After Hours Report

The groundwork for the start of today's session was laid after the close on Friday when Moody's announced a downgrade of its U.S. credit rating to Aa from Aaa due to the increase in government debt and interest payment ratios that are significantly higher than similarly rated sovereigns.

That headline shock precipitated a spike in longer-dated Treasury yields, a 1.0% decline in the U.S. Dollar Index, and selling interest in the equity futures market.

The 10-yr note yield, which settled Friday's session at 4.44%, went as high as 4.56%, while the 30-yr bond yield, which settled Friday's session at 4.90%, kissed 5.04%. And then the selling stopped.

Treasury yields reversed, with the 10-yr note yield settling at 4.47% and the 30-yr bond yield settling at 4.94%. Stocks, in turn, benefited once again from buy-the-dip interest and lingering optimism about the possibility of Congress passing the large reconciliation bill. The U.S. Dollar Index was down 0.7%.

The final numbers don't connote a picture of strength on their own, but the stock market's relative strength is rooted in the understanding that the Dow, Nasdaq, S&P 500, and Russell 2000 had been down as much as 0.7%, 1.4%, 1.1%, and 1.5%, respectively.

Once the headline shock of the Moody's downgrade wore off, participants settled into the notion that it wasn't really a "surprise," given that Standard & Poor's and Fitch Ratings had downgraded their U.S. credit ratings years earlier. That thinking presumably fostered some short-covering activity in the Treasury market that extended to stocks, which saw the S&P 500 record its sixth straight winning session.

There wasn't much corporate news governing today's trade, which had an M&M feel to it (macro and mechanical).

JPMorgan Chase (JPM 264.94, -2.58, -1.0%) slightly increased its FY25 net interest income guidance; Walmart (WMT 98.14, -0.10, -0.1%) garnered a rebuke from President Trump that it should "eat the tariffs;" the CEO and CFO of UnitedHealth Group (UNH 315.89, +23.98, +8.2%) collectively bought stock worth approximately $30 million; and JPMorgan downgraded Netflix (NFLX 1191.64, +0.11, +0.01%) to Neutral from Overweight.

Seven S&P 500 sectors finished higher. The health care sector (+1.0%) led the way. The next biggest gainer was the consumer staples sector, which gained a modest 0.4%. The energy sector (-1.6%) was in the losing category and was the only sector down more than 0.3%.

Market breadth improved as the session continued but still favored decliners by a narrow margin at the NYSE and Nasdaq when the closing bell rang.

Today's economic data was limited to the Leading Economic Index for April, which registered a 1.0% decline (Briefing.com consensus -0.7%) versus a downwardly revised 0.8% decline (from -0.7%) in March.

Overseas:

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

Commodities:

• Crude Oil +0.15 @ 62.12
• Nat Gas -0.24 @ 3.45
• Gold +48.00 @ 3234.80
• Silver +0.16 @ 32.52
• Copper +0.09 @ 4.67

After-Hours Spotlight:

• Agilysys (AGYS) beats by $0.25, beats on revs; guides FY26 revs below consensus... AGYS up 1.8%
• Dollar Tree (DLTR): In partnership with Brigade Capital Management and Macellum Capital Management, announces that Duncan MacNaughton will serve as Chairman and Chief Executive Officer of Family Dollar... DLTR up 0.8%
• FedEx (FDX) announces leadership roles as it makes progress to separate its LTL freight division; John A. Smith, Chief Operating Officer, U.S. and Canada, of Federal Express, has been selected to serve as President and CEO of FedEx Freight... FDX down 1.8%
• Ryman Hospitality (RHP) announces definitive agreement to purchase the JW Marriott Phoenix Desert Ridge Resort & Spa in Phoenix, Arizona, for $865 mln; announces offering of 2.3 mln shares of common stock... RHP down 3.2%
• Transcat (TRNS) beats by $0.09, reports revs in-line... TRNS up 3.5%

Fair Value for Tuesday, May 20:

• S&P 500: 5,982
• Nasdaq 100: 21,521
• DJIA: 42,889

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

• Earnings/Guidance (Full Earnings Calendar):
  • BioNTech (BNTX) reaffirms FY25 revenue guidance in slide presentation for annual meeting
  • Carrier Global (CARR) provides medium-term financial outlook at Investor Day
  • Diageo plc (DEO) provides Q3 trading update; provides FY25-26 guidance; discusses tariff impacts
  • JPMorgan Chase (JPM) provides banking metrics at investor day; sees 2025 NII of $94.5 bln; sees FY25 adj expenses of $95 bln; sees ROTCE target of 17%
  • Target Hospitality (TH) misses by $0.05, beats on revs; reaffirms FY25 revs guidance
• General News
  • Moody's Ratings downgrades United States ratings to Aa1 from Aaa; changes outlook to stable
  • Atlanta Fed President Raphael Bostic (not a voting FOMC member) CNBC interview: Leaning toward one rate cut this year; Treasury markets are functioning quite well, more concerned with what is happening with Fed mandates
  • Former President Biden diagnosed an aggressive form of prostate cancer
  • House Budget Committee advanced large reconciliation bill that includes tax cuts, spending cuts, energy reform, immigration reform, and a debt ceiling increase. The full House vote is expected late this week, according to Politico
  • Treasury Secretary Scott Bessent in an interview says Moody's downgrade is a "lagging indicator." He said tariff rates could return to April 2 levels for countries that do not negotiate in good faith, according to NBC News
  • President Trump says call with Russian President Putin went "very well"; says "Russia and Ukraine will immediately start negotiations toward a ceasefire and, more importantly, an end to the war"
  • China says chip controls are undermining consensus made on trade, according to Bloomberg
  • Pentagon submits plans for President Trump's "Golden Dome" defense shield; will cost hundreds of billions, according to CNN
  • Stifel warns of 2H25 Big Tech risk, sees opportunity in defensive value amid slowing GDP and fading consumer strength
  • Texas, Florida, and North Carolina will likely keep their AAA bond ratings despite Moody's U.S. downgrade, according to Bloomberg
  • Conservatives secure commitments from House leadership to speed up work requirements in reconciliation bill and repeal green energy tax breaks, according to Politico
  • Senate expected to vote this week on bill that will revoke California's 2035 EV mandate as General Motors (GM) is supportive of the bill, according to the Wall Street Journal
  • China imposed anti-dumping duties on U.S. and Europe, according to Reuters
  • 30-Year mortgage rates top 7%, according to CNBC
  • UK and EU agree to reset relations, according to Financial Times
  • Airbnb (ABNB): Spain Consumer Agency says "The Ministry of Social Rights and Consumer Affairs has sent three resolutions in recent months to the multinational ordering the withdrawal of a total of 65,935 advertisements for tourist housing."
  • Alibaba (BABA): White House concerned that Alibaba's artificial intelligence technology will be available on Apple (AAPL) iPhones, according to the New York Times
  • Alnylam Pharma (ALNY) reports AMVUTTRA (vutrisiran) significantly reduces mortality and a range of important cardiovascular events in patients with ATTR Amyloidosis with Cardiomyopathy: Additional Data from HELIOS-B
  • Binance and Kraken targets of Coinbase-style hacks, but were able to fend off the attacks without losing customer data, according to Bloomberg
  • B. Riley Financial (RILY) CFO to depart to pursue another opportunity; names Scott Yessner as CFO
  • Coca-Cola Consolidated (COKE) announces that its 10-for-1 split of its common stock and Class B common stock has been approved by its stockholders; Shares expected to begin trading on split-adjusted basis at market open on or about May 27, 2025
  • Coinbase Global (COIN): Circle Internet entered talks to sell itself to COIN amid IPO plans, according to Fortune
  • Edison (EIX): Southern California Edison submitted its 2026-2028 Wildfire Mitigation Plan to California’s Office of Energy Infrastructure Safety; Anticipates an investment of $6.2 bln over three years
  • Eli Lilly (LLY): Ozempic copies are surviving, according to the Wall Street Journal
  • Extra Space Storage (EXR) announces planned succession for its EVP and CFO, P. Scoot Stugges, who will retire on December 31, 2025; Board has selected Jeff Normal, current Senior Vice President of Capital Markets and Treasury, to succeed Mr. Stubbs
  • FEMSA (FMX) announces accelerated share repurchase agreement
  • Fluor (FLR) announces that Bayer’s Cell Therapy Launch Facility in Berkeley, California, has been designated the first industrial manufacturing facility in the Western United States to achieve Leadership in Energy and Environmental Design (LEED) v4 Platinum Certification
  • GlaxoSmithKline (GSK) reports Blenrep for 2L+ multiple myeloma approved in Japan
  • H&E Equipment (HEES) announces at its recent quarterly meeting, the Company’s Board of Directors elected not to declare a regular quarterly cash dividend scheduled for payment to stockholders in June 2025
  • Helmerich & Payne (HP) announces that it has engaged Eastdil Secured, a national commercial brokerage firm, to explore future options for Utica Square
  • IES Holdings (IESC) appoints Matthew Simmes to succeed Jeffrey Gendell as Chief Executive Officer
  • Intellia (NTLA) Announces Positive Two-Year Follow-Up Data from Ongoing Phase 1 Study of Nexiguran Ziclumeran (nex-z), in Patients with Hereditary Transthyretin (ATTR) Amyloidosis with Polyneuropathy at Peripheral Nerve Society Annual Meeting
  • Ionis (IONS) announces positive topline results from Essence study of olezarsen in people with moderately elevated triglycerides
  • Janus Henderson Group (JHG) COO James Lowry will step down
  • Johnson & Johnson (JNJ): Association of Medical Device Reprocessors issues statement on $147 mln verdict for AMDR Member Innovative Health Against Johnson & Johnson’s Biosense Webster Medical Technology Unit
  • Mayville Engineering (MEC) announces that one of its manufacturing facilities in Mayville, Wisconsin sustained limited damage from a tornado on May 15
  • Nissan (NSANY) spokesperson says reports of plant closures are speculative, according to Reuters
  • Novavax (NVAX) confirms that the FDA has approved the Biologics License Application for Nuvaxovid for active immunization to prevent COVID-19; Triggers $175 mln milestone payment from Sanofi
  • NVIDIA (NVDA): Foxconn (HNHPF) builds AI Factory in partnership with Taiwan and NVIDIA; provides various company updates
  • Nvidia (NVDA) CEO Jensen Huang doesn't see evidence of artificial intelligence chip diversion to China, according to Bloomberg
  • Paychex's (PAYX) founder Thomas Golisano to Step Down from Company’s Board of Directors, effective after the Board’s July, 2025 meeting
  • PepsiCo (PEP) closes the acquisition of Poppi for $1.95 billion, including $300 million of anticipated cash tax benefits for a net purchase price of $1.65 billion
  • Phillips 66 (PSX) Issues Letter to Shareholders
  • Qorvo (QRVO) announces intent to nominate Peter Feld of Starboard Value for election to the board at the 2025 annual meeting
  • Qualcomm (QCOM) and Advantech collaborate to accelerate Edge AI innovation for IoT
  • Regeneron Pharma (REGN) has been named the successful bidder in the bankruptcy auction for substantially all of the assets of 23andMe Holding Co.
  • Rocket Lab USA (RKLB) launches third mission for iQPS in multi-launch contract
  • RTX (RTX) awarded a $1 bln Missile Defense Agency contract
  • Savara (SVRA) Presented New Data From Pivotal Phase 3 IMPALA-2 Trial of Molgramostim Inhalation Solution (Molgramostim) in Patients With Autoimmune Pulmonary Alveolar Proteinosis (aPAP) at American Thoracic Society Conference (ATS) 2025
  • Signet Jewelers (SIG) estimates that $30-45 mln of restructuring costs
  • Southwest Air (LUV): The Trump administration drops scheduling lawsuit to Southwest, according to Bloomberg
  • Taiwan Semiconductor Manufacturing (TSM) planning to increase prices, according to CTEE
  • Tectonic Therapeutic (TECX) Presents Complete Results for Positive Phase 1b Clinical Trial of TX45 in Patients with Group 2 Pulmonary Hypertension in HFpEF in Late-Breaking Presentation at ESC Heart Failure 2025
  • Tesla (TSLA) wants to prevent shareholder lawsuits, according to
  • Tesla (TSLA): Japan mulling subsidies for Tesla charging stations as part of trade talks, according to Reuters
  • TORM plc (TORM) announces capital increase in connection with exercise of Restricted Share Units as part of TORM's incentive program
  • Uber (UBER): New Jersey Governor Phil Murphy says agreement has been reached with union to end rail strike
  • UnitedHealth's (UNH) Optum aiming to develop Medicare risk scoring system, according to Stat News
  • Walmart (WMT): President Trump says WMT should "eat the tariffs"
  • Wynn Resorts (WYNN) ended plans to acquire NYC casino license, according to Bloomberg
  • Zai Lab (ZLAB) receives U.S. FDA fast track designation for ZL-1310, a DLL3-targeted antibody-drug conjugate, for treatment of extensive-stage small cell lung cancer
  • Zillow (ZG) fully settles $419 mln of convertible notes, co is now debt-free other than credit facility borrowings

• Upgrades:
  • AdvanSix (ASIX) upgraded to Overweight from Neutral at Piper Sandler, tgt $32
  • Archer Daniels Midland (ADM) upgraded to Buy from Neutral at UBS, tgt $60
  • Charter (CHTR) upgraded to Buy from Hold at Loop Capital, tgt $510
  • Charter (CHTR) upgraded to Market Perform from Underperform at Raymond James
  • CI&T (CINT) upgraded to Overweight from Neutral at JPMorgan, tgt $7
  • Cognizant Technology Solutions (CTSH) upgraded to Overweight from Neutral at JPMorgan, tgt $98
  • Delta Air Lines (DAL) upgraded to Buy from Neutral at UBS, tgt $66
  • Grupo Aeroportuario (OMAB) upgraded to Neutral from Underperform at BofA Securities Securities
  • Marqeta (MQ) upgraded to Overweight from Neutral at JPMorgan, tgt $6
  • Methanex (MEOH) upgraded to Overweight from Neutral at Piper Sandler, tgt $48
  • MoonLake Immunotherapeutics (MLTX) upgraded to Outperform from Peer Perform at Wolfe Research, tgt $61
  • RxSight (RXST) upgraded to Overweight from Equal Weight at Wells Fargo, tgt $25
  • Solventum (SOLV) upgraded to Overweight from Neutral at Piper Sandler, tgt $87
  • United Airlines (UAL) upgraded to Buy from Neutral at UBS, tgt $105
  • Williams-Sonoma (WSM) upgraded to Equal Weight from Underweight at Barclays, tgt $166
  • YPF S.A. (YPF) upgraded to Buy from Neutral at Citigroup, tgt $48
• Downgrades:
  • Biohaven (BHVN) downgraded to Sector Perform from Outperform at RBC Capital, tgt $21
  • BP (BP) downgraded to Hold from Buy at Jefferies, tgt $29
  • BRF SA (BRFS) downgraded to Equal Weight from Overweight at Barclays, tgt $3.50
  • Endava PLC (ADR) (DAVA) downgraded to Neutral from Overweight at JPMorgan, tgt $18
  • GE Aerospace (GE) downgraded to Neutral from Buy at Northcoast
  • Helmerich & Payne (HP) downgraded to Neutral from Buy at Citigroup, tgt $19
  • Jack In The Box (JACK) downgraded to Sell from Neutral at Northcoast, tgt $20
  • Liquidia Technologies (LQDA) downgraded to Underperform from Perform at Oppenheimer, tgt $13
  • Nabors (NBR) downgraded to Underweight from Equal Weight at Barclays, tgt $28
  • Netflix (NFLX) downgraded to Neutral from Overweight at JPMorgan, tgt $1,220
  • Patterson-UTI Energy (PTEN) downgraded to Neutral from Buy at Citigroup, tgt $6.50
  • Reddit (RDDT) downgraded to Equal Weight from Overweight at Wells Fargo, tgt $115
  • Shake Shack (SHAK) downgraded to Hold from Buy at TD Cowen, tgt $105
  • UnitedHealth (UNH) downgraded to Hold from Buy at TD Cowen, tgt $308
• Others:
  • American Tower (AMT) reinstated with a Buy at BofA Securities Securities, tgt $255
  • Clearwater Analytics Holdings (CWAN) reinstated with a Neutral at Goldman, tgt $26
  • Crown Castle (CCI) reinstated with a Buy at BofA Securities, tgt $115
  • Curis (CRIS) assumed with a Buy at H.C. Wainwright, tgt $17
  • Digital Realty Trust (DLR) reinstated with a Buy at BofA Securities, tgt $210
  • Equinix (EQIX) reinstated with a Buy at BofA Securities, tgt $1,000
  • Matador Resources (MTDR) initiated with a Buy at BofA Securities, tgt $56
  • Mirum Pharmaceuticals (MIRM) assumed with a Buy at H.C. Wainwright, tgt $73
  • SBA Communications (SBAC) reinstated with a Buy at BofA Securities, tgt $260

• Econ Data (Tuesday):
  • There is no U.S. economic data of note
• Earnings:
  • Monday (May 19)
    • Pre-Market: TH
    • After-Hours: AEGHT AGYS TRNS TCOM
  • Tuesday (May 20)
    • Pre-Market: AS BILI EXP GDS HD HOV VIK VIPS
    • After-Hours: JHX KEYS MOD PANW SKY TOL VSAT ZTO
  • Wednesday (May 21)
    • Pre-Market: BIDU GOOS DY LOW MDT TGT TJX VFC WB WIX
      
    • After-Hours: DOMO ENS RAMP SNOW URBN ZM
  • Thursday (May 22)
    • Pre-Market: AAP ADI BJ LSPD RL TD
    • After-Hours: ADSK CPRT DECK INTU LGF.A ROST STEP WDAY
  • Friday (May 23)
    • Pre-Market: BAH BKE
    • After-Hours: None
  General Motors: 5,000 members at GM's Arlington, TX assembly plant join UAW strike