Release Prelim. 3Q Results Oct. 24 Pre Open
- WTB LN : Whitbread First Half Revenue Matches Estimates

>>> Europe : Brokers Upgrades & Downgrades - 24th of October 201

>>> Up
* Exor Raised to Buy at Kepler Cheuvreux, PT EU59.60
* Mapfre Raised to Neutral at BPI, PT EU2.90
* RSA Raised to Overweight at JPMorgan, PT 725p
* Spar Nord Raised to Buy at Handelsbanken, PT DKK95

>>> Down
* Admiral Cut to Neutral at JPMorgan, PT GBP19.80
* Beni Stabili SpA SIIQ Cut to Neutral at Exane, PT EU0.74
* Carlsberg Cut to Reduce at Handelsbanken, PT DKK745
* Esure Cut to Underweight at JPMorgan, PT 290p
* Lookers Cut to Hold at Berenberg
* Martela Cut to Reduce at Inderes, PT EU8.10
* Pendragon Cut to Hold at Berenberg
* Philips Cut to Hold at Kepler Cheuvreux, PT EU36
* Premier Cut to Sector Weight at Keybanc
* Roche Cut to Hold at Berenberg

>>> Initiation
* Adidas New Neutral at Wedbush, PT EU195
* Frey New Hold at Kepler Cheuvreux, PT EU27
* Pfeiffer Vacuum New Outperform at MainFirst, PT EU150

>>> Call

>>> Asian Update

Asia Mid-Session Update: NZ$ weaker as new Govt outlines priorities; Markets await earnings results

***Asia Summary***
-Following the negative leads out of the US, Asian equity markets opened mostly lower. The Nikkei 225 opened down by 0.1%, amid weakness in shares of Fast Retailing.
-However, the index has since pared losses as it attempts to gain for the 16th straight session. Japanese ‘mega-banks’ have added on to their post-elections gains. Strength has also been seen among steel makers and trading companies. Japanese electronic parts makers are trading mostly higher, after it was reported that Q2 orders for the sector may have risen by 17%.
-In the tech sector, Rakuten has declined by over 2% following a cautious broker note. South Korean chipmaker Hynix has declined by over 2%, after gaining over 4% in the prior session.
-Banks in South Korea have rebounded on today’s session, following the weakness seen yesterday and rise in government bond yields. Korea’s 3-year bond yield has risen over 3bps on the session.
-Energy companies in Australia are generally trading lower following yesterday’s decline in oil prices. Shares of Santos have declined by over 0.5%. Japara Healthcare has gained over 7% in Sydney, after Moelis Australia disclosed an ~10% stake.
-The Hang Seng opened the session lower, as furniture products firm Man Wah Holdings has lost over 15%, after cutting its forecast, primarily due to the appreciation of the Chinese yuan. The index has since pared losses. The Property and Construction sub-index has risen by over 0.5% on the session.
-In currencies, the Kiwi has moved between gains and losses, as the new Labour/NZ First coalition government outlined some of its priorities, which include a higher minimum wage, review of the RBNZ’s mandate and a ban on the purchase of existing homes by foreigners.
-Looking, ahead the Aussie has traded slightly higher ahead of tomorrow’s release of Q3 CPI data. Japanese companies expected to report earnings today include Canon and Nidec. Out of China, companies including CNOOC, China CITIC Bank and China Shipbuilding Group may report earnings.
-US companies expected to report today include 3M, AT&T, Biogen, Caterpillar, Chipotle, Corning, GM, Lockheed Martin and McDonald’s. Following Monday’s US equity close, Whirlpool declined by over 6%, after reporting weaker than expected quarterly results and reducing its FY outlook.

***Key economic data***
- (JP) JAPAN OCT FLASH PMI MANUFACTURING: 52.5 V 52.9 FINAL

***Speakers and Press***
Japan
- (JP) Japan Econ Min Motegi: To host next round of TPP talks Oct 30-Nov 1st
- (JP) Japan Fin Min Aso: Markets support Govt's economic policies; Election results saw stocks go up
- (JP) Japan Electronic Parts Makers Q2 Orders +17% y/y to ¥1.57T (quarterly record)- Japanese Press
Korea
- (KR) South Korea, US and Japan start joint missile warning exercise

China/Hong Kong
- (CN) Singapore SGX official: Seeing less China intervention in yuan market since 2016
- (CN) China President Xi ideology to enter the constitution as "Xi Jiping Thought" and elevate him to the same level as Mao and Deng Xiaoping – press
- (CN) China President Xi now included in draft version of amended China Communist Party constitution; Adds Xi Jing Ping thought into charter - Chinese press
- (CN) The gap between China aggregate financing and M2 money supply rise will narrow - Chinese press
- (HK) Hong Kong Monetary Authority (HKMA) said the discount between HKD Hibor and USD Libor is not of concern
Australia/New Zealand
- (NZ) New Zealand Labour Leader Ardern signs coalition agreement with NZ First: You will see significant increase in minimum wage
***Asian Equity Indices/Futures (00:00ET)***
- Nikkei +0.04%, Hang Seng +0.03%; Shanghai Composite +0.08%; ASX200 -0.0%, Kospi +0.2%
- Equity Futures: S&P500 +0.1%; Nasdaq100 +0.1%, Dax +0.1%; FTSE100 +0.1%

***FX ranges/Commodities/Fixed Income (00:00ET)***
- EUR 1.1770-1.1747; JPY 113.49-113.25; AUD 0.7825-0.7807;NZD 0.7004-0.6935
- Dec Gold +0.2% at $1,283/oz; Dec Crude Oil +0.2% at $51.98/brl; Dec Copper +1.3% at $3.22/lb
- USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT 6.6268 V 6.6205 PRIOR
- (CN) PBoC OMO: Injects CNY250B in 7 and 14-day reverse repos v CNY200B injected prior; injects net CNY140B v CNY140B prior (6th consecutive injections, longest since July)
- (TH) Thailand Central bank sells combined THB60B in 3-month and 6-month bonds

***Equities notable movers***
Australia/New Zealand
- ESV.AU Completes ~£15.8M institutional component of entitlement offering; +21%
- MML.AU Reports Q1 gold production 24.9K oz v 23.8K q/q at avg head grade of 6.59 g/t; ASIC $973/oz v $1,180 q/q; +15.6%
- KGN.AU CEO Ruslan Kogan sells 3M shares at A$4.25/shr; -13%

China/Hong Kong
- 606.HK Announces intent to sell COFCO Biofuel and COFCO Biochemical for HK$8.58B; declares special dividend; +8.5%
- 1999.HK Issues profit warning; sees H1 -10% profit y/y – filing; -16.5%

Korea
- 005930.KR Said to consider plan to spend KRW20T on dividends and buybacks in 2017 - South Korean Press

Japan
- 2432.JP Strength attributed to Nintendo's announcement on Animal Crossing; +7%
- 6502.JP CEO: Considering measures if chip unit sale is not completed by the end of March; -0.6%

>>> US After Hours Summary: KNL +12% higher and HNI -16%, INVE -15%, W


After Hours Summary: KNL +12% higher and HNI -16%, INVE -15%, WHR -6.5% lower following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: KNL +12.3%, HMST +3.8% (light volume), CLB +2.6% (light volume)

Companies trading higher in after hours in reaction to news: IPXL +5.1% (received final FDA approval on its Abbreviated ANDA for a generic version of Renvela [sevelamer carbonate] tablets, 800 mg; co has immediately initiated commercialization activities), TNDM +5% (continued strength; also Armistice Capital discloses 4.99% passive stake), SNES +4.1% (continued momentum following 80%+ surge higher), EGO +3.9% (modestly rebounding after 25% decline today), DEST +3.1% (continued strength), ICPT +2.1% (announces positive results from phase 2 AESOP trial evaluating OCA for treatment of patients with primary sclerosing cholangitis - met the primary endpoint), GLW +1.7% (ahead of earnings), AMGN +0.7% (announces top-line results of the Phase 3 A.R.R.O.W. trial met primary endpoint), HBI +0.6% (light volume; initiated after the close with Buy and $29 tgt at Deutsche Bank)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: HNI -16.1%, INVE -15%, WHR -6.5%, RMBS -0.7%

Companies trading lower in after hours in reaction to news: IMDZ -15.4% (commences 16 mln common stock offering), CRBP -4.7% (commences common stock offering), QURE -4.2% (commences 5 mln common stock offering), CWH -3.1% (files 6.7 mln share Class A common stock offering by selling stockholders; also provided YTD estimates), AUPH -3% (Robert Duggan disclosed lowered active stake), FRC -2.1% (to sell 2 mln shares of common stock in an underwritten public offering), ALXN -1% (continued weakness), HFC -0.5% (downgraded at Macquarie after the close), GE -0.4% (downgraded after the close to Underperform from Perform at Oppenheimer)

>>> Dow -0.23% S&P -0.34% Nasdaq -0.64% Russell -0.72%

Closing Market Summary: Winning Streak Comes to an End

Stocks moved lower on Monday, ending a week-long stretch of record finishes. The major indices kept near their flat lines throughout the morning, but tumbled to new lows in the afternoon. The S&P 500 lost 0.4%, while the Nasdaq and the Russell 2000 underperformed, losing 0.6% and 0.8%, respectively. The Dow finished ahead of its peers, but still lost 0.2%.

Earnings season took somewhat of a breather on Monday, but will pick back up Tuesday morning with releases from McDonald's (MCD 163.34, -2.96), 3M (MMM 221.55, +0.23), Caterpillar (CAT 131.68, +0.32), and United Technologies (UTX 120.89, -0.04)--in addition to many other heavyweights.

Still, there were several notable post-earnings movers on Monday, including V.F. Corp (VFC 69.95, +3.57), Seagate Tech (STX 39.35, +4.41), and Hasbro (HAS 89.75, -8.44).

V.F. Corp--which owns apparel brands like Wrangler and The North Face--and disk-drive maker Seagate Tech soared 5.4% and 12.6%, respectively, after reporting better-than-expected earnings and revenues. Conversely, toymaker Hasbro plunged 8.6% after issuing disappointing sales guidance for the holiday season, which overshadowed the company's above-consensus earnings. 

Outside of earnings, industrial giant General Electric (GE 22.32, -1.51) dropped 6.3% after both Morgan Stanley and UBS downgraded GE shares on the heels of Friday's underwhelming earnings report. The S&P 500's industrial sector declined by 0.8%, settling alongside the consumer discretionary (-0.7%) and telecom services (-1.0%) groups at the bottom of the sector standings.

Within the consumer discretionary space, Under Armour (UAA 16.85, -0.63) exhibited particular weakness, losing 3.6%, after the Wall Street Journal reported that co-founder Kip Fulks is taking a sabbatical and that the sportswear manufacturer is considering exiting small sports categories such as tennis and fishing.

On a positive note, the heavily-weighted financial sector (-0.1%) held up relatively well, finishing near the top of the day's leaderboard. The countercyclical consumer staples (-0.1%) and utilities (+0.1%) sectors also put together a relatively positive showing. Following Monday's slim victory, the utilities space leads all other groups for the month of October with a month-to-date gain of 3.5%.

Elsewhere, European equities ticked higher on Monday, evidenced by the Euro Stoxx 50 index, which added 0.1%. However, Spain's IBEX (-0.8%) underperformed after Prime Minster Mariano Rajoy invoked Article 155 of Spain's constitution, which allows the central government to take control of the Catalonia region following its vote in favor of independence. 

In Asia, Japan's Nikkei rose 1.1% on Monday, marking its 15th consecutive advance--and longest-ever winning streak--after the LDP/Komeito coalition kept its super majority following a national election over the weekend. As a result, Prime Minister Shinzo Abe will likely serve another three-year term.

There wasn't much movement in the U.S. Treasury market on Monday, with the benchmark 10-yr yield finishing unchanged at 2.38%. Shorter-dated issues showed relative weakness, sending the 2-yr yield one basis point higher to 1.58%. Meanwhile, the U.S. Dollar Index jumped 0.2% to 93.75.

Investors did not receive any economic data on Monday, and Tuesday's economic calendar is also blank.

  • Nasdaq Composite +22.4% YTD
  • Dow Jones Industrial Average +17.8% YTD
  • S&P 500 +14.6% YTD
  • Russell 2000 +10.3% YTD