Indicators
Wake Up Call
- Hello ! US equity futures were little changed Monday as traders searched for fresh cues at the start of a holiday-shortened week. Out now : June New York Fed Empire Index at -6.0, Above Est -9.0
- FED - FOMC Vice-Chair Williams leads the line on Monday amid a plethora of appearances. The Fed left rates on hold, as was widely expected, but the updated dot plots to now signal only one rate cut in 2024 vs. three in the March projections, while money markets and analysts were looking for two rate cuts in 2024. Four policymakers even see no rate cuts this year, seven pencil in just one reduction, while eight expect there to be two rate cuts this year. Find below the Calendar of the week (UK Time)
MONDAY
5pm : Fed Vice Chair Williams to speak at Economic Club of New York Event.
6pm : Fed’s Harker (2026 voter) to speak on the economic outlook
TUESDAY
2am : Fed Governor Cook to speak at the 2024 Marshall Forum : A US-UK Strategic & Economic Dialogue, Chicago, Ill
3pm : Fed’s Barkin (2024 voter) discusses economic outlook
4.40pm : Fed’s Collins (2025 voter) delivers keynote address
6pm : Fed’s Logan (2026 voter) to speaks at Headliners Club in Austin
6pm : Fed Governor Kugler speaking on the economic outlook and monetary policy
6.20pm : Fed’s Musalem (2025 voter) speaking on the economy and monetary policy
7pm : Fed’s Goolsbee (2025 voter) speaking on the economy and monetary policy
WEDNESDAY >> Juneteenth - US markets will be closed.
THURSDAY
1.45pm : Fed’s Kashkari (2026 voter) speaking at a banking conference
9pm : Fed’s Barkin (2024 voter) to speak on the economic outlook
FRIDAY
3.15am : Fed’s Daly (2024 voter) discusses AI
8.30pm : Fed’s Barkin (2024 voter) to speak on the economic outlook - S&P 500 - Goldman Sachs lifted its S&P 500 year-end target to 5,600 (prev. 5,200). The bank said its upgraded forecast was based on strong EPS growth and an increased fair value P/E (from 19.5x to 20.4x). Its 2024 and 2025 earnings estimates remain unchanged, but stellar earnings growth by five mega cap tech stocks have offset the typical pattern of negative revisions to consensus EPS estimates. It said that in a “catch-up” scenario, the index could be boosted to 5,900 (further mega-cap exceptionalism could even take it to 6,300), while in a “catch-down” scenario, there are risks the index could fall to 4,700), while a recession risk scenario could see the index slump to 4,800.
Wall Street Movers
- ALLEGO +128% !! Allego and majority holder Meridiam agree that Meridiam will launch tender offer for all shares of Allego it doesn’t own and that Allego will then voluntarily delist from NYSE, according to statement. Tender offer price of $1.70 per ordinary share in cash, without interest (131% premium vs last close)
- AMAZON / NETFLIX (both flat) Amazon's Prime Video has disrupted the streaming ad market, prompting Netflix to lower ad rates and adopt product placement to sustain its ad business amid rising competition, WSJ reports.
- APPLE / META The EU is poised to charge Apple under new EU digital rules for allegedly restricting competition on its App Store, FT reports. The European Commission found Apple violated obligations by limiting developers from steering users to external payment options without fees. If found to be in breach of the DMA, Apple faces daily penalties for non-compliance of up to 5% of its average daily worldwide turnover, which is currently just over $1b. Recent reports also suggest that Meta will also likely face charges for failing to comply with the DMA.
- AUTODESK +4% Starboard Value says it’s filing lawsuit against Autodesk in Delaware Court of Chancery, seeking to delay 2024 annual meeting and reopen nomination window. Believes Autodesk failed to disclose material accounting and disclosure issues before deadline for nominating directors. Starboard says it holds ownership stake valued at over $500m
- STEEL DYNAMICS -2% sees 2Q EPS between $2.64-2.68 (exp. 2.98). 2Q earnings from metals recycling operations are expected to be higher than sequential Q1 results.
- TESLA flat has been granted approval to test its advanced driver-assistance system on some Shanghai streets. Elsewhere, Cybertruck deliveries have been halted over a windshield wiper issue btu no recall notice has been issued, according to Electrek.
- US STEEL -1.20% Sees adj 2Q EPS 76c-80c, consensus 83c ; adj Ebitda $425m, saw $425m to $475m, estimate $443.6m.
- WALT DISNEY +1.20% Pixar's 'Inside Out 2' generated around $155m in US sales on its opening weekend, the strongest debut for a film this year, WSJ reports. Separately, Deadpool & Wolverinewill hit Chinese theaters next month, a win for the studio after Beijing barred previous blockbuster releases at a time of frosty relations with the US.
At A Glance
- ADVANCE AUTO PARTS identified unauthorized activity within a third-party cloud database environment containing its data on May 23, and a criminal threat actor offered what it alleged to be company data for sale on June 4.
- AMERICAN AIRLINES and its flight attendants will meet for contract talks on Tuesday after making some progress toward an agreement that would avert a walkout in the summer travel season.
- AMGEN said it got FDA approval for Blincyto for CD19-positive Philadelphia chromosome-negative B-ALL in the consolidation phase regardless of measurable residual disease status.
- BIONTECH says US FDA placed partial clinical hold on multicenter and first-in-human phase 1 clinical trial sponsored by Medilink
- BOEING FAA received more than 11 times as many Boeing whistleblower reports in the first five months of this year compared with all of 2023.
- BROADCOM is on pace to rise for a seventh session. Last week, Broadcom said it planned to execute a 10-for-1 stock split.
- CAPITAL ONE FINANCIAL May Domestic Credit Card Net Charge Offs 6.13% (prev. 6.07% M/M); delinquencies 4.13% (prev. 4.23% M/M)
- CARLYLE is exploring a sale of Cogentrix Energy, FT reported. Carlyle has hired advisers on the sale that could value the targeted Co. at as much as $3b to $4b.
- COPPER NAMES FREEPORT CEO said consolidation of the copper mining industry into a handful of big groups has the potential to lift output of the supply-constrained metal vital for the clean energy transition, via the FT.
- HARTFORD FINANCIAL SERVICES An insurance unit of Co. is seeking to avoid paying for legal bills in a suit against a DNA analysis company alleging it violated Illinois’ Genetic Information Privacy Act.
- JPM Credit Card charge-off rate 1.53% in May (1.48% in April), Delinquency Rate 0.82% (0.81% in April)
- OPENAI is working with startup Color Health to expand the use of AI in healthcare by applying its AI models to cancer screening and treatment.
- SONOCO will raise the price for all converted paperboard products by a minimum of 6 percent, effective with shipments in the US and Canada, on or after July 10th, 2024.
- STARBUCKS Positive mention in Barron's - Said SBUX stock was a buy, and will get a 'jolt', noting that the business is growing at a rapid pace, and continues to adapt with greater efficiency and diverse products.
- VISTA OUTDOOR reaffirmed its recommendation that stockholders vote in favor of the Czechoslovak Group deal to buy Kinetic for $1.96b in cash and said it remains confident it will get clearance from the CFIUS.
- ZILLOW reached an antitrust settlement with a set of multiple listing services that it accused of conspiring to block Zillow’s tour booking software platform.
Broker Moves
UPGRADES
- US EQUITIES upgraded to Overweight vs Neutral at Citi
- BEST BUY raised to Buy from neutral at UBS
- FATE THERAPEUTICS raised to overweight at Piper Sandler
- OLLIE’S BARGAIN upgraded to overweight at JPMorgan; PT $10
- TOLL BROTHERS raised to neutral at Goldman; PT $124
DOWNGRADES
- MSC INDUSTRIAL downgraded to sector weight at KeyBanc
Today's Key Events (UK Time)
17:00 Fed's Williams Moderates Discussion at Economic Club of NY
18:00 Fed's Harker Speaks on Economic Outlook
Game Of Corporate Actions
DIV EX DATE
- Today : DTE Energy ($1.02); Eastman Chemical ($0.81); Garmin ($0.75); Huntington Bancshares ($0.155); Iron Mountain ($0.65); Merck ($0.77); Paramount Global ($0.05); Prologis ($0.96); UnitedHealth ($2.1)
- Tomorrow : Amphenol ($0.11); Cinnati Financial ($0.81); Ecolab ($0.57); Hewlett Packard Enterprise ($0.13); Lam Research ($2); Pulte($0.2); Southwest Airlines ($0.18); VICI Properties ($0.415); Vistra ($0.2175)
EARNINGS
- Today aft mkt : Lennar