Gapping down
In reaction to disappointing earnings/guidance:
In reaction to disappointing earnings/guidance:
- CALM -2.7%
Other news:
- AEMD -38.3% (prices a public offering of an aggregate of 5,454,546 units at $1.10 per unit), BHVN -23.6% (reports topline results from its Phase 2/3 clinical trial evaluating trigriluzole), GNW -10.1% (Genworth Financial and Oceanwide provide update on CFIUS application; joint voluntary notice has been withdrawn), TEUM -9.9% (files for $12 mln mixed securities shelf offering), ACST -9.9% (files for common stock offering of up to US$17.25 mln), ROKU -6.6% (trading lower following last week's strong IPO), JWN -6% (talks to go private may have hit a snag, according to NY Post) TNXP -5.7% (files for 2.1 mln share common stock offering by Lincoln Park Capital Fund), MGM -5.1% (following Las Vegas shooting), WNDW -4.8% (entered into Subscription Agreements with four investors for the purchase/sale of 821,600 units at $3.11/unit for proceeds of $2,555,176), TLND -2.3% (files for $100 mln mixed securities shelf offering and 10,528,483 ADS representing ordinary shares offered by the selling shareholders), WYNN -1.5% (following Las Vegas shooting)
Analyst comments:
- BLUE -4.1% (downgraded to Underweight from Equal-Weight at Morgan Stanley)
- WDC -1.7% (downgraded to Neutral from Outperform at Robert W. Baird )
- STLD -1.4% (downgraded to Neutral from Buy at Longbow)
- FINL -1.1% (downgraded to Neutral from Positive at Susquehanna)
- PEP -0.8% (downgraded to Hold from Buy at Jefferies)
- HCP -0.8% (downgraded to Sell from Neutral at UBS )
Gapping up
In reaction earnings/guidance:
In reaction earnings/guidance:
- QTRH +9.8%
M&A news:
- SNCR +20.4% (remains in discussions with multiple parties regarding potential strategic transaction)
Other news:
- VBLT +17.2% (announces positive outcome in the third and final DSMC review of Phase 3 GLOBE Trial ABUS +12.7% (signs a share purchase agreement with Roivant Sciences for the sale of $116.4 mln of convertible preferred shares), ITUS +11.8% (completes approx. $3.7 mln common stock offering), TRN +11.6% (favorable court ruling),ECYT +11.3% (completes exclusive worldwide license of PSMA-617 from ABX GmbH), SGEN +7% (FDA has granted ADCETRIS (brentuximab vedotin) in combination with chemotherapy for the frontline treatment of patients with advanced classical Hodgkin lymphoma Breakthrough Therapy Designation), DVAX +5.8% (considering options for Hepatitis B drug, according to Reuters), MNKD +5.5% (announces that the FDA has approved an update to the Afrezza prescribing info to include new clinical data that was presented at the American Diabetes Association's 76th Scientific Sessions in June 2016), KTOV +5.1% (FDA has filed and NDA for KIT-302, its lead drug candidate, thereby accepting the NDA for a full review), DRRX +4.5% (announced patent purchase agreement with Indivior UK worth $17.5 mln), PSTI +4% (announces a $7.9 mln non-dilutive grant from the European Union's Horizon 2020 program has been awarded to nTRACKg), OPNT +3.3% (Opiant Pharmaceuticals and Titan Pharma (TTNP) announce collaboration ), TTNP +2.9% (Opiant Pharmaceuticals and Titan Pharma (TTNP) announce collaboration ),AIG +1% (Financial Stability Oversight Council rescinded nonbank financial company designation), .
Analyst comments:
- ZYNE +4.8% (upgraded to Overweight at Cantor Fitzgerald)
- ALNY +3.8% (upgraded to Buy from Neutral at Goldman)
- GNRC +2.8% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)
- STX +2.1% (upgraded to Buy from Hold at Craig Hallum )
- TRUE +2% (upgraded to Equal-Weight from Underweight at Morgan Stanley)
- CAVM +1.6% (upgraded to Overweight from Sector Weight at KeyBanc Capital Mkts)
- ANF +1.5% (upgraded to Hold from Sell at Argus)
- AKAM +1% (upgraded to Buy from Neutral at Guggenheim )
- ABBV +0.9% (upgraded to Outperform from Mkt Perform at Leerink Partners)
Fed’s QE unwind threatens to unleash US bank competition
CEOs expect demand for customer deposits to grow as central bank withdraws stimulus
The Federal Reserve’s plans to reverse years of quantitative easing threaten to drain deposits from the US banking system and could usher in a new era of competition for customer accounts, according to bank executives, economists and analysts.
Deposit levels at US banks have soared by two-thirds since 2009 to record highs, in part thanks to the Fed’s bond-buying programme, which flooded the system with newly created money.
But now banks are preparing for the Fed to become a brake on the rise in deposits. Several chief executives have already told Wall Street analysts they are expecting greater competition for customer funds.
While other more widely discussed effects of quantitative easing include the run-up in asset prices, including stock market and bond valuations, RBC Capital Markets estimates the programme also added between $1.6tn and $2.5tn of deposits to the banking system, which now has total deposits of $11.9tn. The rise in deposits has been especially notable in instant access accounts.
“QE did a gigantic swap of bonds for cash,” said Zoltan Pozsar, director in the global economics and strategy research group at Credit Suisse. “It has since been circling in the system.”
The Fed’s decision to scale back QE could drain $375bn next year and $410bn in 2019, RBC predicts.
William Demchak, chairman and chief executive of PNC Financial Services, the sixth-biggest US bank by assets, told a conference last month that competition for deposits could intensify “partly as a result of the Fed draining cash out of the system by shrinking its balance sheet”.
Presenting quarterly earnings, Terrance Dolan, chief financial officer at US Bancorp, the fifth-largest, said: “As excess liquidity comes out of the market, we would expect there to be more competition for deposits — and that is going to end up impacting pricing.”
He added, though, that the impact would be “very manageable”. Competition for wholesale deposits — those from big companies and institutional investors — would be greater than that for consumer funds, he said.
Executives and economists are divided about the scale of the impact. Some forecasters predict the consequences for deposits will be limited, especially since the Fed is planning to whittle down its balance sheet gradually, initially by $10bn a month. Deposit levels are expected to continue to rise overall as the economy grows, but at a slower rate than in the era of QE.
“This is one of the most challenging intellectual exercises I’m trying to figure out,” said Mr Pozsar. “When people say it’s going to be simple because you just take deposits out, well let’s see.”
Customers have been stuck for years with persistently low interest rates — 0.06 per cent on average — on savings accounts. Banks have been flush with cash and felt little need to woo customers with better deals, even after the Fed has raised base rates.
Competition for deposits is already expected to intensify for other reasons. The rise of online banks has made it easier for consumers to switch banks, and the Fed is considering a further rate rise this year, something that will make it easier for banks to offer higher rates.
Some advisers reckon the post-QE competition for funds will become so great that banks will need to turn to mergers and acquisitions to bulk up their funding base.
“Banks that don’t have alternative sources of financing are going to be hard pressed to easily replace this easy money that they’ve had for the past few years,” said Richard Magrann-Wells, executive vice-president at Willis Towers Watson.
While Fed officials have sought to reassure markets that the unwinding of quantitative easing will be uneventful, top bankers are on guard for potentially far-reaching consequences.
Jamie Dimon, chairman and chief executive of JPMorgan Chase, told the conference: “We’ve never had QE — therefore, we’ve never had the reversal of QE, and it will have some consequences if you reverse it.”
Lululemon athletica: Both near-term catalysts and long-range outlook can support stock upside
Telsey notes amid concerns about the sporting goods industry generally, LULU has demonstrated continued improvement in comp momentum both with its recent results and its outlook, in firm's opinion. They see the strength of the brand, the control of distribution, and the ongoing appeal of its specific category as allowing it to stand somewhat aside from the overall broader channel. Co invented the space in which it operates and continues to enjoy strong brand loyalty and association within the segment, in firm's view. As firm discuss further in their report, they see the potential for investors to benefit both from NT catalysts that can continue to support comp growth in the second half of this year as well as from a strong cash-generating model over the LT; Outperform, $78 tgt
(BN) *QATAR FUND IS SAID TO EXPLORE ASSET SALES AS NEW DEALS ON HOLD
QIA
Early premarket gappers
Gapping up:
- SNCR +22.2%, DVAX +11.4%, ZYNE +5.4%, ALNY +4.5%, SRPT +3.8%,TRUE +2%, CAVM +1.6%, YY +1.4%, NVDA +1.2%, WB +1.1%, JD +1%,MOMO +0.8%, TSLA +0.7%, AMAT +0.7%, MU +0.6%
Gapping down:
- AEMD -35.7%, ROKU -4.6%, CALM -2.7%, WDC -1.9%, WYNN -1.3%, MYL-0.9%, ASML -0.8%, VOD -0.7%
Snap Audience Reach Tracker: September 2017 -- Stifel
In slides accompanying research by Stifel, they note Facebook (FB) and Instagram are ahead of Snapchat in size of total audience, but Snap has leading reach within the 13-24 age demo in many top ad markets and is close to Facebook (46.7 mln vs. 47 mln) in the United States for this demographic. In all demographics in the United States, Facebook, Instagram, Instagram stories, and Snapchat, have total audiences of 225 mln, 107 mln, 70 mln, and 87.2 mln, respectively.
Americans Win Nobel Prize in Physiology or Medicine for Discoveries on Circadian Rhythms
Scientists share $11 million prize for research in the biological clocks of plants, animals and humans
Jeffrey C. Hall, Michael Rosbash and Michael W. Young received the prize for research that led to the understanding of how plants, animals and humans synchronize their biological clocks with the Earth’s revolutions.
The award, announced Monday by the Nobel committee in Stockholm, comes with a check for nine million Swedish kronor ($11.1 million).
Last year, the Medicine Prize was awarded to Japanese biologist Yoshinori Ohsumi for elucidating how the body’s cells deal with and recycle waste.