After Hours Report

The S&P 500, which closed above 4,500, and the Nasdaq Composite eked out slim gains thanks to support from mega cap stocks. The broader market, meanwhile, experienced some normal consolidation, but losses were modest compared to the size of recent gains. 

The Vanguard Mega Cap Growth ETF (MGK) rose 0.5% while the market-cap weighted S&P 500 logged a 0.1% gain. The equal weighted S&P 500 declined only 0.3%. Declining issues led advancing issues by a 5-to-3 margin at the NYSE and a 2-to-1 margin at the Nasdaq.

Big negative reactions to disappointing earnings and/or guidance from Walmart (WMT 156.04, -13.74, -8.1%), Cisco (CSCO 48.04, -5.24, -9.8%), and Palo Alto Networks (PANW 242.30, -13.88, -5.4%) helped create an excuse for market participants to take profits.

Small and mid cap stocks lagged their larger peers after outperforming all week. The Russell 2000 fell 1.6% today, weighed down by its energy components, but is still up 4.0% this week. The S&P Mid Cap 400 declined 1.1%, but is still up 3.1% this week. 

Only four of the 11 S&P 500 sectors logged a decline. The energy sector (-2.1%) saw the largest loss, falling as oil prices slid ($72.92/bbl, -3.64, -4.8%) in response to slowdown worries and technical selling after closing yesterday below their 200-day moving average. The consumer staples sector (-1.2%) was the next worst performer due in part to the loss in Walmart.

Meanwhile, the heavily-weighted communication services (+0.9%) and information technology (+0.7%) sectors registered the biggest gains.

The 10-yr note yield fell nine basis points to 4.45% and the 2-yr note yield declined six basis points to 4.85% after this morning's economic releases fit with the soft landing scenario for the economy. The data included initial jobless claims, the October Export-Import Price Index, the November Philadelphia Fed Index, October Industrial Production, and the November NAHB Housing Market Index.

In other news, the Senate passed the continuing resolution and President Biden and President Xi agreed to resume high-level, direct military talks, and bilateral cooperation in combating global illicit drug manufacturing and trafficking.

• Nasdaq Composite: +34.9% YTD
• S&P 500: +17.4% YTD
• Dow Jones Industrial Average: +5.4% YTD
• S&P Midcap 400: +3.5% YTD
• Russell 2000: +0.7% YTD

Reviewing today's economic data:

• Weekly Initial Claims 231K (Briefing.com consensus 220K); Prior was revised to 218K from 217K; Weekly Continuing Claims 1.865 mln; Prior was revised to 1.833 mln from 1.834 mln
  • The key takeaway from the report is that it fits the Fed's preferred script of seeing some softening in the labor market. Initial claims are at their highest level since August and continuing jobless claims are their highest level since November 2021.
• October Export Price Index -1.1%; Prior was revised to 0.5% from 0.7%
• October Export Prices ex-ag. -1.0%; Prior was revised to 0.7% from 1.0%
• October Import Price Index -0.8%; Prior was revised to 0.4% from 0.1%
• October Import Prices ex-oil -0.2%; Prior -0.2%
• November Philadelphia Fed Index -5.9 (Briefing.com consensus -7.5); Prior -9.0
• October Industrial Production -0.6% (Briefing.com consensus -0.4%); Prior was revised to 0.1% from 0.3%; October Capacity Utilization 78.9% (Briefing.com consensus 79.4%); Prior was revised to 79.5% from 79.7%
  • The key takeaway from the report is that it was adversely affected by the UAW strike, which has since ended. Motor vehicle and parts production, therefore, should turn into a tailwind for November industrial production, which is a thought that takes some of the sting out of the disappointing headline number for October.
• November NAHB Housing Market Index 34 (Briefing.com consensus 40); Prior 40

Friday's economic calendar is limited to October Housing Starts (Briefing.com consensus 1.365 mln; prior 1.358 mln) and Building Permits (Briefing.com consensus 1.445 mln; prior 1.473 mln) at 8:30 a.m. ET.

Overseas:

• Europe: DAX +0.2%, FTSE -1.0%, CAC -0.6%
• Asia: Nikkei -0.4%, Hang Seng -1.4%, Shanghai -0.7%

Commodities:

• Crude Oil -3.64 @ 72.92
• Nat Gas -0.13 @ 3.23
• Gold +21.20 @ 1987.60
• Silver +0.40 @ 23.93
• Copper -0.02 @ 3.70

After-Hours Spotlight:

• Applied Materials (AMAT) beats by $0.13, beats on revs; guides Q1 EPS in-line, revs in-line... AMAT down 7.2%
• ChargePoint (CHPT) names new CEO, CFO steps down; lowers Q3 revenue guidance substantially; says its core markets of North America and Europe both came under pressure late in Q3... CHPT down 26.1%
• Compass Minerals (CMP) reports Q3 (Sep) results, beats on revs... CMP down 4.4%
• Dolby Labs (DLB) misses by $0.13, reports revs in-line; guides Q1 EPS below consensus, revs below consensus; guides FY24 EPS below consensus, revs below consensus... DLB down 4.4%
• Gap (GPS) beats by $0.39, beats on revs, comps of -2%; guides Q4 revs below consensus; reaffirms FY24 revs guidance... GPS up 16.1%
• Ross Stores (ROST) beats by $0.11, beats on revs, comps +5%; guides Q4 EPS in-line... ROST up 5.7%

Fair Value for Friday, November 17:

• S&P 500: 4,523
• Nasdaq 100: 15,894
• DJIA: 35,014

For a full rundown of today's market and after hours developments, see Live In Play

• Earnings/Guidance (Full Earnings Calendar):
  • Aegon N.V. (AEG) provides Q3 trading update
  • Alibaba (BABA) beats by $0.35, reports revs in-line
  • Arcos Dorados (ARCO) beats by $0.06, beats on revs
  • Bath & Body Works (BBWI) beats by $0.13, reports revs in-line; guides Q4 EPS below consensus, revs below consensus
  • Berry Global (BERY) beats by $0.14, misses on revs; guides FY24 EPS below consensus
  • Borr Drilling (BORR) reports Q3 results; beats on revs
  • Brady (BRC) beats by $0.05, misses on revs; reaffirms FY24 EPS guidance
  • BrightView (BV) misses by $0.16, reports revs in-line; guides FY24 revs in-line
  • Cisco (CSCO) beats by $0.08, reports revs in-line; guides Q2 EPS and revs below consensus; guides FY24 EPS and revs below consensus; slowdown of new product orders in Q1
  • Copa Holdings (CPA) beats by $0.63, reports revs in-line
  • Corporación América Airports (CAAP) reports Q3 (Sep) results, beats on revs (two ests)
  • Dole plc (DOLE) beats by $0.13, misses on revs
  • FMC Corp (FMC) issues in-line FY24 revenue guidance ahead of Investor Day
  • Gambling.com Group Ltd. (GAMB) beats by $0.03, beats on revs; reaffirms FY23 revs guidance
  • Gold Fields (GFI) in slide presentation reports H1 gold production of 158,657 ounces; EBITDA A$123 million EBITDA Margin 54%; net profit $56 million
  • Hillenbrand (HI) beats by $0.09, beats on revs; guides Q1 EPS below two analyst estimate; guides FY24 EPS in-line, revs above consensus
  • J&J Snack Foods (JJSF) beats by $0.01, beats on revs
  • Kulicke & Soffa (KLIC) beats by $0.08, beats on revs; guides Q1 EPS below consensus, revs below consensus
  • Macy's (M) beats by $0.21, beats on revs; guides FY24 EPS above consensus, revs in-line
  • Maxeon Solar (MAXN) reports Q3 (Sep) results, revs in-line; guides Q4 revs below consensus
  • MAXIMUS (MMS) beats by $0.16, reports revs in-line; guides FY24 EPS above consensus, revs in-line
  • NetEase (NTES) beats by RMB2.43, reports revs in-line; CFO resigns for personal reasons
  • NICE (NICE) beats by $0.12, beats on revs; guides FY23 EPS above consensus, revs in-line
  • Palo Alto Networks (PANW) beats by $0.22, beats on revs; guides Q2 EPS above consensus, revs in-line; guides FY24 EPS above consensus, reaffirms FY24 revs guidance; lowers FY24 billings guidance
  • Robinhood Markets (HOOD) reports October 2023 operating data; Assets Under Custody at end of October down 2% from September
  • Shoe Carnival (SCVL) misses by $0.17, reports revs in-line; guides Q4 EPS below consensus, revs below consensus
  • Sociedad Quimica y Minera (SQM) misses by $0.35, misses on revs
  • Sonos (SONO) beats by $0.11, beats on revs; guides FY24 revs below consensus; authorizes common stock repurchase program of up to $200 mln
  • Spire (SR) reports Q4 (Sep) results, misses on revs
  • STAAR Surgical (STAA) provides investor updates in presentation; sees CAGR 2024-2026 15-20%, 2026 sales approx. $500-550 mln
  • Stratasys (SSYS) beats by $0.01, beats on revs; guides FY23 EPS below consensus, revs below consensus
  • Tetra Tech (TTEK) beats by $0.34, beats on revs; guides Q1 EPS in-line, revs in-line; guides FY24 EPS in-line, revs in-line
  • The Children's Place (PLCE) misses by $0.27, beats on revs; guides Q4 EPS below consensus, revs above consensus
  • VNET Group (VNET) reports Q3 results, misses on revs, lowers FY23 revenue guidance
  • Walmart (WMT) beats by $0.01, reports revs in-line; guides FY24 EPS below consensus, raises FY24 revenue guidance; WMT US comps +4.9%
  • Warner Music Group (WMG)  beats by $0.04, reports revs in-line
  • Williams-Sonoma (WSM) beats by $0.33, misses on revs; lowers FY24 revenue guidance
• General News
  • Senator Joe Manchin says he is "absolutely" considering a third party run for president, according to NBC News
  • Senate passes bill 87-11 to fund government through January 19 and February 2, President Biden is expected to sign it
  • White House issues readout of President Joe Biden’s meeting with President Xi Jinping of the People’s Republic of China; two leaders welcomed the resumption of high-level military-to-military communication
  • Three Fed Governors see room to shrink balance sheet further, according to Reuters interviews
  • President Biden says new supply chain agreement will allow US to monitor for supply chain distributions before they occur; platform with China will be a template for future economic cooperation
  • 3D Systems (DDD) provides update on restructuring initiative
  • 3M (MMM) reveals Solventum as new name for planned, independent health care company following spin-off
  • AbbVie (ABBV): Results Published in The Lancet Show UBRELVY (ubrogepant) Reduces the Headache Phase of a Migraine Attack When Dosed During the Prodrome of Migraine
  • ADMA BioCenters (ADMA) Receives FDA Approval for its Tenth Plasma Collection Center, Located in Laurel, MD
  • Airbus (EADSY) and Emirates near compromise deal for fewer jets, according to Reuters
  • Amazon (AMZN) and Hyundai Motor Company (HYMTF) announce a broad strategic partnership to bring innovative new experiences to customers
  • Amazon (AMZN) confirms 100% success rate for Project Kuiper Protoflight mission
  • American Software's (AMSWA) subsidiary signs agreement to divest of transportation rating solutions
  • Amgen (AMGN): Q32 Bio will regain full development and commercial rights to bempikibart (previously known as ADX-914) from Amgen
  • Apple Apple (AAPL) push to replace Qualcomm (QCOM) chip set to slip further behind - BloombergTV
  • Ardelyx (ARDX): XPHOZAH (tenapanor) Granted Orphan Drug Designation by U.S. FDA for the Treatment of Pediatric Hyperphosphatemia
  • argenx (ARGX) announces that the European Commission approved SC injectable VYVGART as an add-on to standard therapy for the treatment of generalized myasthenia gravis in adult patients who are anti-acetylcholine receptor antibody positive
  • Astellas (ALPMY) Announces Data from ASPIRO Study in X-linked Myotubular Myopathy Published in The Lancet Neurology
  • ATN International (ATNI) COO Brad Martin to succeed Michael Prior as CEO, who will be transitioning to Executive Chairman, effective January 1; CFO Justin Benincasa to retire, succeeded by Carlos Doglioli
  • Berry Global (BERY) declared a quarterly cash dividend of $0.275 per share, a 10% increase from the previous dividend amount, bringing the new annualized dividend to $1.10/share
  • Blackstone (BX) aiming to borrow millions to increase lending power of $52 bln credit fund, according to Financial Times
  • Bristol-Myers (BMY) receives FDA approval for Augtyro
  • CRISPR Therapeutics (CRSP) and Vertex Pharma (VRTX) announce authorization of the first CRISPR/Cas9 Gene-Edited Therapy, CASGEVY (exagamglogene autotemcel) by the UK MHRA
  • Edison (EIX): Officials say that EIX is responsible for 2022 fire, according to Washington Post
  • Foot Locker (FL) and the NBA announce a multiyear partnership that makes Foot Locker an official league marketing partner in the U.S.
  • Fortinet (FTNT) warns customers of critical command injection bug, according to Bleeping Computer
  • Fusion Pharmaceuticals (FUSN) and BWXT Medical (BWXT unit) entered into a new agreement for the supply of generators to produce actinium-225, a medical isotope used to treat cancer in clinical trials
  • General Motors (GM): UAW deal facing opposition from longstanding employees, according to the New York Times
  • General Motors (GM): Electric delivery startup BrightDrop becomes part of General Motors; GM remains committed to scaling BrightDrop Zevo production, which is expected to resume in the spring of 2024
  • General Motors' (GM) Cruise business suspends internal program which allowed employees to cash out shares of the firm, according to WSJ
  • General Motors (GM) union workers ratify deal with UAW, according to CNBC
  • Global Blue (GB) entered into a share purchase and investment agreement; announces $100 mln strategic equity investment from Tencent
  • Heartland Financial (HTLF) announced strategic sale of investment securities
  • Intercontinental Exchange (ICE): The New York Stock Exchange and the Abu Dhabi Securities Exchange have signed a memorandum of understanding to collaborate on a number of key business activities, including the dual listing of companies on both exchanges
  • Jacobs Engineering (J) is reportedly in advanced talks to merge its government consulting biz with PE-owned Amentum Services, according to Reuters
  • Kulicke & Soffa (KLIC) announces that it received multiple orders for its Thermocompression Bonding solutions, supporting long-term AI opportunities
  • Kulicke & Soffa (KLIC) increases quarterly cash dividend to $0.20/share from $0.19/share
  • Maxeon Solar (MAXN) and SunPower (SPWR) amend supply agreement and resolution of disputes
  • Merck (MRK): FDA approves supplemental label for MRK's Keytruda
  • M/I Homes (MHO) approves an increase in its share repurchase authorization by additional $100 mln
  • Morgan Stanley (MS) files mixed securities shelf offering for an undisclosed amount
  • MorphoSys (MOR) files mixed securities shelf offering for an undisclosed amount
  • Noah Holdings (NOAH) outlines growth strategy and global expansion plans at 2023 investor day
  • Northern Trust (NTRS) selected by Costco Wholesale Corp to provide custody, daily valuation and brokerage services for Costco’s defined contribution retirement plan, with $29 billion in assets
  • Parsons (PSN) and InfiniteTactics launch the Mobile Tactical Edge HPC
  • Philips (PHG) and NYU Langone Health announce 8-year strategic partnership valued up to $115 mln
  • Popular (BPOP) increases quarterly cash dividend ~13% to $0.62/share from $0.55/share
  • Primo Water (PRMW) appoints Robbert Rietbroek as CEO, effective Jan 1
  • PulteGroup (PHM) increases quarterly cash dividend by 25% to $0.20/share
  • ReNew (RNW) has commissioned its first interstate transmission project, the "Koppal Transmission Scheme"
  • SmartRent (SMRT) appoints Daryl Stemm as CFO
  • SoundHound AI (SOUN) discloses material weakness in 10-Q filing
  • SpringWorks Therapeutics (SWTX) announces positive topline results from the phase 2b reneu trial of mirdametinib in NF1-PN
  • Starbucks (SBUX): Thousands of Starbucks workers will go on one day strike today, according to the New York Post
  • Stratasys (SSYS) Announces Changes to Board of Directors
  • Surmodics (SRDX) Announces 24-Month Data from the SWING Trial Presented at VEITHsymposium; also announces TRANSCEND Trial 36-Month Data
  • Tutor Perini (TPC) appointed CFO Gary Smalley to the position of President, effective November 15, 2023
  • Universal Insurance (UVE) declares a special dividend of $0.13/share
  • VNET Group (VNET) announces that Success Flow International Investment Limited and Choice Faith Group Holdings Limited entered into investment agreement with company for $299 mln equity investment
  • Yum China (YUMC) announces 2024 share repurchase programs in the U.S. and Hong Kong for $750 million

(see Upgrades/Downgrades calendar for full list):

• Upgrades:
  • BorgWarner (BWA) upgraded to Buy from Neutral at Guggenheim; tgt $41
  • Catalent (CTLT) upgraded to Outperform from Neutral at Robert W. Baird; tgt raised to $53
  • Commscope (COMM) upgraded to Mkt Perform from Underperform at Raymond James
  • easyJet (ESYJY) upgraded to Overweight from Equal-Weight at Morgan Stanley
  • Goodyear Tire (GT) upgraded to Buy from Hold at Deutsche Bank; tgt raised to $21
  • Intel (INTC) upgraded to Buy from Neutral at Mizuho; tgt raised to $50
  • Installed Building Products (IBP) upgraded to Buy from Neutral at Goldman; tgt raised to $178
• Downgrades:
  • Advance Auto (AAP) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $43
  • Altice USA (ATUS) downgraded to Reduce from Buy at HSBC Securities
  • Asensus Surgical (ASXC) downgraded to Neutral from Overweight at Cantor Fitzgerald
  • BASF AG (BASFY) downgraded to Underperform from Hold at Jefferies
  • Deckers Outdoor (DECK) downgraded to Neutral from Overweight at Piper Sandler; tgt raised to $650
  • Deliveroo plc (DROOF) downgraded to Mkt Perform from Outperform at Bernstein
  • Entain Plc (GMVHY) downgraded to Neutral from Outperform at Exane BNP Paribas
  • Enviva (EVA) downgraded to Mkt Perform from Strong Buy at Raymond James
  • HelloFresh SE (HLFFF) downgraded to Hold from Buy at Deutsche Bank
  • Orsted A/S (DNNGY) downgraded to Hold from Buy at Jefferies
• Others:
  • Accenture (ACN) initiated with a Buy at Redburn Atlantic; tgt $410
  • Amkor (AMKR) initiated with a Buy at B. Riley Securities; tgt $35
  • Carrefour SA (CRRFY) initiated with a Neutral at Goldman
  • Cincinnati Fincl (CINF) initiated with a Perform at Oppenheimer
  • Cognizant Tech (CTSH) initiated with a Neutral at Redburn Atlantic; tgt $68
  • DoorDash (DASH) initiated with a Buy at Deutsche Bank; tgt $125
  • Gen Digital (GEN) initiated with a Buy at BofA Securities; tgt $25
  • Hartford Financial (HIG) initiated with a Perform at Oppenheimer
  • HCI Group (HCI) initiated with an Outperform at Oppenheimer; tgt $100
  • TopBuild (BLD) initiated with a Buy at Goldman; tgt $355

• Econ Data (Friday):
  • 8:30 ET: October Housing Starts (Briefing.com consensus 1.365 mln; prior 1.358 mln) and Building Permits (Briefing.com consensus 1.445 mln; prior 1.473 mln)
• Earnings:
  • Monday (Nov 13)
    • Pre-Market: FTRE GENI HSIC MNDY NABL ROIV SKIN TSEM TSN
      After-Hours: ACM AZTA FSR HROW SLF
  • Tuesday (Nov 14)
    • Pre-Market: ARMK CAE CAMT CSIQ CLBT ENR HD HUYA IHS OCSL ONON PSFE SBH SE TME VIPS WKME
    • After-Hours: HRTX VERX
  • Wednesday (Nov 15)
    • Pre-Market: AAP CTLT DAVA GLBE GFF JD NTES RSKD TGT
    • During Market Hours: TJX
    • After-Hours: CSCO CPA HI JJSF KLIC MAXN MMS PANW SQM SONO TTEK
  • Thursday (Nov 16)
    • Pre-Market: BABA BBWI BERY BRC BV DOLE M NICE SCVL SR SSYS WMT WMG WSM
    • After-Hours: AMAT BZH DLB ESE GPS GLOB POST ROST UGI WWD ZTO
  • Friday (Nov 17)
    • Pre-Market: BJ BKE SPB TWST
    • After-Hours: ATKR