After Hours Report

Today's trade featured a negative bias through the entire session. The major indices were trading slightly lower for most of the day before selling picked up in the afternoon. The S&P 500 ultimately settled 1.0% lower, the Nasdaq Composite closed 1.2% below its prior close, the Dow Jones Industrial Average declined 0.9%, and the Russell 2000 settled with a 0.8% loss.

The late deterioration coincided with some mega caps and chipmakers sliding below prior closing levels. Meta Platforms (META 584.88, -11.06, -1.9%), which had been up as much as 1.2% at its best level, and Broadcom (AVGO 175.08, -1.56, -0.9%), which had been up as much as 0.9%, are among the standouts in that respect.

Apple (AAPL 221.69, -5.11, -2.3%) and Amazon.com (AMZN 180.88, -5.63, -3.0%) extended downgrade-related losses in the afternoon. AAPL shares were downgraded to Hold from Buy at Jefferies and AMZN shares were downgraded to Equal Weight from Overweight at Wells Fargo.

Some selling interest was related to profit-taking activity after the solid run of late. The major indices were near record highs and ended last week on an upbeat note following a very strong jobs report for September.

Downside action was also related to ongoing geopolitical worries around a potential escalation between Israel and Iran. This fear manifested in another jump in oil prices. WTI crude oil futures rose 3.7% to $77.18/bbl. The price action in oil was also in response to concerns about Hurricane Milton, which has intensified into a Category 5 hurricane.

The S&P 500 energy sector was boosted by the activity in oil. It was the only sector to close higher today, up 0.4% from Friday. Chevron (CVX 151.13, +0.38, +0.3%) was a winner from the sector after news that it sold interests in the Athabasca Oil Sands Project and Duvernay Shale for $6.5 billion.

The rate-sensitive utilities sector closed with the largest decline, down 2.3%. The communication services sector also fell 2.0%.

Rising market rates also contributed to the selling in equities. The 10-yr yield settled five basis points higher at 4.03% and the 2-yr yield settled seven basis points higher at 4.00%.

• Nasdaq Composite: +19.4% YTD
• S&P 500: +19.4% YTD
• Dow Jones Industrial Average: +11.3% YTD
• S&P Midcap 400: +11.3% YTD
• Russell 2000: +8.2% YTD

Reviewing today's economic data:

• Consumer credit increased by $8.9 billion in August (Briefing.com consensus $12.7 billion) after increasing a revised $26.7 billion (from $25.5 billion) in July.
  • The key takeaway from the report is that revolving credit decreased, suggesting the presence of increased caution among consumers.

Looking ahead, market participants will receive the following data tomorrow:

• 6:00 ET: September NFIB Small Business Optimism (prior 91.2)
• 8:30 ET: August Trade Balance (Briefing.com consensus -$71.3 bln; prior -$78.8 bln)

Overseas:

• Europe: DAX -0.1%, FTSE +0.3%, CAC +0.5%
• Asia: Nikkei +2.1%, Hang Seng +1.6%, Shanghai market closed

Commodities:

• Crude Oil +2.78 @ 77.18
• Nat Gas -0.11 @ 2.74
• Gold -2.00 @ 2665.90
• Silver -0.39 @ 32.01
• Copper -0.01 @ 4.56

After-Hours Spotlight:

• Cal-Maine Foods (CALM) approved $40 mln in new capital projects to further expand the company’s cage-free production capabilities... CALM down 7.5%
• PENN Entertainment (PENN) expects Q3 Retail Operations adjusted EBITDAR to be in the range of $465-475 million; raises Interactive adjusted EBITDA outlook... PENN up 1.5%
• RLI Corp (RLI) estimates pretax net catastrophe losses from Hurricanes Beryl and Helene of $35 to $40 million, to be reflected in Q3

Fair Value for Tuesday, Oct 8:

• S&P 500: 5,744
• Nasdaq 100: 19,991
• DJIA: 42,254

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

• Earnings/Guidance (Full Earnings Calendar):
  • Aviat Networks (AVNW) misses by $0.05, beats on revs; guides FY25 revs in-line but mid-point below consensus
  • Cerence (CRNC) announced that Brian Krzanich has been appointed Chief Executive Officer; reaffirms Q4 guidance
  • Hon Hai Precision (HNHPF) reports September sales increased 10.9% yr/yr to NT$733.02 bln
  • Niu Technologies (NIU) provides sales volumes for Q3; company sold 312,405 units for the quarter
  • Regeneron Pharma (REGN) reports Q3 will include an acquired in-process research and development charge of approximately $56 million
  • The Duckhorn Portfolio (NAPA) beats by $0.04, beats on revs; NAPA to be acquired by Butterfly Equity for $11.10/share in cash
  • United Micro (UMC) reports September sales declined 0.6% yr/yr to NT$18.94 bln
• General News
  • Polling averages across seven battleground states (Arizona, Nevada, Georgia, North Carolina, Wisconsin, Michigan, and Pennsylvania) remain nearly tied with less than one month to go before Election Day, according to the New York Times
  • Israel intensifying and expanding attacks against Hezbollah, according to the New York Times
  • Hurricane Milton expected to impact west coast of Florida as a major hurricane
  • Vice President Harris says she will not ban gas cars if elected, according to the New York Times
  • Former President Trump reverses support for drug pricing proposal, according to Stat News
  • President Biden expected to announce new student loan relief, according to Bloomberg
  • Committee for a Responsible Budget says "Under our central estimate, Vice President Harris’s plan would increase the debt by $3.50 trillion through 2035, while President Trump’s plan would increase the debt by $7.50 trillion"
  • "Joker: Folie à Deux" was a box office disappointment, according to the Wall Street Journal
  • 3M (MMM) told by judge again that PFAS class action lawsuits will be heard in Ohio court, according to Bloomberg
  • AerCap (AER) reports major business transactions during 3Q24; Company signed financing transactions for approximately $10.5 bln
  • Air Products (APD): Activist Mantle Ridge has accumulated a $1+ bln stake, according to the Wall Street Journal
  • Albemarle (ALB) names Netha Johnson COO
  • Alphabet (GOOG): Judge orders GOOG to open application store to additional competition, according to Reuters
  • American Water Works (AWK) learned of unauthorized activity within its computer networks and systems
  • Apple (AAPL) is slowly moving away from annual upgrade schedule for some products, according to Bloomberg
  • AstraZeneca (AZN) reports Airsupra demonstrated statistically significant and clinically meaningful reduction in the risk of severe exacerbations in patients with intermittent or mild persistent asthma in BATURA Phase III trial
  • AstraZeneca (AZN) strengthens its cardiovascular pipeline with agreement for a pre-clinical novel lipid-lowering therapy with CSPC Pharmaceutical Group
  • AstraZeneca's (AZN) AIRSUPRA demonstrated statistically significant and clinically meaningful reduction in the risk of severe exacerbations in patients with intermittent or mild persistent asthma in BATURA Phase III trial
  • Barnes Group (B) discloses Apollo (APO) merger details including termination fees
  • BigBear.ai (BBAI) names Carl Napoletano as COO
  • Biodesix (BDSX) announces new data presentation at CHEST 2024 Annual Meeting and the launch of a complementary clinical study
  • Bit Digital (BTBT) announces monthly production update for September 2024; mines 51.5 Bitcoin
  • Boeing (BA) IAM union says "We want to inform you that your Union Negotiating Committee and Boeing will meet with the Federal Mediation and Conciliation Services (FMCS) to continue mediated negotiations on Monday, October 7, 2024, at 9 AM"
  • Boeing (BA): Italy investigating two companies that supplied unsafe parts to Boeing contractor, according to Ansa
  • Boeing's (BA) Millennium Space Systems completed the Fire-control On Orbit-support-to-the-war Fighter, or FOO Fighter, preliminary design review four months following authorization to proceed
  • BP (BP) ends plan to cut oil and gas output by 2030, according to Reuters
  • Cabaletta Bio (CABA) issued an updated corporate presentation providing additional clarity on its upcoming milestones, including that additional clinical data from the RESET-SLE and RESET-Myositis trials along with initial clinical data from the RESET-SSc trial
  • Caesars Entertainment (CZR) unveils Horseshoe Online Casino launching exclusively in Michigan
  • Canadian Natrl (CNQ) raises quarterly dividend by 7%
  • Cardinal Health (CAH): T2 Biosystems (TTOO) has entered into a multi-year exclusive U.S. agreement with Cardinal Health
  • CarMax (KMX): Manheim says wholesale used-vehicle prices declined in September by 5.3%
  • Cboe Global Markets (CBOE): Precidian to List First ADRhedged Securities in the U.S. on Cboe, Providing Exposure to Individual International Companies with an Embedded Currency Hedge
  • Charles Schwab's (SCHW) Trading Activity Index decreased to 47.10 in September, down from its score of 53.16 in August
  • CleanSpark (CLSK) and Coinmint mutually agree to non-renewal of colocation mining services agreement
  • CNA Financial (CNA) subsidiary entered into a commitment agreement with Metropolitan Life Insurance Company
  • Core Scientific (CORZ) announces September 2024 production and operations updates
  • Cryoport (CYRX) announced the launch of its IntegriCell cryopreservation services solution provided by Cryoport Systems
  • DoubleDown Interactive's (DDI) DDI-US entered into a new Game Development Agreement with DoubleU Games
  • Eco Wave Power Global AB (WAVE) signs a wave energy power station sale agreement with Taiwanese Lian Tat
  • Enbridge (ENB) partners with Microsoft (MSFT) to use AI to drive advancements in safety, emissions reduction, and asset optimization across its operations
  • Ero Copper (ERO) reports temporary power disruption at the Tucumã Operation after severe windstorm
  • Euroseas (ESEA) announces a time charter contract for its 1,732 teu feeder containership, M/V Jonathan P, for a minimum period of 11 to a maximum period of 13 months at the option of the charterer, at a gross daily rate of $20,000
  • eXp World Holdings (EXPI) discloses settlement of litigation
  • Fortuna (FSM) responds to recent media reports concerning Burkina Faso
  • Gain Therapeutics (GANX) Presents Preclinical GT-02287 Data at Neuroscience 2024
  • GE HealthCare (GEHC) Announces Phase I Results for a First-of-its-Kind Macrocyclic Manganese-Based MRI Contrast Agent
  • Generac (GNRC): NHC says Hurricane Milton has intensified into a Category 5 hurricane
  • General Dynamics (GD) awarded a $376.8 mln modification to previously awarded US Navy contract; also awarded a $244 mln US Navy order
  • GFL Environmental (GFL) and OPAL Fuels (OPAL) announced their joint venture Paragon RNG has commenced commercial operations
  • Gilead (GILD) presents additional efficacy, safety and demographic data from PURPOSE 2 Trial at 5th HIV Research for Prevention Conference
  • GlaxoSmithKline (GSK) and Pfizer's (PFE) ViiV Healthcare to triple annual supply of long-acting HIV PrEP for low- and middle-income countries
  • Google (GOOG): TikTok and artificial intelligence applications taking advertising business from Google, according to the Wall Street Journal
  • Gran Tierra Energy Inc.’s (GTE) acquisition of i3 Energy approved by i3 Energy shareholders
  • IAMGOLD (IAG) also provides update on media reports concerning Burkina Faso; confirms Essakane production guidance / cash costs
  • iHeartMedia (IHRT) and Whalar Group announce a unique partnership that will provide creators and marketers additional opportunities to reach their audiences across iHeart’s industry-leading broadcast, podcast, digital, live events and social platforms
  • Indivior (INDV) announces the Prior Approval Supplement for SUBLOCADE injection submitted by Indivior has been granted Priority Review designation by the U.S. Food and Drug Administration
  • Inspired Entertainment (INSE) announces the upgrade of 4,000 Video Lottery Terminals for its long-term partner, OPAP, Greece’s leading gaming company
  • Interactive Brokers (IBKR) announces significant investor interest in Forecast Contracts related to the 2024 US election
  • Intrepid Potash (IPI) CEO Bob Jornayvaz has stepped down following extended medical leave of absence; Company's CFO, Matt Preston, will continue to serve as acting principal executive officer
  • Kratos Defense and Security (KTOS) and Radisys partner on cloud native 5G-NTN OpenSpace to enable seamless satellite access for terrestrial networks
  • Liquidia Technologies (LQDA) confirms United States Supreme Court declines to review rulings that invalidate United Therapeutics’ (UTHR) Patent
  • Lucid Group (LCID) in Q3 it produced 1,805 vehicles and delivered 2,781 vehicles, of which approximately 8% were subject to operating lease accounting
  • Montauk Renewables (MNTK) and Emvolon announce collaboration to transform methane emissions into high-value, carbon-negative fuelv
  • Nexstar (NXST) eliminates position of Chief Revenue Officer in favor of a more streamlined organizational structure
  • Nissan Motor (NSANY) has entered into an agreement to invest in ChargeScape, a joint venture equally owned by BMW (BMWKY / BMWYY), Ford (F) and Honda (HMC)
  • Novo Nordisk A/S (NVO) initiated a share repurchase program
  • Pfizer (PFE): Starboard Value aiming to take stake in Pfizer, according to the Wall Street Journal
  • Pfizer (PFE): CNBC's David Faber says Starboard does have a stake in PFE, but he doesn't believe any actual conversations between Starboard and PFE have actually taken place (see 6:02 Weekend Reading Summary)
  • PDD Holdings (PDD): Temu trying to win over Amazon (AMZN) sellers, according to the Wall Street Journal
  • Philips (PHG) and Siloam Hospitals Group sign AI capability MoU to support Indonesia’s healthcare transformation strategy
  • Philips (PHG): Philips Respironics Issues Additional Usage Instructions for Trilogy Evo Ventilators Related to Use of In-Line Nebulizers
  • Plug Power (PLUG) signed a binding framework agreement with Allied Green Ammonia
  • Public Service's (PEG) PSE&G reached a settlement agreement with the staff of the New Jersey Board of Public Utilities and other parties
  • PubMatic (PUBM) to eliminate staffers, according to Business Insider
  • Regeneron Pharma (REGN) not granted immunity for using patented COVID related technology, according to Bloomberg
  • Rivian (RIVN) wants government loan to fund EV plant in Georgia, according to Bloomberg
  • Sable Offshore Corp. (SOC) provides update on Pacific Pipeline Company Operations
  • Scholar Rock (SRRK) reports Apitegromab met primary endpoint with statistically significant and clinically meaningful improvement in motor function as measured by the gold standard Hammersmith Functional Motor Scale Expanded (HFMSE) for patients with SMA receiving apitegromab versus placebo (current standard of care) at week 52
  • Sirius XM (SIRI): Howard Stern to Interview Vice President Kamala Harris Live on Tuesday, October 8, 2024 at 1:00 pm ET on SiriusXM
  • SKYX Platforms (SKYX) secures $11 mln strategic investment at $2.00/share, preferred stock convertible, led by Global Marriott Hotel-Chain Developer, Lance Shaner
  • Snowflake (SNOW) data breach cases were consolidated in Montana, according to Bloomberg
  • Solaris Resources Inc. (SLSR) reports 87m of 1.23% CuEq, 93m of 1.01% CuEq and 84m of 1.00% CuEq improving modelled grades near surface in MRE
  • Starbucks (SBUX): The United Steelworkers union announces a favourable arbitration ruling for members at the Uptown Waterloo Starbucks store who have reached their first collective agreement with the coffee giant
  • Stellantis (STLA) launches FlexCare, replacing Mopar Vehicle Protection
  • Super Micro Computer (SMCI) is announcing a complete liquid cooling solution that includes powerful coolant distribution units, cold plates, coolant distribution manifolds, cooling towers and end to end management software
  • Territorial Bancorp (TBNK) urges shareholders to vote for Hope Bancorp (HOPE) merger
  • Tesla (TSLA): GEICO tells Tesla that CyberTruck does not meet underwriting guidelines, according to Torquenews
  • TotalEnergies (TTE) mulling entry into copper trading business, according to Financial Times
  • Trinity Biotech (TRIB) announces 'positive' pre-pivotal trial results for its next-generation continuous glucose monitor technology
  • Unilever PLC (UL) aiming to invest in revamp of its European supply chain, according to Reuters
  • Vale S.A. (VALE) reports interruption of operations at the Onça Puma nickel plant
  • Vector Grp (VGR) confirmed the consummation of JT Group (JAPAY unit) offer and the merger on October 7, 2024
  • Wynn Resorts (WYNN) awarded gaming license in the United Arab Emirates, according to Bloomberg

Ratings Changes (see Upgrades/Downgrades calendar for full list):

• Upgrades:
  • Alibaba (BABA) upgraded to Outperform from Neutral at Macquarie; tgt $145
  • Ally Financial (ALLY) upgraded to Overweight from Neutral at JP Morgan; tgt lowered to $40
  • Campbell Soup (CPB) upgraded to Outperform from Mkt Perform at Bernstein; tgt raised to $58
  • Canadian Nat'l Rail (CNI) upgraded to Overweight from Equal Weight at Wells Fargo; tgt $125
  • Coty (COTY) upgraded to Buy from Hold at Jefferies; tgt raised to $12
  • Couchbase (BASE) upgraded to Overweight from Equal Weight at Barclays; tgt $19
  • Coupang (CPNG) upgraded to Outperform from Underperform at Bernstein; tgt $30
  • Dynatrace (DT) upgraded to Overweight from Equal Weight at Barclays; tgt raised to $64
  • Elastic (ESTC) upgraded to Overweight from Equal Weight at Barclays; tgt raised to $95
  • Frontline (FRO) upgraded to Buy from Neutral at BTIG Research; tgt $30
  • Integra (IART) upgraded to Neutral from Sell at BTIG Research
• Downgrades:
  • Amazon (AMZN) downgraded to Equal Weight from Overweight at Wells Fargo; tgt lowered to $183
  • American Express (AXP) downgraded to Neutral from Overweight at JP Morgan; tgt raised to $286
  • AMN Healthcare (AMN) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $48
  • Apple (AAPL) downgraded to Hold from Buy at Jefferies; tgt raised to $212.92
  • Brookdale Senior Living (BKD) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $6
  • Celanese (CE) downgraded to Sector Weight from Overweight at KeyBanc Capital Markets
  • Centuri Holdings (CTRI) downgraded to Underweight from Neutral at JP Morgan; tgt lowered to $16
  • Charles River (CRL) downgraded to In-line from Outperform at Evercore ISI; tgt lowered to $190
  • Ciena (CIEN) downgraded to Neutral from Overweight at JP Morgan; tgt $65
  • Comerica (CMA) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $52
  • Concentra Group Holdings Parent (CON) downgraded to Neutral from Buy at BofA Securities; tgt lowered to $24
  • Denali Therapeutics (DNLI) downgraded to Neutral from Overweight at Cantor Fitzgerald
  • DuPont (DD) downgraded to Underweight from Equal Weight at Barclays; tgt lowered to $84
  • Evotec SE (EVO) downgraded to Hold from Buy at Jefferies
  • Garmin (GRMN) downgraded to Underweight from Equal-Weight at Morgan Stanley; tgt lowered to $138
  • Hershey Foods (HSY) downgraded to Mkt Perform from Outperform at Bernstein; tgt lowered to $205
  • Hershey Foods (HSY) downgraded to Neutral from Buy at UBS; tgt lowered to $209
  • Humana (HUM) downgraded to Hold from Buy at Jefferies; tgt lowered to $253
  • Sprinklr (CXM) downgraded to Underweight from Overweight at Barclays; tgt lowered to $7
• Others:
  • Applied Industrial (AIT) initiated with a Neutral at BofA Securities; tgt $232
  • Avery Dennison (AVY) initiated with an Overweight at Barclays; tgt $250
  • Celldex Therapeutics (CLDX) initiated with a Buy at Citigroup; tgt $70
  • Clover Health (CLOV) initiated with a Neutral at UBS; tgt $4
  • Curbline Properties (CURB) initiated with a Sector Weight at KeyBanc Capital Markets
  • DiaMedica Therapeutics (DMAC) initiated with a Buy at H.C. Wainwright; tgt $7
  • Fastenal (FAST) initiated with a Buy at BofA Securities; tgt $85
  • Foot Locker (FL) initiated with an Accumulate at Gordon Haskett; tgt $27
  • Grainger (GWW) initiated with an Underperform at BofA Securities; tgt $925
  • Immatics N.V. (IMTX) initiated with an Overweight at Piper Sandler; tgt $19

• Econ Data (Tuesday):
  • 6:00 ET: September NFIB Small Business Optimism (prior 91.2)
  • 8:30 ET: August Trade Balance (Briefing.com consensus -$71.3 bln; prior -$78.8 bln)
• Treasury Auctions:
  • 13:00 ET: $58 bln 3-yr Treasury note auction results
• Earnings:
  • Monday (Oct 7)
    • Pre-Market: None
    • After-Hours: NAPA
  • Tuesday (Oct 8)
    • Pre-Market: ACCD PEP
    • After-Hours: None
  • Wednesday (Oct 9)
    • Pre-Market: HELE
    • After-Hours: AZZ
  • Thursday (Oct 10)
    • Pre-Market: DAL DPZ NEOG TLRY
    • After-Hours: None
  • Friday (Oct 11)
    • Pre-Market: BLK BK FAST JPM WFC
    • After-Hours: None
General Motors: 5,000 members at GM's Arlington, TX assembly plant join UAW strike