TheChek News Flow

After Hours Summary: GPS +8% on positive holiday sales, AMGN +4% and SNY -4% following Praluent injunction ruling

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance/SSS: GPS +8.1% (December comps of +3% vs -5% year ago and -1% (BR +5%, ON -2%) last month; now expect full-year EPS to be modestly above high end of previous guidance range), HELE +4.1%, AEHR +3.5%, RNVA +2.6% (discloses an FY17 outlook; expects to begin generating sales from the clinical research organization relationship in the first half of 2017; discloses on Dec 29 co filed a Certificate of Designation with the Secretary of State of Delaware to authorize the issuance of up to 1.75 mln shares of Series F convertible preferred stock), PSMT +0.7%

Companies trading higher in after hours in reaction to news: OGXI +62.1% (will acquire privately held Achieve Life Science in an all-stock transaction; co will be renamed 'Achieve Life Sciences' following completion of merger), STML +32.2% (announces positive FDA meeting and agreement on expedited pathway to full approval of SL-401 in first-line BPDCN), QTNT +18.7% (Quotient Limited reports positive MosaiQ results from performance evaluation study for blood grouping), MDCO +9.8% (attributed to Amgen / Sanofi cholesterol drug injunction decision), NBIX +6.7% (provides update on FDA advisory committee for Ingrezza for the treatment of tardive dyskinesia; FDA decided to cancel the Psychopharmacologic Drugs Advisory Committee meeting which was originally scheduled for Feb 16, 2017), MNTA +6.5% (enters into a research collaboration and worldwide license agreement w/ CSL to develop and commercialize Fc multimer proteins; co to receive $50 million upfront license fee and up to $550 million in potential milestone payments from CSL), URRE +4.7% (light volume; closed the sale of its Churchrock and Crownpoint properties in New Mexico to Laramide Resources for consideration valued at $12.5 mln), AMGN +4.4% (following cholesterol drug Praluent ruling), ANW +3.3% (light volume- launches new service center in Germany that will serve all German Baltic Sea ports and Southern Scandinavian ports; will acquire OBAST's existing share capital), BOX +3% (higher in after hours following CEO appearance on CNBC -- discussed Facebook partnership), ILMN +2.6% (announced that GRAIL has received indications of interest to invest approximately $1B for its Series B financing primarily from undisclosed private and strategic investors; ILMN is invested in GRAIL), EXPE +0.5% (upgraded to Buy at Stifel)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: RT -15.3%, GIII -8.4% (lowers FY17 guidance due to warm weather, persistant lower traffic and challenging retail environment), SHAK -1.7% (appoints Zach Koff as COO and announces CFO Jeff Uttz will retire in 2017; remain confident in the 2016 financial guidance ranges), SUM -1.7% (reports downside Q4 prelim results; launches offering of 10,000,000 shares of its Class A common stock), FC -1.5%, AMRN -1.3% (light volume - sees FY17 revs $155-165 mln vs $171.30 mln Capital IQ Consensus Estimate; sees FY16 rev exceeding prior range)

Companies trading lower in after hours in reaction to news: UEC -10.8% (files for $100 mln mixed securities shelf offering), SNY -4.2% (following cholesterol drug Praluent ruling), GNK -4% (ticking lower; files for 27,061,856 share common stock offering by selling shareholders that were issued upon the conversion of the Series A Preferred Stock), P -2.9% (following Sirius XM Radio CFO conference commentary - ultimately dismissing the possibility of M&A deal), MYOK -2.8% (files for $250 mln mixed securities shelf offering), FRSH -2.2% (CEO resigns; Chair of the Board, Jean Birch, has been appointed interim CEO), MRTX -1.7% (ticking lower - announced data from two ongoing clinical programs including the Phase 1b and Phase 2 trials of glesatinib; announces that co intends to offer and sell shares of its common stock)

Closing Market Summary: Stocks End Little Changed Despite Morning Swoon

The stock market finished Thursday just below its flat line as the S&P 500 shed 0.1%. The Nasdaq outperformed, adding a modest 0.2%.

Stocks were able to overlook the red flags in other markets during the opening hour, but selling interest picked up soon thereafter. The S&P 500 saw a ten-point dip in the late morning amid defensive action in other asset classes. However, the slip, which came ahead of tomorrow's release of the Employment Situation Report for December (consensus 175K), was largely erased by the close.

Cyclical sectors performed slightly worse than their defensive counterparts, as five of the six finished in negative territory. Leading the retreat was the financial sector (-1.0%), which broke its three-session winning streak. Industrials (-0.4%), materials (-0.3%), and energy (-0.3%) also trailed the broader market.

Energy had a poor showing despite crude oil ending the day up 0.9% at $53.87/bbl. The advance occurred as the U.S. dollar retreated for the second consecutive day. The U.S. Dollar Index (101.52, -0.97) finished lower by 1.0%, thanks to strength in the euro (1.0593) and the Japanese yen (115.61). The two currencies increased 1.0% and 1.4% against the dollar, respectively.

The consumer discretionary space (-0.1%) settled in line with the broader market, bouncing back from heavy selling pressure in the morning. The sector started Thursday on the wrong foot after Macy's (M 30.86, -4.98) and Kohl's (KSS 42.01, -9.87) issued disappointing guidance due to weak holiday sales, pushing the SPDR S&P 500 Retail ETF (XRT 44.02, -1.15) lower by 2.6%. However, the sector's top-weighted stock, Amazon (AMZN 780.45, +23.27) had a solid showing, ending the day higher by 3.1%.

The top-weighted technology sector (+0.2%) was the only cyclical group to finish the day in positive territory. However, the win didn't come easy as weakness in chipmakers sent the PHLX Semiconductor Index lower by 0.9%. That soft spot was offset by gains in top components like Apple (AAPL 116.61, +0.59) and Facebook (FB 120.67, +1.98).

On the countercyclical side, health care (+0.5%) finished the day at the top of the leaderboard by capitalizing on biotechnology's positive performance; the iShares Nasdaq Biotechnology ETF (IBB 278.10, +0.87) added 0.3%. Real estate (+0.5%), consumer staples (+0.3%), and utilities (+0.1%) also finished in the green, drawing strength from a decline in yields.

U.S. Treasuries climbed into the late morning and returned to their highs just ahead of the close. The benchmark 10-yr yield fell seven basis points to 2.37%.

Economic data included ADP Employment Change, Initial Claims, and ISM Services:

• The latest weekly initial jobless claims count totaled 235,000 while the Consensus expected a reading of 265,000. Today's tally was below the revised prior week count of 263,000 (from 265,000). As for continuing claims, they rose to 2.112 million from the revised count of 2.096 million (from 2.102 million).
  • The key takeaway from the report is that it points to tight labor market conditions as employers overall appear to be reluctant to cut staff.
• The ADP National Employment Report showed an increase of 153,000 in December (consensus 170,000) while the November reading was revised lower to 215,000 from 216,000. The ADP reading precedes Friday's more influential Employment Situation Report for December, which the consensus expects will show the addition of 175,000 nonfarm payrolls. The Employment Situation Report for November indicated that nonfarm payrolls increased by 178,000.
• The ISM Services Index for December held at 57.2 while the consensus expected a downtick to 56.6.
  • The key takeaway from the report is that respondents' comments were mostly positive about business conditions and the overall economy, reinforcing the market's belief that the U.S. economy, which is driven predominately by the non-manufacturing sector, was exhibiting some encouraging growth characteristics as 2016 came to an end.

Tomorrow, the Employment Situation report for December ( consensus 175K) and November Trade Balance (consensus -$42.20 billion) will be reported at 8:30 ET while November Factory Orders (consensus -2.1%) will cross the wires at 10:00 ET.

• Nasdaq Composite +2.0% YTD
• S&P 500 +1.4% YTD
• Russell 2000 +1.1% YTD
• Dow Jones Industrial Average +0.7% YTD