After Hours Report

It was a somewhat lackluster session in the stock market. The S&P 500 (+0.1%), Dow Jones Industrial Average (+0.1%), and Nasdaq Composite (+0.3%) settled slightly higher than yesterday while the Russell 2000 outperformed, settling 1.0% higher.

Market breadth was positive, but there wasn't a lot of conviction on either side of the tape. Advancers had a roughly 3-to-2 lead over decliners at the NYSE and at the Nasdaq.

The lack of conviction today stemmed from a wait-and-see stance in front of the May Personal Income and Spending report tomorrow at 8:30 ET, which features the Fed's preferred inflation gauges in the form PCE and core-PCE price indexes.

Ongoing buying interest in the mega cap space played an integral role in index-level performance. Shares of Amazon.com (AMZN 197.85, +4.24, +2.2%) moved further into record territory after crossing $2 trillion in market cap. The Vanguard Mega Cap Growth ETF (MGK) logged a 0.3% gain.

Meanwhile, semiconductor-related names acted as a drag on the broader market after Micron's (MU 132.26, -10.13, -7.1%) earnings report. NVIDIA (NVDA 123.99, -2.41, -1.9%) was an influential standout from the space.

Some bank stocks traded higher the Fed's stress test showed that the 31 large banks subject to the test this year have sufficient capital. The SPDR S&P Bank ETF (KBE) closed 1.0% higher and the SPDR S&P Regional Banking ETF (KRE) showed a 1.1% gain.

Still, the S&P 500 financial sector fell 0.3% today.

Treasury yields settled lower in response to this morning's data and a stellar $44 billion 7-yr note sale. The slate of economic releases today included an upward revision to Q1 GDP, the highest level of continuing jobless claims since November 2021, and better-than-expected durable orders growth for May. 

The 10-yr note yield, at 4.33% shortly before 8:30 ET, settled at 4.29%, which is three basis points lower than yesterday. The 2-yr note yield, at 4.76% before 8:30 ET, settled at 4.72%.

• Nasdaq Composite: +19.0% YTD
• S&P 500:+15.0% YTD
• S&P Midcap 400: +5.1% YTD
• Dow Jones Industrial Average: +3.9% YTD
• Russell 2000: +0.6% YTD

Reviewing today's economic data:

• May Adv. Intl. Trade in Goods -$100.6 bln; Prior was revised to -$98.0 bln from -$99.4 bln
• May Adv. Retail Inventories 0.7%; Prior 0.7%
• May Adv. Wholesale Inventories 0.6%; Prior 0.2%
• Weekly Initial Claims 233K (Briefing.com consensus 238K); Prior was revised to 239K from 238K; Weekly Continuing Claims 1.839 mln; Prior was revised to 1.821 mln from 1.828 mln
  • The key takeaway from the report is the elevated level of continuing jobless claims, which suggests laid-off workers are facing longer wait times before finding a new job, which would be a symptom of a softening labor market.
• May Durable Orders 0.1% (Briefing.com consensus -1.2%); Prior was revised to 0.2% from 0.7%; May Durable Orders -ex transportation -0.1% (Briefing.com consensus 0.2%); Prior 0.4%
  • The key takeaway from the report is that new orders for nondefense capital goods excluding aircraft -- a proxy for business spending -- declined 0.6% month-over-month.
• Q1 GDP- Third Estimate 1.4% (Briefing.com consensus 1.3%); Prior 1.3%; Q1 GDP Deflator - Third Estimate 3.1% (Briefing.com consensus 3.1%); Prior 3.0%
  • The key takeaway from the report is that it is dated (we're just days away from the end of Q2) so its impact should be limited; however, the slowdown in personal spending is noteworthy in light of more anecdotal evidence in the interim that suggests consumers, in aggregate, are reining in their discretionary spending.
• May Pending Home Sales -2.1% (Briefing.com consensus 2.3%); Prior -7.7%

Friday's economic calendar features the Fed's preferred inflation gauge in the form of PCE Price Indexes in the May Personal Income and Spending report. Other data tomorrow include:

• 9:45 ET: June Chicago PMI (prior 35.4)
• 10:00 ET: Final June University of Michigan Consumer Sentiment (Briefing.com consensus 65.6; prior 65.6)

Overseas:

• Europe: DAX +0.3%, FTSE -0.6%, CAC -1.0%
• Asia: Nikkei -1.0%, Hang Seng -2.1%, Shanghai -0.9%

Commodities:

• Crude Oil +0.82 @ 81.73
• Nat Gas +0.06 @ 2.68
• Gold +23.40 @ 2336.50
• Silver +0.33 @ 29.26
• Copper -0.03 @ 4.35

After-Hours Spotlight:

• Accolade (ACCD) beats by $0.13, beats on revs; guides Q2 revs below consensus; guides FY25 revs below consensus... ACCD down 27.1%
• Kura Sushi (KRUS) guides MayQ sales below consensus; lowers FY24 revenue guidance... KRUS down 12.0%
• Leidos (LDOS) awarded $477 mln NASA contract for cargo mission support... LDOS up 1.9%
• NIKE (NKE) beats by $0.15, misses on revs, gross margin increased 110 bps, North America revenue decreased 1%... NKE down 6.2%
• Nokia (NOK) confirms deal to acquire Infinera (INFN) for $6.65/share or an enterprise value of $2.3 bln; deal financed from Nokia's cash on hand... NOK down 2.1%; INFN up 21.7%

Fair Value for Friday, June 27:

• S&P 500: 5,547
• Nasdaq 100: 20,050
• DJIA: 39,425

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

• Earnings/Guidance (Full Earnings Calendar):
  • Acuity Brands (AYI) beats by $0.07, misses on revs
  • Acuity Brands (AYI) comments from Q3 conference call
  • AeroVironment (AVAV) beats by $0.21, beats on revs; guides FY25 EPS in-line, revs in-line
  • Apogee Enterprises (APOG) beats by $0.40, reports revs in-line; guides FY25 EPS above consensus, reaffirms FY25 revs guidance
  • BlackBerry (BB) beats by $0.02, beats on revs; guides Q2 EPS in-line, revs in-line; guides FY25 EPS in-line, revs in-line
  • Concentrix (CNXC) beats by $0.06, beats on revs; guides Q3 EPS below consensus, revs in-line; guides FY24 EPS in-line, revs in-line
  • Franklin Covey (FC) beats by $0.04, beats on revs
  • H.B. Fuller (FUL) beats by $0.09, reports revs in-line; guides FY24 EPS in-line, revs in-line
  • Jefferies (JEF) beats by $0.01, beats on revs; increases dividend 16.7%
  • Levi Strauss (LEVI) beats by $0.05, reports revs in-line; reaffirms FY24 EPS guidance, revs guidance; increases dividend
  • Lindsay Corp (LNN) beats by $0.68, misses on revs
  • McCormick (MKC) beats by $0.10, reports revs in-line; reaffirms FY24 EPS guidance, revs guidance
  • Micron (MU) beats by $0.14, beats on revs; guides Q4 EPS in-line, revs in-line
  • MillerKnoll (MLKN) beats by $0.13, misses on revs; guides FY25 EPS in-line, revs in-line
  • Rivian Automotive (RIVN) provides updates ahead of Investor Day today -- will reaffirm 2024 guidance for vehicles produced and adjusted EBITDA; will announce estimated vehicle production and deliveries for the quarter
  • Rivian Automotive (RIVN) provides additional guidance in presentation; estimates Q2'24E production 9.1-9.3k, deliveries 13.0-31.3k
  • Simply Good Foods (SMPL) beats by $0.02, reports revs in-line, reaffirms legacy Simply Good Foods, excluding OWYN, net sales outlook for FY24
  • Target Hospitality (TH) lowers FY24 revenue guidance
  • Walgreens Boots Alliance (WBA) misses by $0.05, beats on revs; lowers FY24 EPS guidance below consensus, reflecting challenging pharmacy industry trends and a worse-than-expected U.S. consumer environment
  • Weyerhaeuser (WY) in slide presentation expects annual CapEX of $420-440 mln through 2025
  • Worthington Steel (WS) beats by $0.30 (two ests), beats on revs (two ests)
• General News
  • Former President Trump leads President Biden by an average of 1.5 points ahead of tonight's presidential debate, according to RCP
  • FiveThirtyEight founder Nate Silver says there is a 65.7% chance former President Trump wins the 2024 election, according to USA Today
  • Fed Stress Test: 31 large banks subject to the test this year have sufficient capital
  • Supreme Court blocks EPA rule targeting cross state pollution measures
  • Supreme Court blocks Purdue Pharma's settlement that shielded the Sackler family from lawsuits from the opioid crisis
  • Supreme Court rules that SEC can no longer use in house courts to pursue sanctions
  • Treasury issues additional sanctions on Iran
  • AbbVie (ABBV) acquires Celsius Therapeutics, a privately held biotechnology company pioneering new therapies for patients with inflammatory disease for $250 mln in cash
  • AbbVie (ABBV): U.S. Food and Drug Administration grants second approval for EPKINLY (epcoritamab-bysp) to treat patients with relapsed or refractory follicular lymphoma
  • Agenus (AGEN) announces that the Cancer Therapy Evaluation Program is accepting Letters of Intent to conduct clinical studies using botensilimab which is being developed by CTEP as an anticancer agent in collaboration with Agenus Inc.
  • Alibaba (BABA): Alibaba.com Commits to Scaling AI Tools for MSMEs
  • Alphabet (GOOG): Google Cloud expands grounding capabilities on Vertex AI
  • Altria (MO) Announces PMTA Submission for on! PLUS Nicotine Pouches
  • Amazon (AMZN): Amazon Clinic is now Amazon One Medical’s Pay-per-visit telehealth service—here’s what it means for our customers
  • American Electric (AEP) elects William J. Fehrman as president and CEO, effective Aug 1, 2024
  • Apple (AAPL) is exploring methods to make iPhone batteries easier to replace, according to The Information
  • Arogo Capital Acquisition Corp. (AOGO) and Ayurcann Holdings Corp. (AYURF) announce SPAC combination agreement
  • Assured Guaranty Municipal (AGO) insures another $800 million for JFK International Airport’s New Terminal One Project
  • Bayer AG (BAYRY) and Rad AI announce collaboration agreement that brings together Rad AI’s generative AI radiology reporting solutions and patient follow-up management solution with Bayer’s Calantic Digital Solution Platform
  • Biogen (BIIB) plans to spend $8 bln on deals this year, according to End Points News
  • Boeing (BA) believes increased inspections are helping with 737 Max production quality, according to the New York Times
  • Boeing (BA) resuming widebody deliveries to China, according to Reuters
  • Boeing (BA) rejected claim that NASA crew is "stranded" on the International Space Station, according to Financial Times
  • Boeing (BA): National Transportation Safety Board will sanction Boeing for disclosing details on investigation, according to Reuters
  • Boeing (BA): NTSB confirms that Boeing was sanctioned for sharing non-public investigative information with media on 737 Max 9 door plug investigation
  • Boston Properties (BXP): Nearly 25% of office space will be vacant by 2026, according to Bloomberg
  • BP (BP) aiming to impose hiring freeze and pause new offshore wind projects, according to Reuters
  • Canadian Nat'l Rail (CNI) train derailed in Illinois, according to WGN TV
  • Canadian Nat'l Rail (CNI): White powdery substance leaking from car after train derailment deemed non-hazardous, according to ABC News
  • Carter Bank & Trust (CARE) released statement regarding the dismissal of lawsuits filed by WV Governor Jim Justice and related entities
  • Centuri Holdings (CTRI) announces that Bill Fehrman will step down as President and CEO to take the CEO role at American Electric Power (AEP); Paul Caudill appointed interim CEO
  • CGI Group (GIB) selected as a technology partner to help advance the Federal Bureau of Investigation's modernization initiatives
  • Chewy (CHWY) announces $500 million repurchase of shares from BC Partners
  • Coeur Mining (CDE) reports "positive" results from its multi-year exploration drilling and development program at the Kensington underground gold mine in Southeast Alaska
  • Danaher (DHR): FDA granted marketing authorization to Cepheid for the Xpert HCV test and GeneXpert Xpress System; Test enables single-visit testing and treatment for hepatitis C
  • Elanco Animal Health (ELAN) announced updates to the expected FDA approval timelines for Zenrelia and Credelio Quattro; 2024 Innovation sales guidance increased
  • Fluence (FLNC) and MW Storage deepen partnership to deliver their third energy storage project in Finland
  • fuboTV (FUBO) announces the launch of its app on Comcast’s (CMCSA) entertainment platforms Xfinity Flex, Xumo Stream Box and Xumo TV
  • Genmab (GMAB) and AbbVie (ABBV) receive FDA approval for EPKINLY
  • Gogo (GOGO) announced that more than 1,000 successful AVANCE system software updates have been completed globally using Gogo's over-the-air feature
  • Google (GOOG): YouTube in discussions with record labels to license songs for artificial intelligence, according to Financial Times
  • Grifols, S.A. (GRFS) provides liquidity details following credit rating agencies updates and the news published in media; continues to maintain a strong liquidity position
  • HomeStreet (HMST): Blue Lion Capital encourages HomeStreet Board to remove management team change in control payments as part of FSUN merger
  • i-80 Gold (IAUX) provides positive metallurgical results from Ruby Hill and Golden Hill
  • Infosys (INFY) settled charges that it not have adequate controls to prevent insider trading, according to Reuters
  • JPMorgan Chase (JPM) Comments on the Federal Reserve’s 2024 Stress Test Results
  • Keysight (KEYS) announced that Allion Labs has selected Keysight as its test partner for Thunderbolt 5 product certification testing
  • Kroger (KR) increases quarterly cash dividend 10% to $0.32/share from $0.29/share
  • Largo Resources (LGO) announces the promotion of David Harris to Chief Financial Officer, who has served as Corporate Controller of Largo since 2015
  • Lockheed Martin (LMT) awarded $534 mln U.S. Navy contract modification
  • McCormick (MKC) promotes Marcos Gabriel to Executive Vice President and CFO, effective December 1; succeeds Mike Smith who is retiring on February 28, 2025
  • Merck (MRK): Patritumab Deruxtecan BLA submission receives Complete Response Letter from FDA due to inspection findings at third-party manufacturer
  • Natera (NTRA) announces DECIPHER: A Phase II, single-arm adjuvant trial in gastroesophageal cancer
  • New Mountain Finance (NMFC) amended equity distribution agreement
  • Novonix (NVX) granted patent for all-dry, zero-waste cathode synthesis
  • Novo Nordisk A/S (NVO) aiming to restrict sales of Wegovy in China, according to Bloomberg
  • Pfizer (PFE) and BioNTech (BNTX) receive positive CHMP Opinion for Omicron JN.1-adapted COVID-19 Vaccine in the European Union
  • Popular (BPOP) filed mixed securities shelf offering
  • Q2 Holdings (QTWO) announces that Massachusetts-based Avidia Bank has selected Q2 to modernize and enhance its digital banking experience for its customers
  • Quanterix (QTRX): Portolan discloses increased passive stake to 5.01% (approx. 1.9 mln shares, up from 1.2 mln share holding)
  • Regeneron Pharma (REGN): Dupixent (dupilumab) Positive Phase 3 Data in children 1 to 11 years of age with eosinophilic esophagitis published in the New England Journal of Medicine
  • RH (RH) announces that Chairman & CEO Gary Friedman completed the purchase of $10 million of RH stock at an average price per share of $216.10 representing 46,274 shares
  • Rocket Companies (RKT) appoints Heather Lovier as COO; succeeds Bill Emerson who is staying on as President
  • Seabridge Gold (SA) reported its first mineral resource estimate (MRE) for the Bronson Slope deposit at its 100% owned Iskut project in the Golden Triangle Area of northwestern British Columbi
  • Silence Therapeutics (SLN) Announces Positive Results from Ongoing SANRECO Phase 1 Study of Divesiran in Polycythemia Vera Patients
  • SoftBank (SFTBY) fund will invest in Perplexity AI at $3 bln valuation, according to Bloomberg
  • Stellantis (STLA) completes second tranche of 2024 share buyback program
  • Super Group (SGHC) declared the first cash dividend on its ordinary shares of $0.10 per share
  • Talen (TLNE) statement on Exelon/AEP objection to Susquehanna ISA
  • Target (TGT) lowers threshold for workers to stop theft to $50, according to Bloomberg
  • UBS AG (UBS): FIFA is working with UBS to find investors for streaming service, according to Bloomberg
  • UL Solutions Inc. (ULS) plans to construct advanced automotive and battery testing center in Korea to serve the automotive industry
  • Verona Pharma (VRNA): FDA approves Ohtuvayre
  • Vigil Neuroscience (VIGL) announces $40 million strategic investment from Sanofi (SNY)
  • X4 Pharmaceuticals (XFOR) announces positive interim clinical data from ongoing six-month phase 2 trial of mavorixafor in chronic neutropenia and initiation of pivotal phase 3 CN trial

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

• Upgrades:
  • BNY Mellon (BK) upgraded to Outperform from Mkt Perform at Keefe Bruyette; tgt raised to $70
  • Petrobras (PBR) upgraded to Buy from Neutral at BofA Securities
  • Qiagen (QGEN) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $50
• Downgrades:
  • 10x Genomics (TXG) downgraded to Peer Perform from Outperform at Wolfe Research
  • Agilent (A) downgraded to Peer Perform from Outperform at Wolfe Research
  • Centuri Holdings (CTRI) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $21
  • Lyell Immunopharma (LYEL) downgraded to Neutral from Buy at H.C. Wainwright; tgt lowered to $1
  • Rio Tinto (RIO) downgraded to Hold from Buy at Berenberg
  • U.S. Bancorp (USB) downgraded to Neutral from Overweight at JP Morgan; tgt $43.50
• Others:
  • ACADIA Pharmaceuticals (ACAD) initiated with an Outperform at BMO Capital Markets; tgt $31
  • Arcadium Lithium (ALTM) initiated with a Neutral at Goldman; tgt $4.30
  • BWX Technologies (BWXT) initiated with a Buy at Janney; tgt $113
  • CARGO Therapeutics (CRGX) initiated with an Overweight at Piper Sandler; tgt $37
  • Crescent Energy Company (CRGY) initiated with an Overweight at KeyBanc Capital Markets; tgt $16
  • Denison Mines (DNN) initiated with a Buy at ROTH MKM
  • Dianthus Therapeutics (DNTH) initiated with an Overweight at Cantor Fitzgerald
  • Dynatrace (DT) initiated with a Neutral at Piper Sandler; tgt $50
  • Exact Sciences (EXAS) initiated with a Sector Outperform at Scotiabank; tgt $70
  • Grab (GRAB) initiated with an Outperform at Mizuho; tgt $5
  • Hologic (HOLX) initiated with an Overweight at Stephens; tgt $87
  • Jasper Therapeutics (JSPR) initiated with a Buy at Stifel; tgt $86
  • Kyndryl (KD) initiated with an Outperform at Oppenheimer; tgt $33
  • Myriad Genetics (MYGN) initiated with a Sector Outperform at Scotiabank; tgt $29
  • Nautilus Biotechnology (NAUT) initiated with a Buy at Guggenheim; tgt $6
  • Neurogene (NGNE) initiated with an Outperform at BMO Capital Markets; tgt $65
  • PagerDuty (PD) initiated with a Neutral at JP Morgan; tgt $24
  • SOPHiA GENETICS SA (SOPH) initiated with a Buy at Guggenheim; tgt $6
  • Taysha Gene Therapies (TSHA) initiated with an Outperform at BMO Capital Markets; tgt $5
  • Vertex Pharma (VRTX) initiated with a Buy at Redburn Atlantic; tgt $545
  • Viking Therapeutics (VKTX) initiated with an Overweight at Morgan Stanley; tgt $105

• Econ Data (Friday):
  • 8:30 ET: May Personal Income (Briefing.com consensus 0.4%; prior 0.3%), Personal Spending (Briefing.com consensus 0.3%; prior 0.2%), PCE Prices (prior 0.3%), and Core PCE Prices (Briefing.com consensus 0.1%; prior 0.2%)
  • 9:45 ET: June Chicago PMI (prior 35.4)
  • 10:00 ET: Final June University of Michigan Consumer Sentiment (Briefing.com consensus 65.6; prior 65.6)
• Earnings:
  • Monday (June 24)
    • Pre-Market: None
    • After-Hours: None
  • Tuesday (June 25)
    • Pre-Market: CCL SNX
    • After-Hours: FDX PRGS WOR
  • Wednesday (June 26)
    • Pre-Market: GIS PAYX UNF
    • After-Hours: AVAV CNXC FUL LEVI MU MLKN WS
  • Thursday (June 27)
    • Pre-Market: AYI APOG LNN MKC SMPL WBA
    • After-Hours: ACCD NKE
  • Friday (June 28)
    • Pre-Market: None
    • After-Hours: None
General Motors: 5,000 members at GM's Arlington, TX assembly plant join UAW strike