After Hours Report

The S&P 500 advanced 0.5% on Thursday in a volatile session that saw the benchmark index fall as much as 3.3% in early action and gain as much as 2.9% in the afternoon. The Dow Jones Industrial Average rose 1.0%, while the Nasdaq Composite (+2.3%) and Russell 2000 (+6.8%) were the big movers today amid strong gains in technology and small-cap stocks.

The news cycle wasn't entirely positive with the number of COVID-19 cases continuing to surge globally, leading more companies to withdraw guidance, suspend dividends, and temporarily lay off workers. The latter started to be quantified in the weekly initial claims, which increased by 70,000 to 281,000 (Briefing.com consensus 220,000) for the week ending March 14.

To mitigate the negative impact of the coronavirus, central banks continued to amplify stimulus efforts, Congress continued to deliberate the proposed $1.3 trillion fiscal stimulus package, and clinical trials for new therapies remained in progress, according to President Trump. 

The latest central bank moves included the Fed establishing a Money Market Mutual Fund Liquidity Facility (MMLF), the ECB and Bank of Japan announcing emergency bond-buying programs, and the Bank of England issuing a surprise rate cut and raising its asset purchases. Although not market-moving, there was an appreciation for the urgency to ease the intense strains on financial markets.

Investors also welcomed the respite from the recent days of heavy selling, but the S&P 500 remained down 11.1% for the week and not all sectors participated in today's advance. The S&P 500 consumer discretionary (+3.4%) and energy (+6.8%) sectors presumably outperformed amid tactical trading opportunities and, specifically for the energy space, the 23% spike in WTI crude ($20.42/bbl, +4.71, +23.1%). 

Oil prices were aided by comments from President Trump, who said that he will get involved in the price war between Russia and Saudi Arabia at "the appropriate time." An afternoon report from The Wall Street Journal noted that Texas is considering cutting oil production. Today's move in oil follows a 24% price drop yesterday. 

Left out of today's advance were the defensive-oriented S&P 500 utilities (-5.5%), consumer staples (-2.9%), health care (-1.9%), and real estate (-1.4%) sectors. 

U.S. Treasuries finished sharply higher after two days of aggressive selling, driving yields lower across the curve. The 2-yr yield declined 14 basis points to 0.38%, and the 10-yr yield declined 15 basis points to 1.12%. The U.S. Dollar Index advanced 1.5% to 102.67, as demand remained strong for the world's reserve currency. 

Reviewing Thursday's economic data:

• Initial claims for the week ending March 14 increased by 70,000 to 281,000 (Briefing.com consensus 220,000), bolstered by the impact of the coronavirus. The unadjusted number of initial claims increased by 50,517 to 250,892. Continuing claims for the week ending March 7 increased by 2,000 to 1.701 million.
  • The key takeaway from the report is that it is an early warning sign of much larger claims numbers to come considering the fact that many forced, or voluntary, business closures didn't start to ramp up until the middle of the month with initial expectations that they will be closed at least through the end of March.
• The Philadelphia Fed Index for March dropped to -12.7 (Briefing.com consensus 10.0) from the 36.7 reading in February.
• The current account deficit for the fourth quarter totaled $109.8 billion. The third quarter deficit was revised to $125.4 billion from $124.1 billion.

Looking ahead, investors will receive Existing Home Sales for February on Friday.

• Nasdaq Composite: -20.3%
• S&P 500: -25.4%
• Dow Jones Industrial Average: -29.6%
• Russell 2000: -36.6%

Overseas: 

• Europe: DAX +2.0%, FTSE +1.4%, CAC +2.7%
• Asia: Nikkei -1.0%, Hang Seng -2.6%, Shanghai -1.0%

Commodities: 

• Crude Oil +4.91 @ 25.28
• Nat Gas +0.05 @ 1.65
• Gold +3.70 @ 1481.60
• Silver +0.37 @ 12.15
• Copper +0.03 @ 2.18

• Altria (MO) announces temporary suspension of operations at Richmond manufacturing center after second employee tests positive for COVID-19... MO down 0.5% after hours
• Cintas (CTAS) beats by $0.13, reports revs in-line; withdraws full year guidance due to coronavirus... no indications for CTAS after hours
• CrowdStrike (CRWD) beats by $0.06, beats on revs; guides Q1 EPS above consensus, revs above consensus; guides FY21 EPS above consensus, revs above consensus... CRWD up 18.1% after hours
• Dine Brands (DIN) withdraws FY20 guidance; draws on existing variable funding senior notes... DIN down 2.0% after hours
• Herbalife Nutrition (HLF) reprices term loan facility, extends maturity date of revolving credit to March 2025, and reduces borrowing costs... HLF down 4.1% after hours
• Kohl's (KSS) withdraws guidance and temporarily suspends share repurchases; confirms temporary closure of stores nationwide, effective March 19 through at least April 1... KSS down 3.4% after hours
• Ollie’s Bargain Outlet (OLLI) misses by $0.02, misses on revs, comps -4.9%; does not provide FY20 guidance... OLLI down 2.8% after hours
• Scholastic Corp (SCHL) beats by $0.30, beats on revs, says it cannot affirm its current guidance ranges for FY20... SCHL up 4.0% after hours
• Tesla (TSLA) temporarily suspends production at Fremont and NY facilities; says it believes it has liquidity sufficient to successfully navigate an extended period of uncertainty... TSLA down 7.3% after hours

Fair Value for Friday, March 20:

• S&P 500: 2396
• Nasdaq 100: 7271
• DJIA: 19937

Today's News Summary:

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

• Earnings/Guidance (Full Earnings Calendar):
  • 1Life Healthcare (ONEM) reports Q4 results with upside sales but sees Q1 sales below consensus
  • Accenture (ACN) beats by $0.18, reports revs in-line; guides Q3 revs below consensus; lowers FY20 guidance
  • Burlington Stores (BURL) is withdrawing the first quarter and full year 2020 guidance
  • Caleres (CAL) withdraws 2020 financial guidance; Closes remaining Famous Footwear stores
  • Capstead Mortgage (CMO) provides financial update; book value per common share has decreased an estimated 10% to 12% since year-end
  • Casper Sleep (CSPR) reports Q4 results
  • China Mobile (CHL) reports FY19 results
  • Citi Trends (CTRN) is withdrawing its first-quarter and fiscal year 2020 financial guidance
  • Cohu (COHU) withdraws Q1 guidance
  • Commercial Metals (CMC) beats by $0.04, misses on revs
  • Cracker Barrel (CBRL) announces it is withdrawing its previously issued fiscal 2020 outlook, including fiscal 2020 earnings guidance, due to the uncertain impact of the coronavirus (COVID-19) pandemic
  • Darden Restaurants (DRI) beats by $0.01, reports revs in-line; suspends quarterly dividend; withdraws FY20 guidance
  • Diamondrock Hospitality (DRH) withdraws 2020 guidance; suspends common dividend
  • DouYu (DOYU) misses by $CNY0.23, beats on revs; guides Q1 revs above consensus
  • Dril-Quip (DRQ) withdraws Q1 guidance in response to COVID-19
  • Estee Lauder (EL) withdraws FY20 guidance as a result of COVID-19
  • Exact Sciences (EXAS) withdraws prior first-quarter and annual guidance for 2020 due to COVID-19 impact
  • Five Below (FIVE) beats by $0.03, reports revs in-line, comps -2.2%
  • G-III Apparel (GIII) beats by $0.08, misses on revs
  • General Electric (GE) adding manufacturing lines to ventilator production and increasing the number of shifts to produce around the clock
  • Guess? (GES) beats by $0.10, misses on revs, decides not to provide guidance, postpones Q1 dividend
  • Herman Miller (MLHR) beats by $0.04, misses on revs
  • Lennar (LEN) beats by $0.43, beats on revs
  • Manpower (MAN) withdraws Q1 guidance
  • Marriott (MAR) withdraws all aspects of its 2020 outlook; provides business update
  • Momo (MOMO) beats by $0.39, beats on revs; guides Q1 revs below two analyst estimate; declares special dividend
  • National Vision (EYE) says it will temporarily close all retail locations through March 28
  • Nucor (NUE) sees Q1 EPS above consensus
  • PagerDuty (PD) beats by $0.03, beats on revs; guides Q1 EPS in-line, revs above consensus; guides FY21 EPS below consensus, revs in-line
  • PolyOne (POL) reaffirms Q1 guidance
  • QAD (QADA) reports Q4 results, reports revs in-line
  • Rattler Midstream (RTLR) sees FY20 EBITDA of $260-300 mln
  • Steel Dynamics (STLD) guides Q1 EPS well ahead of consensus; order backlogs are strong and customer order activity has remained steady; however co expects coronavirus to impact order activity in the coming weeks
  • Steven Madden (SHOO) withdraws FY20 revenue and earnings guidance as a result of COVID-19
  • Tailored Brands (TLRD) beats by $0.08, misses on revs, refrains from providing guidance for FY20
  • TripAdvisor (TRIP) withdraws 2020 guidance due to increased impacts of the COVID-19 outbreak and the uncertainty it has created on global travel trends
  • Trip.com Group (TCOM) beats by $0.16, beats on revs; guides Q1 revs below consensus
  • Vail Resorts (MTN) provides commentary on COVID-19; anticipates a negative impact of $180-$200 mln compared to Resort Reported EBITDA expectations as of March 1
  • Viper Energy Partners (VNOM) lowers production guidance
  • Williams-Sonoma (WSM) beats by $0.07, beats on revs; Comparable brand revenue growth accelerates to +7.6%
  • Zumiez (ZUMZ) withdraws Q1 and FY20 guidance; to temporarily close stores in US and Canada in connection with COVID-19 outbreak
• General News:
  • Federal Reserve Board broadens program of support for the flow of credit to households and businesses by establishing a Money Market Mutual Fund Liquidity Facility
  • ECB announces EUR 750 bln pandemic emergency purchase program
  • Bank of England reduces rates 15 basis points to 0.10% and boosts size of asset purchase program to GBP645 bln from GBP445 bln
  • Treasury Secretary Steven Mnuchin Fox Business interview: Payments to Americans will be $1000 per person and $500 additional for every child the taxpayer has; payments to made again six weeks later if there is still a national emergency
  • Larry Kudlow says the Trump administration may consider asking for an equity stake in companies that want coronavirus support, according to Bloomberg
  • President Trump says he supports allowing government to take equity stakes in companies that accept bailout money
  • The Department of State confirms advisory that US citizens to avoid all international travel due to the global impact of COVID-19
  • White House issues executive order on prioritizing and allocating health and medical resources to respond to the spread of Covid-19
  • Italy COVID-19 deaths have topped deaths in China, according to CNBC
  • New York Governor Andrew Cuomo orders 75% of non essential workforce to stay home & approved mortgage relief, according to CNBC
  • Nearly 40% of patients sick enough to be hospitalized for the coronavirus were aged 20 to 54, according to the New York Times
  • U.S. may attempt to intervene in Saudi/Russia oil production talks; may seek further sanctions on Russia, according to The Wall Street Journal
  • Texas considering cutting oil production, according to The Wall Street Journal
  • Hotels may turn into hospitals in New York City, according to the Wall Street Journal
  • Two members of Congress test positive for coronavirus, according to BuzzFeed News
  • President Trump signs bill to provide extended unemployment, sick leave benefits, and free coronavirus testing
  • Brazil central bank lowers rates 50 basis points to 3.75%
  • Abbott Labs (ABT) announces that the FDA has issued Emergency Use Authorization (EUA) for the co's molecular test for novel coronavirus
  • Amazon (AMZN) employee in Queens, New York contracted coronavirus. The company temporarily closed the warehouse where this employee works, according to Bloomberg
  • Blackstone (BX): Bill Ackman is buying shares of Blackstone, according to Bloomberg
  • Boeing (BA) is eyeing dividend cut, layoffs to conserve cash, according to The Wall Street Journal
  • Carnival (CCL) extends offer to gov'ts, health authorities to use ships as temporary hospitals
  • Credit Suisse (CS) says profitability in 1Q 2020 has so far continued the strong year-on-year improvement trend notwithstanding the COVID-19 pandemic
  • Expedia Group (EXPE) borrowed $1.9 bln under its $2 bln credit agreement as a precautionary measure to provide increased liquidity and preserve financial flexibility in light COVID-19 uncertainties
  • Fiat Chrysler (FCAU) will cease production at its plants across North America, starting progressively from today through the end of March
  • Ford Motor (F) notified lenders that it will borrow the total unused amounts against two lines of credit: $13.4 bln under its corporate credit facility and $2 bln under its supplemental credit facility; withdraws guidance; and suspends dividend
  • General Motors (GM) evaluates using auto factories to make ventilators and other medical equipment, according to CNBC
  • Harley-Davidson (HOG) temporarily suspends U.S. production
  • HSBC (HSBC) could be forced to delay restructuring amid coronavirus outbreak, according to Financial Times
  • Intel (INTC) states that it is maintaining a rate of on-time delivery currently above 90% for its products through the COVID-19 pandemic
  • IntercontinentalExchange (ICE) to move temporarily to fully electronic trading, effective March 23
  • Kohl's (KSS) to temporarily close its stores nationwide, effective today, as a result of COVID-19 escalation
  • Tesla (TSLA) CEO Elon Musk aims to make ventilators for coronavirus sufferers, according to Reuters
  • TJX (TJX) withdraws Q1 and FY21 guidance; suspends share repurchases; to close all stores in the US, Canada, Europe, and Australia for two weeks; to close online businesses
  • Toyota Motor (TM) is temporarily suspending production at all of its automobile and components plants in North America

• Upgrades:
  • Aphria (APHA) upgraded to Buy from Neutral at BofA/Merrill
  • Avnet (AVT) upgraded to Equal Weight from Underweight at Wells Fargo; tgt lowered to $22
  • Barrat Developments (BTDPF) upgraded to Buy from Hold at Jefferies
  • Baxter (BAX) upgraded to Buy from Hold at Stifel; tgt raised to $95
  • Bright Horizons (BFAM) upgraded to Outperform from Neutral at Robert W. Baird; tgt $95
  • Corteva (CTVA) upgraded to Buy from Hold at Edward Jones
  • Domino's Pizza (DPZ) upgraded to Hold from Sell at Deutsche Bank
  • Emerald Expositions Events (EEX) upgraded to Equal Weight from Underweight at Barclays; tgt $4
  • Fastenal (FAST) upgraded to Overweight from Equal Weight at Wells Fargo; tgt $45
  • Flutter Entertainment (PDYPY) upgraded to Neutral from Sell at Citigroup
  • Givaudan SA (GVDNY) upgraded to Buy from Sell at Redburn
  • Green Dot (GDOT) upgraded to Outperform from Market Perform at Northland Capital; tgt $35
  • Host Hotels (HST) upgraded to Neutral from Underperform at BofA/Merrill
  • Kirkland Lake Gold (KL) upgraded to Sector Outperform from Neutral at CIBC
  • MPLX LP (MPLX) upgraded to Buy from Neutral at BofA/Merrill; tgt $20
  • Newtek (NEWT) upgraded to Buy from Neutral at Ladenburg Thalmann; tgt $13
  • NIC Inc (EGOV) upgraded to Buy from Neutral at DA Davidson
  • NIC Inc (EGOV) upgraded to Strong Buy from Mkt Perform at Raymond James; tgt $26
  • PNC (PNC) upgraded to Overweight from Equal Weight at Wells Fargo; tgt $110
  • Prestige Consumer (PBH) upgraded to Buy from Neutral at DA Davidson
  • Roku (ROKU) upgraded to Hold from Sell at Loop Capital; tgt $68
  • SBA Comm (SBAC) upgraded to Outperform from Mkt Perform at Raymond James; tgt $276
  • Siemens AG (SIEGY) upgraded to Outperform from Sector Perform at RBC Capital Mkts
  • Square (SQ) upgraded to Neutral from Sell at BTIG Research
  • STMicroelectronics (STM) upgraded to Buy from Neutral at Citigroup
  • Symrise (SYIEY) upgraded to Buy from Neutral at Redburn
  • Tesla (TSLA) upgraded to Equal-Weight from Underweight at Morgan Stanley; tgt lowered to $460
  • Thomson Reuters (TRI) upgraded to Outperform from Sector Perform at National Bank Financial
  • TreeHouse Foods (THS) upgraded to Buy from Neutral at BofA/Merrill; tgt lowered to $46
• Downgrades:
  • Beyond Meat (BYND) downgraded to Underperform from Neutral at BofA/Merrill
  • Clorox (CLX) downgraded to Neutral from Outperform at Credit Suisse; tgt raised to $172
  • Coca-Cola European Partners (CCEP) downgraded to Underperform from Buy at BofA/Merrill; tgt lowered to $30
  • Estee Lauder (EL) downgraded to Underweight from Overweight at JP Morgan; tgt $145
  • Etsy (ETSY) downgraded to Neutral from Buy at ROTH Capital; tgt lowered to $41
  • Lamb Weston (LW) downgraded to Neutral from Buy at BofA/Merrill
  • Manpower (MAN) downgraded to Underweight from Overweight at Barclays; tgt $68
  • McCormick (MKC) downgraded to Underperform from Neutral at BofA/Merrill; tgt lowered to $140
  • Nabriva Therapeutics (NBRV) downgraded to Neutral from Outperform at Wedbush
  • Revolve Group (RVLV) downgraded to Hold from Buy at Jefferies; tgt $9
  • Univar Solutions (UNVR) downgraded to Equal Weight from Overweight at Wells Fargo; tgt $10
  • Vir Biotechnology (VIR) downgraded to Underweight from Neutral at JP Morgan; tgt $26
  • Westlake Chemical (WLK) downgraded to Mkt Perform from Outperform at Bernstein; tgt lowered to $30
  • ZTO Express (ZTO) downgraded to Hold from Buy at CMB International
• Others:
  • Amcor (AMCR) initiated with a Buy at Deutsche Bank; tgt $7.50
  • Callon Petroleum (CPE) resumed with a Neutral at Credit Suisse; tgt $1
  • Celanese (CE) initiated with a Sector Outperform at Scotiabank; tgt $117
  • Centennial Resource Development (CDEV) resumed with a Neutral at Credit Suisse; tgt $1
  • Cimarex (XEC) resumed with an Outperform at Credit Suisse; tgt $28
  • Continental Resources (CLR) resumed with a Neutral at Credit Suisse; tgt $12
  • CyberArk (CYBR) initiated with a Neutral at Robert W. Baird; tgt $85
  • Diamondback Energy (FANG) resumed with an Outperform at Credit Suisse; tgt $52
  • Dow (DOW) initiated with a Sector Perform at Scotiabank; tgt $37
  • Eastman Chemical (EMN) initiated with a Sector Outperform at Scotiabank; tgt $73
  • EQT Corp. (EQT) resumed with a Neutral at Credit Suisse; tgt $8
  • Huntsman (HUN) initiated with a Sector Perform at Scotiabank; tgt $22
  • LyondellBasell (LYB) initiated with a Sector Outperform at Scotiabank; tgt $78
  • Magnolia Oil & Gas (MGY) resumed with a Neutral at Credit Suisse; tgt $7
  • Methanex (MEOH) initiated with a Sector Perform at Scotiabank; tgt $24
  • Parsley Energy (PE) resumed with an Outperform at Credit Suisse; tgt $13
  • PDC Energy (PDCE) resumed with an Outperform at Credit Suisse; tgt $15
  • QEP Resources (QEP) resumed with a Neutral at Credit Suisse; tgt $1
  • SM Energy (SM) resumed with a Neutral at Credit Suisse; tgt $2.50
  • Terex (TEX) removed from Conviction Buy List at Goldman
  • Voyager Therapeutics (VYGR) initiated with a Buy at The Benchmark Company; tgt $18
  • Westlake Chemical (WLK) initiated with a Sector Perform at Scotiabank; tgt $48
  • WPX Energy (WPX) resumed with an Outperform at Credit Suisse; tgt $8

Upcoming Events:

• Econ Data (Friday):
  • 10:00 ET: February Existing Home Sales (Briefing.com consensus 5.50 mln; prior 5.46 mln)
• Earnings:
  • Monday (March 16)
    • Pre-Market: NBEV
    • After-Hours: APYX BE CPRX COUP HQY HUYA YY RPAY TME TERP ZTO
  • Tuesday (March 17)
    • Pre-Market:  DBI HDS LE MIK
    • After-Hours: ADUS BILI FDX MDB SMAR WPRT
  • Wednesday (March 18)
    • Pre-Market:  BZUN FUTU GIS IAA NIO QTT
    • After-Hours:  FIVE GES MLHR PD QADA TLRD TCOM VFF WSM
  • Thursday (March 19)
    • Pre-Market:  ACN CMC DRI DOYU DLTH EPAC GDS LEN MOM PLCE
    • After-Hours: CTAS CRWD OLLI SCHL
  • Friday (March 20)
    • Pre-Market: HIBB
    • After-Hours: None of note
    • Full Earnings Calendar