After Hours Report

The S&P 500 (+0.5%) set a new intraday high on Wednesday, as investors were relieved to hear that the situation with Iran may not escalate militarily beyond the actions taken by Iran last night. The Nasdaq Composite (+0.7%) closed at a record high, the Dow Jones Industrial Average gained 0.6%, and the Russell 2000 gained 0.3%. Stocks did fade into the close, though.

Iran fired more than a dozen ballistic missiles against U.S. and coalition forces in Iraq, which immediately sent equity futures down more than 1.5%. The reaction was short-lived upon details that it resulted in no American casualties and after Iran's foreign minister said Iran is not seeking escalation or war.

As stocks wavered with modest gains after the open, President Trump told the nation in a press conference that he will be imposing additional sanctions on Iran, implying that economic countermeasures will be favored over military ones. A mostly broad-based rally ensued, with nine of the 11 S&P 500 sectors finishing with gains.

The information technology (+1.0%) and communication services (+0.7%) sectors outperformed, while the energy sector (-1.7%) fell behind amid a retreat in oil prices ($59.62, -3.06, -4.9%). WTI crude futures dropped below $60/bbl following bearish inventory data and receding concerns about production disruptions.

Stock laggards included Boeing (BA 331.37, -5.91, -1.8%) after a 737-800 jetliner crashed shortly after takeoff in Tehran, killing all 176 passengers on board, and Walgreens Boots Alliance (WBA 55.83, -3.46, -5.8%) after it missed earnings estimates. 

Positive corporate news came out of Macy's (M 18.10, +0.43, +2.4%), which reported better than feared holiday sales, and Constellation Brands (STZ 190.29, +6.69, +3.6%), which beat top and bottom-line estimates.

Shares of GrubHub (GRUB 54.75, +6.12, +12.6%) climbed nearly 13% after The Wall Street Journal reported the company is pursuing strategic options, including a possible sale. 

U.S. Treasuries declined alongside the advance in equities, driving yields higher across the curve. The 2-yr yield rose four basis points to 1.58%, and the 10-yr yield rose five basis points to 1.87%. The U.S. Dollar Index increased 0.3% to 97.30. Gold futures fell 0.9% to $1560.50/ozt. 

Reviewing Wednesday's economic data, which included the ADP Employment Change Report for December and the Consumer Credit report for November:

• The ADP Employment Change Report showed an estimated 202,000 positions were added to private sector payrolls in December (Briefing.com consensus 155,000) on top of an upwardly revised 124,000 (from 67,000) in November.
• Consumer credit increased by $12.5 bln in November (Briefing.com consensus $17.5 bln) after increasing by $18.9 bln in October.
  • The key takeaway from the report is that the November increase was driven entirely by nonrevolving credit.

Looking ahead, investors will receive the weekly Initial and Continuing Claims report on Thursday.

• Nasdaq Composite +1.8% YTD
• S&P 500 +0.7% YTD
• Dow Jones Industrial Average +0.7% YTD
• Russell 2000 -0.3% YTD

Overseas: 

• Europe: DAX +0.7%, FTSE unch, CAC +0.3%
• Asia: Nikkei  -1.6%, Hang Seng -0.8%, Shanghai -1.2%

Commodities: 

• Crude Oil -3.41 @ 59.29
• Nat Gas -0.03 @ 2.14
• Gold -13.30 @ 1560.60
• Silver -0.21 @ 18.18
• Copper +0.02 @ 2.81

• Bed Bath & Beyond (BBBY) misses by $0.41, misses on revs; comps -8.3%; withdraws full year guidance but maintains dividend; plans to reveal new strategic vision in early 2020... BBBY down 9.4% after hours
• Chico's FAS (CHS) raises Q4 outlook and announces that its CFO has resigned... CHS up 26.3% after hours
• Costco (COST) reports total company comparable sales growth of 9.0% for five weeks ended January 5, 2020... COST up 0.6% after hours
• DBV Technologies (DBVT) reports "positive" top-line results for three-year, open-label extension of Phase III PEPITES trial... DBVT up 19.7% after hours
• Globus Medical (GMED) guides Q4 revenue slightly above the consensus expectation; issues FY20 guidance below consensus expectation... no after hours indication for GMED
• Helen of Troy (HELE) beats by $0.63, beats on revs; raises FY20 EPS above consensus, revs above consensus... HELE up 6.5% after hours
• Merck (MRK) announces FDA approval of KEYTRUDA for certain patients with BCG-unresponsive, high-risk NMIBC... MRK up 0.1% after hours
• News Corp. (NWSA) names David Doctorow as CEO for its Move, Inc. segment, effective Feb 3; Doctorow joins Move from eBay where he served as Head of Global Growth, eBay Marketplaces... NWSA up 0.3% after hours
• Tufin Software (TUFN) sees Q4 revenue of $29.5-$30.1 mln vs. prior guidance of $34-$38 mln, Expects Non-GAAP operating loss of ($2.6)-($1.1) mln compared to prior expectation of Non-GAAP operating profit of $0.0-$3.0 mln.... TUFN down 30.8% after hours

Fair Value for Thursday, January 9:

• S&P 500: 3253
• Nasdaq 100: 8927
• DJIA: 28705

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):
  • A10 Networks (ATEN) issues upside Q4 revenue guidance
  • ChipMOS TECHNOLOGIES (IMOS) reports Q4 revenues of +12% yr/yr to NT 5.57 bln vs NT 5.48 bln Capital IQ consensus
  • Collegium Pharmaceutical (COLL) guides for FY20
  • Constellation Brands (STZ) beats by $0.30; revs slightly above expectations; raises FY20 guidance
  • GOL Linhas Aereas Inteligentes S.A. (GOL) reports prelim Q4 results
  • Greenbrier (GBX) misses by $0.13, beats on revs; reaffirms FY20 EPS guidance, revs guidance
  • Livent (LTHM) lowers Q4 EPS and revenue guidance
  • Lennar (LEN) beats by $0.24, beats on revs; guides Q1 EPS just below estimates on the call
  • Macy's (M) reports November comp of -0.7% and Decmeber comp of -0.6%
  • MSC Industrial (MSM) beats by $0.04, reports revs in-line; guides Q2 EPS below consensus, revs below consensus
  • RPM Inc (RPM) beats by $0.03, reports revs in-line; guides Q3 EPS below consensus, revs in-line; reaffirms FY20 EPS guidance, revs guidance
  • Samsung (SSNLF) sees Q4 sales of KRW 59 trillion vs KRW 59 trillion in Q4 of last year; sees Q4 operating profit of KRW 7.1 trillion vs KRW 10.8 trillion in Q4 of last year
  • Schnitzer Steel (SCHN) misses by $0.01, reports revs in-line with single est
  • SeaSpine (SPNE) guides Q4 and 2020 revs above consensus
  • UniFirst (UNF) beats by $0.50, beats on revs; raises bottom end of FY20 EPS guidance, but lowers top end of FY20 revenue guidance
  • United Airlines (UAL) to record special non-cash impairment charge of $90 mln for Q4
  • Walgreens Boots Alliance (WBA) misses by $0.04, reports revs in-line; reaffirms FY20 guidance
• General News:
  • Iran launched more than a dozen ballistic missiles against US military and coalition forces in Iraq, no reports of American or Iraqi casualties.
  • President Trump said Iran will never be allowed to have a nuclear weapon and that it appears that Iran is standing down; announces new economic sanctions following missile attack
  • Ukrainian Boeing (BA) 737-800 plane crashes after takeoff from Iran; Iran says it was mechanical issues, but Ukraine is still investigating
  • Senate Majority Leader Mitch McConnell (R-KY) has enough votes to proceed with impeachment trial without agreement on witnesses, but House Speaker Nancy Pelosi (D-CA) will not send impeachment articles to Senate until she learn more, according to the Washington Post
  • CNN reporter Manu Raju tweeting House Speaker Nancy Pelosi (D-CA) says House will vote on resolution to limit President Trump's powers on Iran tomorrow
  • New York Governor Andrew Cuomo promised to legalize marijuana this year, according to NY Times
  • US increasing pressure on UK ahead of decision regarding use of Huawei equipment in upgraded networks, according to Reuters
  • Applied Therapeutics (APLT) announces 'positive' topline results from the Pivotal Phase 2 portion of the ACTION-Galactosemia study of AT-007 in adult Galactosemia patients
  • Campbell Soup (CPB) announces that President of its snacks division will leave the company
  • Cott (COT) announces evaluation of strategic alternatives to its coffee, tea and extract solutions segment to enhance shareholder value
  • GrubHub (GRUB) is pursuing strategic options, including a sale, according to The Wall Street Journal
  • Macy's (M) to close 28 stores and one Bloomingdale's store, according to CNBC
  • Sonos (SONO) discloses filing of patent lawsuit against Alphabet's (GOOG) Google
  • Tenneco (TEN) announces steps to streamline its leadership strucuture; Co-CEO Brian Kesseler will assume newly consolidated role of CEO of Tenneco; Roger Wood will no longer serve as Co-CEO; Jason Hollar remains as CFO
  • ViacomCBS (VIAC) and Comcast (CMCSA) renew content carriage agreement

• Upgrades:
  • Allete (ALE) upgraded to Buy from Neutral at Guggenheim
  • Apache (APA) upgraded to Buy from Hold at Stifel; tgt raised to $39
  • Ares Commercial Real Estate (ACRE) upgraded to Outperform from Neutral at Credit Suisse; tgt raised to $16
  • Brighthouse Financial (BHF) upgraded to Neutral from Sell at Goldman; tgt raised to $41
  • Ciena (CIEN) upgraded to Overweight from Equal-Weight at Morgan Stanley; tgt raised to $50
  • Commscope (COMM) upgraded to Buy from Neutral at BofA/Merrill
  • Hecla Mining (HL) upgraded to Neutral from Sector Underperform at CIBC
  • Occidental Petro (OXY) upgraded to Buy from Neutral at Mizuho; tgt raised to $58
• Downgrades:
  • Allegheny Tech (ATI) downgraded to Equal Weight from Overweight at Barclays; tgt $22
  • American Electric (AEP) downgraded to Sell from Neutral at Guggenheim
  • Avista (AVA) downgraded to Sell from Neutral at Guggenheim
  • Becton Dickinson (BDX) downgraded to Equal Weight from Overweight at Barclays; tgt $275
  • Blackstone Mortgage Trust (BXMT) downgraded to Neutral from Outperform at Credit Suisse; tgt $37.50
  • Boeing (BA) downgraded to Market Perform from Outperform at Cowen; tgt lowered to $371
  • Cincinnati Fincl (CINF) downgraded to Underweight from Neutral at Piper Sandler; tgt $110
  • Cisco (CSCO) downgraded to Neutral from Buy at BofA/Merrill
  • Con Edison (ED) downgraded to Sell from Neutral at Guggenheim
  • Corning (GLW) downgraded to Equal-Weight from Overweight at Morgan Stanley; tgt lowered to $33
  • FGL Holdings (FG) downgraded to Sell from Neutral at Goldman; tgt raised to $9
  • FireEye (FEYE) downgraded to Neutral from Buy at BofA/Merrill
  • ForeScout Technologies (FSCT) downgraded to Neutral from Buy at UBS; tgt raised to $36
  • Kohl's (KSS) downgraded to Market Perform from Outperform at Cowen; tgt lowered to $53
  • Palo Alto Networks (PANW) downgraded to Neutral from Buy at BofA/Merrill
  • Restaurant Brands Int'l (QSR) downgraded to Underperform from Neutral at BofA/Merrill
  • Southwest Air (LUV) downgraded to Neutral from Buy at BofA/Merrill
  • V.F. Corp (VFC) downgraded to Neutral from Outperform at Wedbush
  • Wynn Resorts (WYNN) downgraded to Neutral from Buy at Citigroup; tgt $140
  • Yum! Brands (YUM) downgraded to Market Perform from Outperform at Cowen; tgt lowered to $109
• Others:
  • Agilent (A) initiated with an Overweight at Wells Fargo; tgt $100
  • Ameren (AEE) initiated with a Buy at Guggenheim; tgt $82
  • Avantor (AVTR) initiated with an Overweight at Wells Fargo; tgt $22
  • AXA Equitable (EQH) added to Conviction Buy List at Goldman
  • Axonics Modulation (AXNX) initiated with a Buy at SunTrust; tgt $38
  • BioLife Solutions (BLFS) initiated with an Overweight at Stephens; tgt $23
  • BioTelemetry (BEAT) initiated with a Buy at SunTrust; tgt $58
  • Bio-Rad Labs (BIO) initiated with an Overweight at Wells Fargo; tgt $430
  • Bruker (BRKR) initiated with an Overweight at Wells Fargo; tgt $60
  • Charles River (CRL) initiated with an Overweight at Wells Fargo; tgt $180
  • Chesapeake Utilities (CPK) initiated with a Neutral at Guggenheim; tgt $92
  • Cryoport (CYRX) initiated with an Overweight at Stephens; tgt $21
  • Danaher (DHR) initiated with an Overweight at Wells Fargo; tgt $170
  • Everbridge (EVBG) initiated with a Perform at Oppenheimer
  • Five9 (FIVN) initiated with an Outperform at Robert W. Baird; tgt $80
  • Globus Medical (GMED) initiated with a Buy at SunTrust; tgt $67
  • Halozyme Therapeutics (HALO) initiated with a Buy at Goldman; tgt $24
  • Hawaiian Electric (HE) initiated with a Neutral at Guggenheim; tgt $44
  • Hologic (HOLX) initiated with an Equal Weight at Wells Fargo; tgt $57
  • Horizon Pharma (HZNP) initiated with a Neutral at Goldman; tgt $35
  • ICON plc (ICLR) initiated with an Equal Weight at Wells Fargo; tgt $180
  • Illumina (ILMN) initiated with an Underweight at Wells Fargo; tgt $300
  • Medtronic (MDT) initiated with a Buy at SunTrust; tgt $130
  • Quest Diagnostics (DGX) initiated with an Underweight at Wells Fargo; tgt $100

Upcoming Events:

• Econ Data (Thursday):
  • 08:30 ET: Weekly Initial Claims (Briefing.com consensus 225,000; prior 222,000) and Continuing Claims (prior 1.728 mln)
  • 10:30 ET: Weekly natural gas inventories (prior -58 bcf)
• Earnings:
  • Monday (January 6)
    • Pre-Market: CALM, CMC
    • After-Hours: None of note
  • Tuesday (January 7)
    • Pre-Market: ANGO
    • After-Hours: None of note
  • Wednesday (January 8)
    • Pre-Market: STZ, GBX, LEN, MSM, RPM, SCHN, UNF, WBA
    • After-Hours: BBBY, HELE
  • Thursday (January 9)
    • Pre-Market:  AYI, AZZ, LNN, SMPL
    • After-Hours: KBH, PSMT, SNX, WDFC
  • Friday (January 10)
    • Pre-Market:  INFY
    • After-Hours: None of note
    • Full Earnings Calendar