Markets closed higher on Wednesday, with the S&P adding .29%, putting an end to a 3 session losing streak. Asia stocks closed higher overnight while Europe indexes are in the green this morning. U.S. futures are pointing to a higher open this morning, the Dollar and Oil are lower while Yields and Gold are higher.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-87/
Stocks closed higher on Wednesday, with the SPY breaking over $415 by lunchtime before closing at $413.67. There was no catalyst to speak of outside of POTUS announcing student loan debt forgiveness. Tomorrow is the big day, with PCE data and Powell's 10am speech at Jackson Hole. Usually there are prepared remarks released before the open so would think tomorrow will be the same. Unless Powell is extremely hawkish, think stocks can continue to find footing. Expectations have already spiked for a .75% hike at September's FOMC meeting with the market implying a 61% chance of that happening, so markets have this priced in already. Would like to see the SPY break and hold $415 today and then think a retest of $420s come tomorrow:
PTON gapped higher yesterday on the news they would be selling their products on AMZN. Have to think this will only create more chatter on a possible AMZN acquisition. I went and added calls and was able to flip some for 100% to cover costs. This morning they reported disappointing results... not shocking. Would not be surprised to see this reverse after the open and may look at some other calls to play for a bounce:
New short data came out after the close yesterday and it showed ICPT shorts adding nearly 1 million more shares to their bearish position. Nuts considering the positive developments on ICPT the last few weeks. Think $20+ is coming today and will look to add some more later dated strikes:
APRN rallied nearly 7% yesterday and is gapping higher this morning. This will trade much higher in the coming weeks in my humble opinion. Will wait for a break into the $6s before adding some October calls:
ULTA reports earnings after the close today. Although I am very bullish the name, not sure I want to keep the risk on into the report, so may look to close my calls in and revisit at the open tomorrow. A strong beat and raise and the stock should trade north of $450:
SCVL reported dismal earnings this morning and the stock is gapping lower. Will likely take off the watchlist and revisit.
Will be watching SPOT, TWLO, PANW, and ROKU today for potential speculative calls.
Here are the analyst changes of note for today:
| Nvidia data center deceleration gives Morgan Stanley 'pause' |
| Morgan Stanley analyst Joseph Moore said Nvidia's weaker guidance in its gaming business should "clearly frame the bottom" after a 60% decline in quarterly revenues in just two quarters. However, the data center deceleration and ancillary issues around that business give him "pause" given the elevated multiple and the "unexpected questions" on the data center side keep him at Equal Weight with a $182 price target on the shares following the company's quarterly report |
| Nvidia price target lowered to $198 from $216 at Truist |
| Truist analyst William Stein lowered the firm's price target on Nvidia to $198 from $216 and keeps a Buy rating on the shares. The company's Q3 guidance was well below consensus as gaming and pro-viz continue to correct, but bears will focus on the potential for weakness to spread to datacenter, the analyst tells investors in a research note. Stein maintains however that Nvidia remains best positioned to capture share in the datacenter long-term because its GPU leadership is sticky |
Costco upgraded to Buy from Hold at Erste Group |
| Erste Group analyst Hans Engel upgraded Costco to Buy from Hold. Costco Wholesale is showing strong sales growth, has been able to increase its key profitability ratios in recent quarters and the outlook for continued sales and profit growth is good, Engel tells investors |
| Splunk price target lowered to $117 from $125 at Deutsche Bank |
| Deutsche Bank analyst Brad Zelnick lowered the firm's price target on Splunk to $117 from $125 and keeps a Hold rating on the shares post the results |
| Brinker price target raised to $29 from $26 at RBC Capital |
| RBC Capital analyst Christopher Carril raised the firm's price target on Brinker to $29 from $26 but keeps a Sector Perform rating on the shares. The company's Q4 results missed expectations but the tone from new CEO Kevin Hochman implied the urgency with which Brinker is focusing its efforts on improvement in revenue and margins both near and long term, the analyst tells investors in a research note. Carril adds that Brinker's pricing power and ability to create operational efficiencies in some areas of the business are key factors in supporting margins, though he is cutting his FY23 EPS view to $2.46 from $3.81 |
WWE price target raised to $84 from $79 at MKM Partners |
| MKM Partners analyst Eric Handler raised the firm's price target on WWE to $84 from $79 and keeps a Buy rating on the shares. The analyst cites the company's stronger than anticipated Q2 results and Q3 guidance, improving 2022 outlook and long-term growth opportunities. Handler further notes the upcoming U.S. TV rights negotiations for Raw and Smackdown providing the most significant catalyst as well as incremental opportunities with Advertising & Sponsorship and WWE's international expansion also "remaining meaningful" |
And here is what I am watching today: ULTA, YOU, SAGE, PTON, PANW, ICPT, ROKU, SPOT, and TWLO.
Let's have a great day!
-JB