Friday Morning Reads
- Canadian marijuana users or investors could soon receive lifetime travel ban to the United States. Note: This would likely receive Court challenges if enacted (MJ, CRON, TLRY, CGC). Politico Report
- Fox (FOXA) and Comcast (CMCSA) are in talks to settle auction rules for Sky (SKYAY) M&A deal. Bloomberg Report
- Deutsche Bank (DB) is now only comfortable dealing with 10% of Danske Bank clients. FT Report
- Adolphus Busch wants Anheuser-Busch (BUD) to sell marijuana. NY Post Report
- Naomi Osaka is close to agreeing to deal with Adidas (ADDYY). NY Post Report
- Governor Cuomo defeated progressive challenger in NY Governor primary, as Letitia James gets Democratic nomination for Attorney General (XLF). NY Times Report -- Full Results
- China believes WTO needs reforms but will not meet demands from the U.S. about trade (FXI). Reuters Report
- Paul Manafort has agreed to tentative plea deal, but it is unclear if it includes corporation. ABC News Report
- Futures higher ahead of data release
- Pot stocks poop out as Canadian weed investors may be barred from U.S.
- Amazon HQ2 decision coming soon
- Carolinas brace for Hurricane Florence
- NIO +70% in second day stunner
- AMD hits seven-month low on volume
- Congress asks Google about China plans
- Nike all-time high amid Kaepernick campaign
- The Watchlist
- Week Ahead Webinar
- Today's Option Recap
- 2018 Top 5 For Back Half of 2018
- 2018 Top 5 Stocks
Florence was downgraded to a Category 1 storm on Thursday evening, but its sheer size and predicted deceleration means it could batter the U.S. East Coast with hurricane-force winds for nearly a full day. Over 150K people in North Carolina are already without power, while about $30B-60B in economic impact and damage is expected. Sectors on watch include insurers, agriculture, healthcare, electricity providers and building supplies. Related tickers: LPNT, CYH, THC, HCA, HD, LOW, DUK, D, ALL, CB, AIG, TRV, PGR, GNRC, CORN, WEAT, SGG, SOYB, JJG, BALB, COW, CANE, GRU, UBC
Another storm is raging in the Pacific called Mangkhut, which is predicted to be one of the strongest systems on record. The Super Typhoon has already dwarfed Hurricane Florence, and is set to break records as it howls towards Hong Kong and the Philippines. It tore through Guam and the Marshall Islands earlier this week with wind speeds of up to 180 miles per hour.
"The Wall Street Journal has it wrong, we are under no pressure to make a deal with China, they are under pressure to make a deal with us," President Trump tweeted on Thursday. He also took note of "surging" U.S. markets vs. "collapsing" Chinese markets. The S&P 500 is up 4.5% over the past three months vs. a 12% decline for the iShares China Large Cap ETF (NYSEARCA:FXI).
An economic data cluster is on tap this morning. U.S. retail sales and import prices will come out at 8:30 a.m. ET, followed by industrial production figures at 9:15 a.m. ET, and consumer sentiment and business inventories data at 10:00 a.m. ET. U.S. stock index futures are edging higher ahead of figures, with the Dow and S&P 500 up 0.2%, and the Nasdaq up 0.4%.
British business is responding to yesterday's comments made by BOE Governor Mark Carney, who said a "no-deal" Brexit would result in a 35% crash in home prices and the unemployment rate more than doubling. Major U.K. companies have warned of the risk of border delays and additional charges, but some Brexiteers are calling Carney's predictions "completely wrong." J.D. Wetherspoon (OTCPK:JDWPY) founder Tim Martin said he's got a "terrible record for making these sort of predictions."
It's just been a few weeks since the rollout of Venezuela's new money, which stripped five zeros off the bolivar, but inflation of the new currency is already 100%. That would push annual inflation above 100,000%, according to Bloomberg's inflation scale. It comes as Venezuela's Nicolas Maduro meets with President Xi of China, one of his ailing country's biggest creditors, which has reportedly agreed to extend a $5B credit line.
NiSource -7.4% premarket after dozens of gas explosions killed at least one person, injured 12 more and forced thousands to evacuate from three communities north of Boston. Some 70 fires, explosions or investigations of gas odor were reported, according to Massachusetts State Police. NiSource's (NYSE:NI) Columbia Gas unit had said earlier that it would be upgrading gas lines in neighborhoods across the state.
Taking a giant leap toward commercializing space travel, SpaceX (SPACE) has signed up its first passenger for a flight around the moon, with the person's identity to be revealed on Sept. 17. Asked whether he'd be the first passenger, CEO Elon Musk - who's also the head of Tesla (NASDAQ:TSLA) - posted an emoji of a Japanese flag. SpaceX's valuation has climbed to about $28B, making it the third-most valuable venture-backed startup in the U.S. after UBER and Airbnb (AIRB).
Next frontier in 5G... AeroVironment (NASDAQ:AVAV) and SoftBank (OTCPK:SFTBY) have disclosed details of their joint venture HAPSMobile. In the initial phases of the project, the companies will develop a stratospheric airplane that is powered 100% by solar energy. "It's going to fly on the edge of the atmosphere and bring 5G connectivity to the entire world."
Volkswagen is halting production of its iconic Beetle next year, ending an 80-year run for a car that introduced many Americans to the German brand in the 1960s. It's one of the longest-lived and best-selling vehicles of all time, with 22.7M sold worldwide. VW (OTCPK:VLKAY) said the move comes as it focuses on other models and its EV lineup, but left the door open for a potential return of the nameplate.
Following many rumors, 16 bipartisan members of the U.S. House of Representatives have asked Google (GOOG, GOOGL) if it will re-enter the Chinese search engine market and if it would comply with local censorship policies upon its return. While the tech giant didn't comment, discontent over the controversial effort is circulating at the company. Seven Google employees have reportedly quit their jobs over the endeavor that's codenamed Dragonfly.
Facebook is expanding its fact-checking efforts in a move that will delve into the world of memes. A new machine learning model uses various signals (including user feedback) to find potentially false content in photos and videos. The flagged items will then be sent to fact-checkers, helping Facebook (NASDAQ:FB) "identify and take action against more types of misinformation, faster."
Jeff Bezos sidestepped a question on Thursday about the winner of Amazon's (NASDAQ:AMZN) second headquarters, but said the decision will be announced "before the end of the year." The company previously selected 20 finalists in North America for HQ2, a recipient that will receive investment of $5B and 50K jobs. Amazon's primary headquarters is located in Seattle, WA, a move partly inspired by Microsoft (NASDAQ:MSFT).
Transformation? UPS is bolstering services to boost shipments between businesses as part of a $20B push to automate its network. The move, which is hoped to result in an incremental EPS increase to $1.00-$1.20 by 2022, would offset lower-profit home deliveries from Amazon (AMZN) and other online retailers. UPS also called out further penetration of the Healthcare and Life Sciences logistics market.
"When it comes to (cryptocurrency) fraud and manipulation, we need to be strong. When it comes to policymaking, I think we need to be slow and deliberate and well informed," said U.S. Commodity Futures Trading Commission Chairman J. Christopher Giancarlo. Speaking to CNBC at the annual Singapore Summit, he added that the internet flourished because the government did not step in too heavily, and applied a "do no harm" approach.
Nike's stock closed at an all-time high on Thursday, hitting a record $83.47 per share. The company has been at the center of controversy after last week's choice to make former NFL quarterback Colin Kaepernick the face of its 30th anniversary "Just Do It" campaign. At the time, some predicted the marketing move would tank Nike's (NYSE:NKE) stock valuation, while others claimed it was a genius business decision.
Bringing it closer to becoming a global top 10 drugmaker, Takeda Pharmaceutical (OTCPK:TKPYY) has received approval from China's market regulator for its $62B acquisition of Shire (NASDAQ:SHPG). The deal - which will be the largest overseas purchase by a Japanese company - has already received unconditional clearance from regulators in the U.S. and Brazil, and awaits approval from Japan and the EU. SHPG +2.2% premarket.
Cannabis-related stocks tumbled after-hours on Thursday following a Politico report that the U.S. may bar Canadians who work in the marijuana industry or invest in the companies from entering the U.S.: TLRY -9.2%, CGC-2.4%, CRON -4.6%. Canada is set to become the world’s only major industrialized nation to legalize retail marijuana sales, starting Oct. 17.
In Asia, Japan +1.2%. Hong Kong +1%. China -0.2%. India +1%.
In Europe, at midday, London +0.3%. Paris +0.3%. Frankfurt +0.3%.
Futures at 6:20, Dow +0.2%. S&P +0.2%. Nasdaq +0.4%. Crude +0.3% to $68.77. Gold +0.2% to $1210.70. Bitcoin -0.6% to $6447.
Ten-year Treasury Yield +2 bps to 2.98%Today's Economic Calendar
8:30 Retail Sales
8:30 Import/Export Prices
9:00 Fed's Evans: Monetary Policy and Economic Outlook
9:15 Industrial Production
10:00 Business Inventories
10:00 Consumer Sentiment
1:00 PM Baker-Hughes Rig Count