Monday, November 1, 2021
Futures Up/Down % Last
Dow 159.00 0.45% 35,863
S&P 500 20.25 0.44% 4,617
Nasdaq 65.50 0.41% 15,904
Another day, another record for U.S. averages with the S&P, Dow and Nasdaq looking to add to October gains and kick off the new trading month off strong. Materials and some consumer products are getting a boost after the U.S. and European Union reached a trade truce on steel and aluminum tariffs over the weekend. The two sides were working hard to reach a deal before Dec. 1, when the European retaliatory tariffs were set to double; the 25% tariffs will apply to EU exports beyond 3.3 million tons, Bloomberg reported. The EU agreed to drop retaliatory tariffs on U.S. motorcycles, jeans and bourbon whiskey per Bloomberg (shares of names like HOG looking higher). Earnings optimism also continues to offset concern over a near-term move on tapering from the Federal Reserve that could add to signals of slowing growth in the supply chain-snarled economy, ahead of the FOMC meeting later this week. In Asian markets, The Nikkei Index rose 2.6% or over 750 points to 29,647, the Shanghai Index slipped a few points to 3,544 and the Hang Seng Index dropped -0.88% or over 200 points to 25,154. In Europe, the German DAX is up about 135 points to 15,825, while the FTSE 100 gains +0.5% to 7,275. After posting the worst monthly returns since March 2020 in September, it was a rip fest in October as the S&P 500 500 gains 6.9%, the Dow Jones Industrial Average climbs 5.8%, the Nasdaq Composite adds 7.3% and the Russell 2000 jumps 4.2%. The S&P 500, Dow register 4-straight weeks of gains for the first time since mid-April, Nasdaq notches first 4-week advance since June. As for last week, the S&P 500 gains 1.33%, the Dow rose 0.4% and Nasdaq added 2.71%. overall Friday, the U.S. stock market set another round of record highs as Wall Street looked past disappointing results from major companies Apple and Amazon to wrap up its best month of the year.
Market Closing Prices Yesterday
The S&P 500 Index gained 8.96 points, or 0.19%, to 4,605.38
The Dow Jones Industrial Average rose 89.06 points, or 0.25%, to 35,819.56
The Nasdaq Composite climbed 50.29 points, or 0.33%, to 15,498.39
The Russell 2000 Index slipped -0.79 points, or 0.03% to 2,297.19
Events Calendar for Today
10:00 AM ET Construction Spending for September
10:00 AM ET ISM Manufacturing PMI for October
Earnings Calendar:
Earnings Before the Open: AMG, BEN, CNA, ENBL, IVAC, JELD, L, OIS, ON, PCG, SXC, TKR
Earnings After the Close: ADC, ADTN, ADUS, ANET, APEN, BNL, BRKR, BRX, BWXT, CACC, CAR, CHGG, CLX, CRUS, CSWC, CURO, EPRT, EVER, FANG, GXO, HLIT, HOLX, IPI, KFRC, KMT, LEG, LXU, MCK, MOS, NBIX, NSP, O, OTTR, PLOW, PSA, RHP, RIG, RMBS, SBAC, SKT, SOI, SPG, TA, TTI, UAN, UNVR, VNO, VNOM, VRNS, WMB, ZI
Macro Up/Down Last
Nymex 0.50 84.07
Brent 0.83 84.55
Gold 4.40 1,790.30
EUR/USD -0.0009 1.1570
JPY/USD 0.18 114.17
10-Year Note +0.023 1.579%
World News
China’s official manufacturing purchasing managers’ index fell to 49.2, the National Bureau of Statistics said Sunday, the second month it was below the key 50-mark that is between expansion and contraction
The U.K. and France have agreed to de-escalate their spat over Brexit and fishing rights following a meeting between French President Emmanuel Macron and British Prime Minister Boris Johnson on the sidelines of the Group of 20 summit of leaders in Rome
Sector News Breakdown
Consumer
Barron’s took a deep dive into the roads automakers and their suppliers are taking to build a better battery. Raw materials have gotten an upgrade to shorten the supply chain and boost performance. Tesla ($TSLA) has switched to nickel as a substitute for scarcer cobalt, while General Motors ($GM) has sought out alternatives to graphite since its mostly mined in China, Barron’s said. Companies that benefit from revamped supply chains will be the best investment, Albemarle ($ALB), for instance, supplies about one-third of the world’s lithium. Battery capacity will need to jump fourfold by the next few years, according to Barron’s
NVR Corp. ($NVR) mentioned positively in Barron’s noting the stock has been flat in recent months and KeyBanc’s analyst said he saw diminished earnings momentum but still kept a $5,450 price target on the stock, an 11% premium over Friday’s close, and for the first time this year, a company insider recently made an open-market buy
Bally’s Corporation ($BALY) submitted a proposal to Chicago to develop and operate the $1.6 billion Bally’s Chicago, an entertainment destination resort.
Li Auto ($LI) has delivered 7,649 Li ONEs, up 107.2% year over year; as of October 31, 2021, the year-to-date and cumulative deliveries of Li ONEs reached 62,919 and 96,516 respectively.
Nio ($NIO) said it delivered 3,667 vehicles in October 2021, representing a decrease of 27.5% year-over-year.
XPeng ($XPEV) said monthly deliveries in October 2021 of 10,138 Smart EVs, representing an increase of 233% Y/Y and a 2.6% decline over last month
Wynn Resorts ($WYNN), Melco Gaming (MLCO): Macau’s gaming bureau reported October gross revenue from games of fortune in the region decreased 40% year-over-year to 4.365B patacas.
Stanley Black & Decker ($SWK) downgraded to Underperform from Neutral at Bank America
Energy, Industrials and Materials
The U.S. and the European Union have announced a deal at the G20 summit in Rome to ease U.S. tariffs on steel and aluminum totaling more than $10B of E.U. exports each year, removing one of the most significant trade disputes from the Trump administration’s levies imposed in 2018
Deere ($DE) said it reached a tentative agreement with the United Auto Workers (UAW) two weeks after more than 10K workers at 14 plants went on strike. The deal, reached after 90% of union members rejected the first tentative agreement, “contains enhanced economic gains and continues to provide the highest quality healthcare benefits in the industry,” the UAW said.
China’s Ganfeng Lithium Co Ltd and its unit GFL International Co Ltd have signed a contract to supply battery-grade lithium products to U.S. electric vehicle (EV) maker Tesla Inc ($TSLA)
Financials
Barclays PLC ($BCS) CEO Jess Staley was asked to step down Monday following an investigation by U.K. regulators into his relationship with convicted sex offender and financier Jeffrey Epstein. Britain’s Financial Conduct Authority said Staley, 64, told regulators and the bank that his relationship with Epstein ended in 2015.
CNA Financial ($CNA) Q3 core EPS 87c vs. est. 60c; posted record underlying combined ratio of 91.1%, double-digit gross written premium growth across all of our P&C business segments and excellent new business growth of 24%
Healthcare
Moderna ($MRNA) announced that the FDA informed it on Friday that the agency required additional time to review the company’s Emergency Use Authorization (EUA) request for COVID-19 vaccine for use in those aged 12 – 17 years. Regulators told Moderna that the analysis may not be completed until January
Novavax ($NVAX) files for covid-19 vaccine authorization with health Canada and completes submission for rolling review to European medicines agency
Tilray ($TLRY) downgraded to Neutral from Overweight at Cantor Fitzgerald and cut tgt to $11.80 from $18.00
LianBio ($LIAN)3M share IPO priced at $16.00
Technology, Media & Telecom
Madison Square Garden Sports ($MSGS) MSG Entertainment $(MSGE) and AMC Networks ($AMCX) are at inexpensive prices according to Barron’s. Online sports gambling, due to start in New York in the next few months, looks like a big plus for both MSG Sports and MSG Entertainment because of advertising, fan engagement, and a potential sports book in Madison Square Garden
Pearson Plc ($PSO) may see increased pressure from Europe’s largest activist pressure as the company works to convince holders about a turnaround under CEO Andy Bird, according to a Telegraph report. Activist Cevian Capital now owns 8.5% of Pearson and is the company’s second largest investor, the Telegraph reported. https://bit.ly/3muoDGw
Cinemark Holdings Inc. ($CNK) and IMAX Corp. (IMAX) time to shine said Barron’s noting IMAX had its best October on record thanks to “Dune” and other films. Meanwhile, “Cinemark’s 3Q results should show further signs of improvement as the business steadily builds momentum,” writes MKM analyst Eric Handler.
AMC Entertainment ($AMC) claimed that the domestic industry box office for October 2021 is estimated to come in considerably higher than that of any previous month since February of 2020.
TripAdvisor ($TRIP) downgraded to Underweight from Overweight at Barclays and cut tgt to $30 from $49
