>>> US After Hours Summary: WWD / RMBS +2%, SWFT +1%, CLB -7%, GOOG /


After Hours Summary: WWD / RMBS +2%, SWFT +1%, CLB -7%, GOOG / APC -3% following earnings/guidance, CLLS +6% on patent news

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: WWD +2%, MC +1.8% (ticking higher), RMBS +1.7%, CDNS +1.5%, SWFT +1.3%

Companies trading higher in after hours in reaction to news: CLLS +5.6% (granted patent for CRISPR use in CAR T-cells), ATW +4.4% (ticking higher; provides fleet status report as of July 24, 2017), GNCA +2.9% (continued strength), SRCI +1.8% (reports operational update; reaffirms 2017 operated D&C capex of $320-340 mln), JCP +1.2% (light volume; announced that Jeffrey Davis is joining as EVP/CFO effective today)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: TISI -21.2% (reports prelim Q2 results, finalizes negotiations of credit facility amendment and terminates At-the-Market equity offering program), SANM -9.2%, CLB -6.9%, GOOG -3.1%, APC -3.1%, HSII -2.9% (light volume), HXL -1.4%

Companies trading lower in after hours in reaction to news: NVAX -17.9% (announces topline data from its Phase 2 safety and immunogenicity trial of the RSV F Vaccine in older adults, new data on RSV F vaccine, and additional findings from prior phase 2 and 3 studies of E201 and E301), MBRX -3.7% (files for $75 mln mixed securities shelf offering), FTI -1.6% (light volume; will restate select financial statements; determined material weakness existed relating to the rates used in calculations of foreign currency effects), MRK -0.9% (Phase 3 Study of KEYTRUDA pembrolizumab monotherapy in patients with previously treated recurrent or metastatic head and neck squamous cell carcinoma did not meet its pre-specified primary endpoint of overall survival)

>>> Asian Update

Asia Mid-Session Market Update: Markets lack direction ahead of FOMC; China affirms stability in H2

***Asia Summary***
- Markets lacked direction, opening mixed and spending the session little changed. Data in the session was light and Bank of Japan (BOJ) minutes from June failed to inspire. Japan earnings start to pick up this week and will start with Mitsubishi Motors today. NZD/USD fell to a fresh session low of 0.7401 after New Zealand press reported that contagious disease was found in 14 cows, not long after returned to unchanged levels at 0.7434.

- China Central Committee Political Bureau (politburo) indicated that China will continue seeking progress while maintaining stability for its economic work in H2 2017. They will also focus on stabilizing the real estate market, curbing local government debt growth and implementing supply side reform.

***Key economic data***
- (KR) South Korea July Consumer Confidence: 111.2 v 111.1 prior (6th consecutive rise, 6.5-yr high)
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 115.1 v 112.5 prior

***Speakers and Press***
China
- (CN) Liquidity condition in the money market has passed tightest period and may ease further in early August - China Securities Journal Op Ed
- (CN) China President Xi: Economy in H1 maintained steady growth with a positive outlook, deepened structural adjustment, and better than expected performance in major indicators
- (CN) China Think Tank sees H2 exports +6.6% in USD terms - Chinese Press

Korea
- (KR) South Korea President Moon: Said to have discussed increasing the weight of South Korean ballistic missile’s warhead to 1 ton from 500kg when he met with US President Trump last month - Korean press
- (KR) South Korea Finance Ministry raises GDP outlook: 2017 and 2018 GDP to 3% (prior 2.6%) on exports and extra budget; Sees 2017 exports +10.2% y/y
- (KR) South Korea Fin Min Kim: Facing structural crisis of inequality and low growth; will spend 70% of extra budget in Q3

Japan
- (JP) Bank of Japan (BOJ) June 15th and 16th Monetary Policy Meeting Minutes: Japan's economy had been turning toward a moderate expansion; Financial conditions were highly accommodative

Other
- Macronix, 2337.TW Reports Q2 (NT$) Net 622M v loss 835M y/y; Op 585M v loss 846M y/y; Rev 6.56B, +27% y/y

***Asian Equity Indices/Futures (00:00ET)***
- Nikkei -0.0%, Hang Seng -0.00%, Shanghai Composite -0.1%, ASX200 +0.91%, Kospi -0.08%
- Equity Futures: S&P500 -0.02%; Nasdaq -0.07%, Dax +0.02%, FTSE100 +0.02%

***FX ranges/Commodities/Fixed Income (00:00ET)***
- EUR 1.1664-1.1631; JPY 111.34-110.99; AUD 0.7944-0.7903; NZD 0.7445-0.7401
- Aug Gold +0.15% at 1,256/oz; Aug Crude Oil +0.58% at $46.61/brl; Sept Copper +0.87% at $2.77/lb
- GLD SPDR Gold Trust ETF daily holdings fall 4.14 tonnes to 809.6 tonnes
- USD/CNY *(CN) PBOC SETS YUAN REFERENCE RATE AT V 6.7485 V 6.7410 PRIOR
- (CN) China PBOC OMO injects CNY140B in 7 and 14 day reverse repos v CNY350B prior
- (JP) Japan MoF sells ¥500B in 0.9% 40-year JGB bonds, bid to cover: 3.20x v 2.87x prior (highest bid-to-cover since Jan 2015)

***Equities notable movers***
Australia
- Grange Resources, GRR.AU Reports Q4 pellet production 184Kt v 486Kt q/q; Pellets sold 318kt v 473Kt q/q; +5.8%
- Yowie, YOW.AU Reports Q4 Rev +23% y/y; YNA Net Sales $3.48M, flat y/y; -13.3%

Hong Kong/China
- Sunac China, 1918.HK To place 220M shares at HK$18.33/shr for HK$4.03B (~5.6% of shares outstanding and at an 8.8% discount to Monday close); -8.4%
- China Merchants Bank, 3968.HK Reports H1 prelim (CNY) Net 39.3B v 35.2B y/y, Op 49.6B v 45.0B y/y, Rev 112.7B v 112.9B y/y; +11.4%
Japan
- Show Denko, 4004.JP Revises FY17/18 guidance: cuts Net ¥21B from ¥25B; Op ¥60B from ¥54.5B; Rev to ¥762B from ¥745B; -5.4%

South Korea
- Hynix,000660.KR Reports Q2 (KRW) Net 2.47T v 2.32Te; Op 3.05T v 2.93Te; Rev 6.69T v 6.82Te; -1.8%

Other
-Logitech, LOGI Reports Q1 $0.24 v $0.22e, Rev $529.9M v $521Me; -0.2% afterhours

***US markets on close: Dow -0.3%, S&P500 -0.1%, Nasdaq +0.4%, Russell +0.2% ***
- Best Sector in S&P500: Financials
- Worst Sector in S&P500: Telecom
- Biggest gainers: WYNN 3.3%; NRG 3.2%; INCY +3.0%
- Biggest losers: HAS -9.4%; FL -4.6%; HAL -4.2%
- At 17:00ET/21:00GMT: VIX 9.43 (+0.07pts); Treasuries: 2-yr 1.37% +1.6%), 10-yr 2.26% (+1.1%), 30-yr 2.84% (+1.2%)

>>> US Close Dow -0.31% S&P -0.11% Nasdaq +0.36% Russell +0.15%

Closing Market Summary: Equities Finish Monday Mixed

Equities opened the week with a mixed performance; the Nasdaq (+0.4%) finished at another record close, its fourth in the last five sessions, while the S&P 500 (-0.1%) and the Dow (-0.3%) settled with modest losses. Monday's action was fairly range-bound with the benchmark index staying true to a seven-point range from start to finish.

Investors understandably lacked conviction on Monday ahead of several notable events on this week's calendar, including:

  • a Senate vote on health-care reform, which could take place as early as Tuesday
  • the Fed's latest policy directive, which will cross the wires at 14:00 ET on Wednesday
  • the advance estimate for second-quarter GDP, which will be released at 8:30 ET on Friday
  • and a slew of influential earnings reports that will be delivered throughout the week 

The cautious sentiment was present in pre-market action on Monday morning, leaving the major averages modestly lower at the opening bell. Nine of eleven sectors finished in negative territory with the two advancers being the top-weighted technology (+0.3%) and financials (+0.3%) groups.

Financials exhibited relative strength throughout the session while tech stocks took awhile to come around. In the end, the positive performances of mega-cap tech names like Apple (AAPL 152.09, +1.82), Facebook (FB 166.00, +1.57), and Alphabet (GOOGL 998.31, +4.47) were enough to push the tech sector to victory. Chipmakers underperformed, leaving the PHLX Semiconductor Index lower by 0.4%. 

As for the declining sectors, they finished with losses ranging between 0.1% and 1.0%. The telecom services (-1.0%) and utilities (-0.9%) groups were the weakest performers while the remaining laggards finished with losses of no more than 0.4%.

The consumer discretionary sector (-0.4%) underperformed following a negative reaction on the earnings front. Hasbro (HAS 105.00, -10.95) dropped 9.4% after concerns surrounding economic conditions overseas overshadowed the company's better than expected earnings. Similarly, Stanley Black & Decker (SWK 143.70, -3.09) slipped 2.1% despite beating top and bottom line estimates.

In addition, Hibbett Sports (HIBB 13.10, -6.60) plunged 33.5% after the company issued a profit warning, saying that it expects comparable-store sales to drop around 10.0% in the second quarter. Peer Dick's Sporting Goods (DKS 35.12, -2.04) also sold off following the announcement, dropping 5.5%.

Crude oil jumped 1.3% to $46.36/bbl on Monday following news that Saudi Arabia will limit its oil exports to 6.6 million barrels per day (bpd) in August, nearly one million bpd below the level it produced a year ago. In addition, Nigeria, which was originally exempt from the OPEC-led production cut agreement, has pledged to limit its exports to 1.8 million barrels per day.

However, the energy sector, which typically moves in tandem with crude oil, lost 0.3%. Halliburton (HAL 42.51, -1.87) weighed on the sector, dropping 4.2%, after saying that North American customers are 'tapping the brakes'. However, the company did beat top and bottom line estimates.

In the bond market, U.S. Treasuries settled the day with modest losses. The benchmark 10-yr yield, which moves inversely to the price of the 10-yr Treasury note, climbed one basis point to 2.25%.

Reviewing Monday's economic data, which was limited to June Existing Home Sales:

  • Existing home sales for June decreased 1.8% from May to an annualized rate of 5.52 million units while the consensus expected a reading of 5.58 million. The prior month's reading was left unrevised at 5.62 million.
    • The key takeaway from the report is that neither the availability nor the affordability of homes is high, which is keeping sales activity from being all that it could be otherwise.

On Tuesday, investors will receive the May FHFA Housing Price Index (consensus 0.7%) at 9:00 ET, the May S&P 500 Case-Shiller Home Price Index (Briefing.com consensus 5.7%) at 9:00 ET, and the Conference Board's Consumer Confidence Index for July at 10:00 ET.

In addition, several notable companies will report earnings on Tuesday morning, including 3M (MMM 210.00, -1.16), McDonald's (MCD 151.85, -2.07), United Technologies (UTX 123.13, -0.36), DuPont (DD 84.35, -0.19), and Caterpillar (CAT 108.18, +1.59), among many others.

  • Nasdaq Composite +19.1% YTD
  • S&P 500 +10.3% YTD
  • Dow Jones Industrial Average +8.9% YTD
  • Russell 2000 +6.0% YTD

>>> Werner Enterprises beats by $0.05, reports revs in-line

Werner Enterprises beats by $0.05, reports revs in-line
  • Reports Q2 (Jun) earnings of $0.32 per share, $0.05 better than the Capital IQ Consensus of $0.27; revenues rose 4.2% year/year to $519.5 mln vs the $521.63 mln Capital IQ Consensus.
  • Average revenues per tractor per week increased 4.1% in 2Q17 compared to 2Q16 due to a 2.4% increase in average revenues per total mile and a 1.7% increase in average miles per truck.
  • In 2Q17, it averaged 7,270 trucks in service in the Truckload Transportation Services segment and 48 intermodal drayage trucks in the Werner Logistics segment.
  • Co states: "The driver recruiting market remains challenging. Several ongoing market factors persist including a declining number of, and increased competition for, driver training school graduates, a low and declining national unemployment rate, aging truck driver demographics and increased truck safety regulations. We proactively took many significant actions in the last two years to strengthen our driver recruiting and retention to make Werner the preferred choice for the best drivers, including raising driver pay, lowering the age of our truck fleet, installing safety and training features on all new trucks and investing in our driver training schools. Our driver turnover rate once again improved, achieving the lowest second quarter rate in 19 year

>>> Celanese beats by $0.03, beats on revs; increases FY17 EPS growth estimate i

Celanese beats by $0.03, beats on revs; increases FY17 EPS growth estimate in-line with expectations (97.61 -0.05)
  • Reports Q2 (Jun) earnings of $1.79 per share, excluding non-recurring items, $0.03 better than the Capital IQ Consensus of $1.76; revenues rose 11.8% year/year to $1.51 bln vs the $1.44 bln Capital IQ Consensus.
  • Co is increasing its expectations for growth in FY 2017 adjusted earnings per share to 9-11% (prior was +8-11%), which translates to EPS of $7.20-7.34, excluding non-recurring items, vs. $7.30 Capital IQ Consensus Estimate.
    • Productivity savings of approximately $100 million are on target for the year, supported by initiatives across the company.
  • Briefing.com note: Celanese (CE) and funds managed by Blackstone (BX) announced a definitive agreement on June 19to form a JV that will create a global acetate tow supplier. Celanese and Blackstone will own 70% and 30% of the JV, respectively.

>>> Everest Re beats by $0.27

Everest Re beats by $0.27 (271.12 +1.00)
  • Reports Q2 (Jun) earnings of $5.51 per share, excluding non-recurring items, $0.27 better than the Capital IQ Consensus of $5.24.
  • Gross written premiums for the quarter were $1.6 billion, an increase of 17% compared to the second quarter of 2016. Worldwide, reinsurance premiums were up 14%, with growth coming from the new crop reinsurance program, increased shares on property pro-rata treaties, and growth in financial lines business. Insurance premiums were up 25%, quarter over quarter, with continued growth on new initiatives. Excluding the HCI crop business that was sold in 2016, the insurance segment premium was up 41%, quarter over quarter.
  • The combined ratio for the quarter was 90.5% compared to 95.1% in the second quarter of 2016. Excluding catastrophe losses, reinstatement premiums, and nominal prior period loss development, the current quarter attritional combined ratio was 86.7% compared to 86.1% in the same period last year.
  • Shareholders' equity ended the quarter at $8.6 billion, up 6% compared to year end 2016. Book value per share increased 6% from $197.45 at December 31, 2016 to $209.05 at June 30, 2017

>>> Moelis beats by $0.18, beats on revs

>>> Moelis beats by $0.18, beats on revs (40.65 +0.35)
  • Reports Q2 (Jun) earnings of $0.66 per share, excluding non-recurring items, $0.18 better than the Capital IQ Consensus of $0.48; revenues rose 30.7% year/year to $172.1 mln vs the $156.85 mln Capital IQ Consensus
  • This compares favorably with a 3% decrease in the number of global completed M&A transactions in the same period
  • The increase in revenues was driven by significant growth in its M&A activity and an increase in its restructuring activity over the prior year period, including higher average fees earned per completed transactio

>>> Heidrick & Struggles misses by $0.01, misses on revs; guides SepQ revs in-l

Heidrick & Struggles misses by $0.01, misses on revs; guides SepQ revs in-line
  • Reports Q2 (Jun) earnings of $0.33 per share, excluding non-recurring items, $0.01 worse than the two analyst estimate of $0.34; revenues before reimbursements rose 2.3% year/year to $152.21 mln vs the $157.0 mln Capital IQ Consensus and vs prior guidance of $153-163 mln.
  • Co issues in-line guidance for Q3 (Sep), sees Q3 revs before reimbursements of $148-158 mln vs. $155.1 mln Capital IQ Consensus Estimate.
  • Co says its Q2 (Jun) results reflect solid performance in its core business, Executive Search, and strong growth in Leadership Consulting.
  • Going forward, co will integrate its Leadership Consulting and Culture Shaping operations into a single business, Heidrick Consulting, which will provide a comprehensive service offering that will help clients accelerate their performance