After Hours Report

The S&P 500 (+0.8%) and Nasdaq Composite (+1.8%), which closed above 20,000 for the first time, settled near their session highs. The Russell 2000 (+0.6%) also logged a gain while the Dow Jones Industrial Average fluctuated around its previous close, settling 0.2% lower. Market breadth was broadly positive, reflecting a fairly broad advance, but gains in mega-cap stocks had a disproportionate impact on the S&P 500 and Nasdaq Composite.

Big winners in the mega-cap space included Amazon.com (AMZN 230.26, +5.22, +2.3%), Alphabet (GOOG 196.71, +10.18, +5.5%), Meta Platforms (META 632.68, +13.36, +2.2%), and Tesla (TSLA 424.77, +23.78, +5.9%), all of which hit new record highs today.

Investors are reacting to the November Consumer Price Index (CPI) report, which met expectations and reinforced the market's anticipation of an upcoming rate cut. Total CPI moved higher on a year-over-year basis to 2.7% from 2.6% and core CPI was at 3.3%, which is still above the Fed's 2% inflation target.

The likelihood of a 25 basis point rate cut by the FOMC next week increased. According to the CME FedWatch tool, the probability of a 25 basis point cut stands at 94.9%, up from 88.9% yesterday and 78.1% last week.

Treasury yields initially dropped after the CPI release, but the decline moderated. The 2-year yield fell to 4.12% from 4.17%, and settled the session at 4.16%. The 10-year yield dipped to 4.23% from 4.25%, but settled the cash session at 4.27%.

Earnings reports from several companies since yesterday's close sparked mixed reactions from investors. GameStop (GME 28.97, +2.04, +7.6%) and Stitch Fix (SFIX 6.64, +2.04, +44.4%) were standout winners, with their shares soaring following quarterly results. On the other hand, Macy's (M 16.58, -0.14, -0.8%) and Dave & Buster's (PLAY 29.41, -7.39, -20.1%) logged declines after disappointing earnings reports or guidance.

Other story stocks included General Motors (GM 52.04, -0.70, -1.3%), which traded lower after announcing it will cease funding Cruise's robotaxi development, and GE Vernova (GEV 343.80, +16.41, +5.0%), which raised its FY25 revenue guidance while reaffirming its FY24 revenue and free cash flow outlook.

• Nasdaq Composite: +33.5% YTD
• S&P 500: +27.6% YTD
• S&P Midcap 400: +19.1% YTD
• Russell 2000: +18.1% YTD
• Dow Jones Industrial Average: +17.1% YTD

Reviewing today's economic data: 

• Weekly MBA Mortgage Applications Index 5.4%; Prior 2.8%
• November CPI 0.3% (Briefing.com consensus 0.3%); Prior 0.2%, November Core CPI 0.3% (Briefing.com consensus 0.3%); Prior 0.3%
  • There are two key takeaways from the report. The first is that the report wasn't worse than feared. It was right in-line with expectations; therefore, it did not upset the market's view that the Fed will cut rates another 25-basis points at next week's FOMC meeting. The second key takeaway is in the breakdown of the shelter index (+0.3%), which included the smallest increases for owners' equivalent rent (+0.2%) and the index for rent (+0.2%) since April 2021 and July 2021, respectively. With the lag effect of shelter costs on CPI computations, assumptions are being made that this variable will continue to factor favorably in future CPI reports and help temper future inflation readings.
• Weekly EIA crude oil inventories had a draw of 1.43 million barrels; prior draw of 5.07 million barrels 
• The Treasury Budget for November showed a deficit of $366.8 billion compared to a deficit of $314.0 billion in the same period a year ago. The November deficit resulted from outlays ($668.5 billion) exceeding receipts ($301.8 billion). The Treasury Budget data are not seasonally adjusted so the November deficit cannot be compared to the October deficit of $257.5 billion.
  • The key takeaway from the report is its worsening condition, which was driven in part by a large outlay for net interest that exceeded the outlay for national defense.

Looking ahead to Thursday, market participants receive the following data:

• 8:30 ET: November PPI (Briefing.com consensus 0.3%; prior 0.2%), Core PPI (Briefing.com consensus 0.2%; prior 0.3%), weekly Initial Claims (Briefing.com consensus 220,000; prior 224,000), and Continuing Claims (prior 1.871 mln)
• 10:30 ET: Weekly natural gas inventories (prior -30 bcf)

Overseas:

• Europe: DAX +0.4%, FTSE +0.3%, CAC +0.4%
• Asia: Nikkei +0.1%, Hang Seng -0.8% Shanghai +0.3%

Commodities:

• Crude Oil +1.89 @ 70.35
• Nat Gas +0.20 @ 3.38
• Gold +38.60 @ 2756.60
• Silver +0.23 @ 32.95
• Copper -0.01 @ 4.26

After-Hours Spotlight:

• Adobe (ADBE) beats by $0.14, beats on revs; guides Q1 EPS in-line, revs below consensus; guides FY25 EPS below consensus, revs below consensus... ADBE down 8.0%
• Chewy (CHWY) announces $500 million public offering of Class A common stock by selling stockholder Buddy Chester and concurrent share repurchase... CHWY down 2.9%
• Kroger (KR) terminates merger agreement with Albertsons (ACI), approves new $7.5 bln share repurchase program, and announces merger debt redemption... KR up 2.8%
• Oxford Industries (OXM) misses by $0.20, misses on revs; guides Q4 EPS below consensus, revs in-line... OXM down 5.0%
• Robinhood Markets (HOOD) reports November 2024 operating data; Assets Under Custody (AUC) up 22% from October to $195 bln... HOOD up 1.3%

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

• Earnings/Guidance (Full Earnings Calendar):
  • Booking Holdings (BKNG) estimates previously announced restructuring will reduce annual run rate expenses by around $400-450 mln versus 2024 expense base over the next three years
  • Bread Financial (BFH) provides performance update for November 2024
  • British American Tobacco (BTI) on track to meet FY24 guidance
  • Cognyte Software (CGNT) misses by $0.08 (two estimates), beats on revs; guides FY25 EPS above two analyst estimate, revs above two analyst estimate
  • Dave & Buster's (PLAY) misses on EPS, misses on revs, comps -7.7%; CEO Chris Morris resigns; Chairman Kevin Sheehan will also serve as interim CEO
  • Fifth Third (FITB) reaffirms Q4 guidance in slide presentation
  • First Horizon (FHN) provides guidance metrics in slide presentation
  • GameStop (GME) reports Q3 (Oct) results, misses on revs (two ests)
  • GE Vernova (GEV) reaffirms FY24 revenue and free cash flow guidance, raises FY25 revenue guidance, but still below consensus, and raises 2028 outlook; Approves initial $6.0 bln share repurchase authorization
  • Huntington Banc (HBAN) in slide presentation says it is expecting Q4 NII to be approximately flat to modestly higher on a sequential basis
  • Lowe's (LOW) reaffirms FY24 guidance at investor conference; unveils 2025 strategy
  • Macy's (M) beats by $0.01, reports revs in-line; guides FY25 EPS below consensus, revs above consensus
  • Mayville Engineering Company (MEC) announced that Todd Butz, Chief Financial Officer, intends to leave the Company on June 30, 2025; reaffirms FY24 revenue guidance
  • M&T Bank (MTB) provided investor updates in presentation with Q4 guidance for net interest income $1.73 bln +/- with NIMs in the high 3.50-s, Net Charge Offs approx. 40 bps
  • Photronics (PLAB) beats by $0.07, beats on revs; guides Q1 EPS in-line, revs in-line
  • REV Group (REVG) beats by $0.02, reports revs in-line; guides FY25 revs below consensus; Authorized $250.0 mln share repurchase program
  • SkillSoft (SKIL) beats by $1.18 (3 estimates), beats on revs; guides FY25 revenue above consensus (3 estimates)
  • Stitch Fix (SFIX) beats by $0.09, beats on revs; guides JanQ revs above consensus; raises FY25 revenue and EBITDA guidance
  • Suzano S.A. (SUZ) revised Capex estimate
  • Synovus (SNV) provides FY25 guidance in slides ahead of Goldman Sachs Conference; sees +3-7% adjusted revenue growth yr/yr
• General News
  • China considers allowing yuan to weaken in 2025, according to Reuters
  • US mulling additional Russian oil sanctions, according to Bloomberg
  • President-elect Trump nominates Andrew Ferguson to be the next Chair of the FTC; Mark Meador to be a Commissioner on the FTC
  • The Biden administration expecting to announce new tariffs on cleantech imports, according to Financial Times
  • AbbVie (ABBV) completes acquisition of Aliada Therapeutics
  • ACELYRIN, INC. (SLRN) Announces Topline Results From Phase 2b/3 Study of Izokibep for the Treatment of Uveitis
  • ACM Research (ACMR) announces the qualification of its Ultra Fn A Plasma-Enhanced Atomic Layer Deposition (PEALD) Furnace tool
  • ADC Therapeutics (ADCT) Announces Positive Initial Data from LOTIS-7 Clinical Trial Evaluating ZYNLONTA® in Combination with Bispecific Antibody in Patients with Relapsed/Refractory Diffuse Large B-cell Lymphoma
  • Adidas AG (ADDYY) headquarters were raided for second day because of tax investigation, according to FT
  • Air Products (APD): Mantle Ridge files definitive proxy statement and sends letter to Air Products and Chemicals Inc. shareholders highlighting material underperformance, misguided capital allocation strategy, and succession failures
  • Alphabet (GOOG): Intersect Power forms strategic partnership with Google and TPG Rise Climate to co-locate data center load and clean power generation
  • Altria (MO): FDA wants to lower nicotine levels in cigarettes, according to NY Times
  • Amgen (AMGN) raises its quarterly dividend by 5.8% to $2.38/share; annual yield of 3.5%
  • Archer-Daniels (ADM) board of directors extend share repurchase program; program now authorizes the purchase of 300,000,000 shares through Dec 31, 2029
  • Ares Management (ARES): Miami Dolphins announce sale of limited interest to Ares Management for continued investment into South Florida and the Ross Sports and Entertainment portfolio
  • Arrowhead Pharmaceuticals (ARWR) Presents Interim Clinical Data on ARO-CFB for the Treatment of Complement Mediated Diseases
  • Artisan Partners Asset Mgmt (APAM) reports prelim assets under management as of November 30, 2024 totaled $166.8 bln
  • AstraZeneca (AZN): Updated results from the OlympiA Phase III trial showed AstraZeneca and Merck (MRK) demonstrated clinically meaningful prolonged survival benefit in early breast cancer in OlympiA Phase III trial
  • AVANGRID (AGR) will be purchasing over 130 new hybrid bucket trucks over the next three years as it continues to electrify its fleet across its Northeast utilities
  • BAE Systems (BAESY): The U.S. Navy has awarded Data Link Solutions an indefinite delivery, indefinite quantity (IDIQ) award with a ceiling value up to $1 bln for the Multifunctional Information Distribution System Joint Tactical Radio System
  • Banco Bilbao Vizcaya Argentaria (BBVA) confirmed that the ECB communicated its minimum capital requirements for 2025
  • Banco Santander (SAN) has been informed by the ECB after following its Supervisory Review and Evaluation Process of its decision regarding the minimum prudential capital requirements effective as of 1 January 2025
  • Boeing (BA) awarded $450 mln U.S. Air Force contract
  • Bristol-Myers (BMY): SystImmune to present updated BL-B01D1 data in breast cancer at SABCS Congress 2024
  • Candel Therapeutics (CADL) announces results from a multicenter phase 3 clinical trial evaluating CAN-2409 viral immunotherapy in localized prostate cancer patients
  • CareDx (CDNA): TC BioPharm (TCBP) partners with CareDx (CDNA) to support achieve clinical trial using AlloCell for pharmacokinetic monitoring of allogeneic cell therapy
  • Celcuity (CELC) Presents Overall Survival Data from Phase 1b Study Evaluating Gedatolisib in Combination with Palbociclib and Endocrine Therapy at the 2024 San Antonio Breast Cancer Symposium
  • Centrais Electricas Brasileiras (EBR) provided litigation update
  • Clean Energy Fuels (CLNE) has been awarded the contract to design and construct a new state-of-the-art hydrogen fueling station for Riverside Transit Agency (RTA) in California
  • Comcast Business (CMCSA) acquires managed services provider Nitel from private equity firm Cinven; Financial terms of the acquisition were not disclosed
  • Critical Metals Corp. (CRML) appoints Steven R Parkes as CFO following the agreed transition of Ms. Melissa Chapman from the role, effective December 9
  • European Wax Center (EWCZ): Board of Directors appoints Chris Morris as Chief Executive Officer; reaffirms FY24 revenue guidance
  • Eve Holding (EVEX) and Signature Aviation have signed a Memorandum of Understanding to research ecosystem requirements as well as the ground services necessary for safe, efficient and scalable Advanced Air Mobility ground operations
  • Exxon Mobil (XOM) announces its Corporate Plan to 2030, creating a platform to further extend the company’s track record of delivering leading shareholder value
  • First Horizon (FHN) announces a multiyear partnership under which the Memphis-based bank becomes a Proud Partner of the Charlotte Hornets
  • Ford Motor (F) and Southern Company (SO) launch six-month pilot to help businesses prepare for electric transition
  • General Motors (GM) to realign its autonomous driving strategy; GM will no longer fund Cruise's robotaxi development work; will raise its ownership in Cruise to more than 97% vs 90% now
  • Google (GOOG, GOOGL) asks FTC to end Microsoft (MSFT) cloud deal with OpenAI, according to The Information
  • Grifols, S.A. (GRFS) expects the closing of notes and RCF extension to occur on or around December 19 and will be leverage neutral
  • Hartford Financial (HIG) is enhancing its relationship with Workday (WDAY) by becoming a strategic Workday Wellness partner
  • Hershey Foods' (HSY) main owner rejected offer from Mondelez (MDLZ) because it was too low, according to Bloomberg
  • Hologic (HOLX) issues statement on USPSTF draft cervical cancer screening guidelines
  • Home Bancshares (HOMB) announces that it has established additional reserves for loan losses as a result of Hurricane Milton
  • Immunocore (IMCR) and EORTC announce enrolment of first patient onto the only active Phase 3 adjuvant trial in uveal melanoma
  • ING Groep (ING) confirmed ECB decision on its 2024 Supervisory Review and Evaluation Process
  • Intel (INTC): S&P downgraded To 'BBB' on slow business recovery and uncertainty from management changes; outlook stable
  • Interactive (IBKR) brokers launches AI-powered news summaries for smarter, faster investment decisions
  • Intl Flavors (IFF) appoints Michael DeVeau, current Senior Vice President, Corporate Finance and Investor Relations, as Executive Vice President and Chief Financial Officer
  • JetBlue (JBLU) aiming to offer first class seats, according to the Wall Street Journal
  • JinkoSolar (JKS) upsizes share repurchase plan
  • Keysight (KEYS) has joined the Intel Foundry Accelerator United States Military, Aerospace and Government Alliance
  • Kimberly-Clark (KMB) realigned internal operating and management structure to streamline supply chain and improve efficiency of corporate and regional overhead cost structures
  • Krispy Kreme, Inc. (DNUT) was notified regarding unauthorized activity on a portion of its information technology systems
  • Kroger (KR) statement responding to Albertsons' (ACI) "baseless" lawsuit
  • Landstar System (LSTR) declares a special one-time cash dividend of $2.00/sh
  • Lionsgate (LGF.A): Anson Funds Management takes stake in Lionsgate and might push for sale, according to Bloomberg
  • LiveOne (LVO) inks multi-year music deals with BMI and ASCAP, restructures $8 mln in payables
  • Lockheed Martin's (LMT) Sikorsky awarded $376 mln U.S. Army contract modification
  • Mannkind (MNKD) announced that the Central Drugs Standard Control Organisation (CDSCO) in India has approved Afrezza (insulin human) Inhalation Powder in adults
  • Marvell (MRVL) announces breakthrough custom HBM compute architecture to optimize cloud AI accelerators
  • Marvell (MRVL) announces the general availability of a 200G per lane optimized transimpedance amplifier and laser driver chipset, enabling 800 Gbps and 1.6 Tbps linear-drive pluggable optics
  • Match Group (MTCH): Additional comments on Investor Day call, mgmt says it expects CAGR of 4%-6% from 2024-2027; gives $3 billion cash flow target by 2027
  • Micron (MU) awarded grants from Commerce Dept for construction of fab facilities
  • Microsoft (MSFT) released new data center design yesterday centered on optimizing AI; to consume zero water for cooling
  • Mid-America Aptmt (MAA) appoints Bradley Hill as President and CEO, effective April 1, 2025; succeeds Eric Bolton, Jr. who is retiring and will serve as Executive Chairman; also raises dividend
  • Morningstar (MORN) appoints Michael Holt as CFO, effective January 1, 2025
  • Myriad Genetics (MYGN) Provides Update on Discussions with UnitedHealthcare regarding Medical Policy for Pharmacogenetic Testing
  • NIKE (NKE) and the NFL announce a landmark 10-year partnership extension, cementing their commitment to shaping the future of football and driving growth, innovation and progress across the sport
  • Nokia (NOK) building IP network to support AI workloads at Nscale’s new sustainable data center
  • Nova Minerals (NVA) Finds Gold up to 141 g/t Au from Rock Samples at the Stibium Antimony-Gold Prospect on its Estelle Gold and Critical Minerals Project, in Alaska
  • Nucor (NUE) increases quarterly cash dividend to $0.55/share from $0.54/share
  • NVIDIA (NVDA) appeal in securities fraud lawsuit was dismissed by Supreme Court
  • Oshkosh (OSK): USPS postmaster general defended plans electrification plans and says the agency will not return funding for EVs, according to Electrek
  • PDD Holdings (PDD): China ordered PDD Holdings to fix refund policy, according to Bloomberg
  • Pharming Group N.V. (PHAR) reports topline data in pediatric clinical trial of leniolisib
  • PlayAGS (AGS) announces that the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, in connection with the previously announced agreement for the Company to be acquired by affiliates of Brightstar Capital Partners for $12.50/share in cash
  • Prudential (PRU) Board of Directors has authorized the repurchase of up to $1.0 billion of its outstanding Common Stock during the period from January 1, 2025 through December 31, 2025
  • Q32 Bio (QTTB) Provides Bempikibart Program Update, Including Next Steps for Advancing Alopecia Areata Development Program
  • Relay Therapeutics (RLAY) Announces Updated Interim Data for RLY-2608 + Fulvestrant Demonstrating Continued Maturation of Clinically Meaningful Progression Free Survival
  • ReNew (RNW) announces receipt of non-binding proposal from Masdar, CPP Investments, ADIA and Sumant Sinha and establishment of a special committee
  • ReposiTrak (TRAK) Welcomes 50 Diverse Suppliers to Rapidly Expanding Food Traceability Network
  • Rogers Corp (ROG) appoints Laura Russell as CFO, effective December 10
  • Royal Caribbean (RCL) increases quarterly dividend to $0.55 per common share from $0.40 per share
  • RTX's (RTX) business, Raytheon, announces that U.S. Army air defense soldiers successfully used the Lower Tier Air and Missile Defense Sensor, or LTAMDS, to guide Patriot Advanced Capability-3 interceptors to defeat cruise and ballistic missile surrogates
  • Sanofi (SNY) reports two combination vaccine candidates for prevention of influenza and COVID-19 granted Fast Track designation in the US
  • Stantec (STN) announces renewal of normal course issuer bid and automatic share purchase plan
  • Synopsys (SNPS) announces industry's first ultra ethernet and UALink IP solutions to connect massive AI accelerator clusters
  • Talen Energy Corporation (TLN) announced upsize of Term Loan B Financing and related repurchase of common stock
  • TD Bank (TD) facing pressure to name executives responsible for money laundering, according to the Wall Street Journal
  • Toro (TTC) increases quarterly cash dividend to $0.38/share from $0.36/share
  • Toronto-Dominion Bank (TD): DOJ says TD insider arrested and charged with facilitating money laundering
  • TotalEnergies SE (TTE) and its partner OQ Alternative Energy, sign andmark agreements to develop 300 MW of renewable energy projects in the country
  • Uber (UBER): Mexico's Lower House of Congress approves gig worker reform affecting workers at Uber, according to Bloomberg
  • Vale S.A. (VALE) confirms final earnings per share
  • VICI Properties (VICI) enters into an amendment and agreement with PURE Canadian Gaming Corp. in connection with the acquisition of the operating assets of PURE by an affiliate of IGP
  • Western Alliance Bancorp (WAL) CEO Kenneth A. Vecchione issued a letter to colleagues and shareholders informing them of a recent medical diagnosis and temporary leave of absence

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

• Upgrades:
  • Amcor (AMCR) upgraded to Buy from Underperform at BofA Securities; tgt $12.50
  • AXIS Capital (AXS) upgraded to Equal Weight from Underweight at Wells Fargo; tgt raised to $89
  • Blackstone Mortgage Trust (BXMT) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $20
  • EastGroup (EGP) upgraded to Strong Buy from Outperform at Raymond James; tgt raised to $200
  • Fox Factory Holding (FOXF) upgraded to Buy from Hold at Stifel; tgt $40
• Downgrades:
  • Ardagh Metal Packaging S.A. (AMBP) downgraded to Underperform from Buy at BofA Securities; tgt lowered to $4
  • The Baldwin Group (BWIN) downgraded to Underweight from Equal Weight at Wells Fargo; tgt lowered to $41
  • Bausch + Lomb (BLCO) downgraded to Neutral from Buy at Citigroup; tgt lowered to $22
  • C3.ai (AI) downgraded to Underweight from Neutral at JP Morgan; tgt $28
  • CEMEX S.A. (CX) downgraded to Underperform from Sector Perform at RBC Capital Mkts; tgt lowered to $5
  • CervoMed (CRVO) downgraded to Underweight from Overweight at Morgan Stanley
  • CervoMed (CRVO) downgraded to Neutral from Buy at Chardan Capital Markets
  • Cogent Biosciences (COGT) downgraded to Hold from Buy at Needham
  • Duolingo (DUOL) downgraded to Neutral from Buy at BofA Securities; tgt raised to $375
  • E2open (ETWO) downgraded to Sell from Neutral at Goldman; tgt lowered to $2.90
  • Editas Medicine (EDIT) downgraded to Equal Weight from Overweight at Wells Fargo; tgt lowered to $4
  • Fastenal (FAST) downgraded to Hold from Buy at Stifel; tgt $86
  • Sprinklr (CXM) downgraded to Neutral from Overweight at JP Morgan; tgt $11
• Others:
  • Agilon Health (AGL) initiated with a Mkt Perform at Bernstein; tgt $2.50
  • American States Water (AWR) initiated with a Neutral at BofA Securities; tgt $85
  • ANI Pharma (ANIP) initiated with an Outperform at Leerink Partners; tgt $80
  • Archer-Daniels (ADM) resumed with an Equal-Weight at Stephens; tgt $55
  • AvidXchange (AVDX) resumed with a Buy at BTIG Research; tgt $14
  • BioNTech (BNTX) initiated with an Overweight at Wells Fargo; tgt $170
  • Bloom Energy (BE) initiated with a Neutral at ROTH MKM; tgt $25
  • California Water (CWT) initiated with a Buy at BofA Securities; tgt $57
  • First Advantage Corp. (FA) initiated with an Outperform at BMO Capital Markets; tgt $20

• Econ Data (Thursday):
  • 8:30 ET: November PPI (Briefing.com consensus 0.3%; prior 0.2%), Core PPI (Briefing.com consensus 0.2%; prior 0.3%), weekly Initial Claims (Briefing.com consensus 220,000; prior 224,000), and Continuing Claims (prior 1.871 mln)
  • 10:30 ET: Weekly natural gas inventories (prior -30 bcf)
• Treasury Auctions:
  • 13:00 ET: $22 bln 30-yr Treasury bond reopening results
• Earnings:
  • Monday (Dec 9)
    • Pre-Market: MOMO
    • After-Hours: BRZE AI CASY MDB ORCL PHR TOL MTN YEXT
  • Tuesday (Dec 10)
    • Pre-Market: ASO AZO DBI FERG GIII OLLI UNFI
    • After-Hours: PLAY GME SFIX
  • Wednesday (Dec 11)
    • Pre-Market: CGNT PLAB REVG
    • After-Hours: ADBE NDSN OXM
  • Thursday (Dec 12)
    • Pre-Market: CIEN LOVE
    • After-Hours: AVGO COST RH
  • Friday (Dec 13)
    • Pre-Market: None
    • After-Hours: None
General Motors: 5,000 members at GM's Arlington, TX assembly plant join UAW strike