Stocks fell again on Wednesday, with the S&P losing .33% in a choppy session. Asia markets closed lower overnight while Europe indexes are in the green this morning. U.S. futures are pointing to a lower open, the Dollar, Yields, and Gold are higher while Oil is lower.
And this is what UPB is reading this morning: https://www.optionmillionaires.com/morning-reads-118/
It was a choppy session yesterday ahead of todays much anticipated inflation data. The CPI came in higher than expected this morning and futures tumbled on the report. S&P futures are pointing to a 2.00% lower open as I write this, just nasty. All this does is add fuel to the Feds rate hiking fire... a .75% hike at the November meeting is now likely and maybe the market starts pricing in a 1% hike. I have said it before, I think the U.S. is already in a recession so now it is about trying to figure how far in we are. The market is a great forward looking mechanism, so at some point it will start pricing in a return to growth. The $350 handle on the SPY is key support as mentioned yesterday. If that does not hold $330 and below possible in the coming weeks:
I closed my DPZ puts flat yesterday ahead of their earnings this morning. The stocks is gapping higher this morning despite another lackluster report. Looks like a lot of the negativity is priced into the name already. Likely will take off the watch list for now and relived to have taken the risk off into earnings.
I also closed my IWM puts out yesterday for a small gain as I didn't want to hold into the CPI number this morning. May revisit IWM and/or TZA this morning if the SPY fails to hold that $350 handle:
Reports TikTok was rolling out their own music service put pressure on SPOT yesterday afternoon. Thankful to have locked my calls in. Still think SPOT has a large moat around their business and is attractive at these levels. May look at some calls again today if the market finds support at $350:
And still eyeing GNRC & CME for potential bounce plays:
Here are the analyst changes of note for today
| Oppenheimer sees more difficulty for Microsoft/Activision to win CMA approval |
| Oppenheimer analyst Andrew Uerkwitz notes that on Wednesday, the U.K.'s CMA, or Competition and Markets Authority, published the full text of its phase 1 inquiry into the Microsoft (MSFT)/Activision Blizzard (ATVI) merger. After reviewing the document, the analyst sees incrementally less risk of PlayStation losing access to Call of Duty games, and believes Xbox Game Pass leading market share and Microsoft's ecosystem advantage in cloud streaming pose a higher risk of unfavorable ruling on the merger. Moreover, Uerkwitz sees strong strategic incentives for Microsoft to pursue Activision despite potential for more concessions on content exclusivity. Overall, the analyst sees incrementally more difficulty for Microsoft/Activision to win CMA approval of the deal due to Microsoft/Xbox's advantageous positioning in game subscription and cloud streaming. He expects Sony (SONY) to benefit from further concessions by Microsoft/Activision regarding content access and content parity on the latter's Call of Duty franchise |
| Applied Materials price target lowered to $95 from $126 at Craig-Hallum |
| Craig-Hallum analyst Christian Schwab lowered the firm's price target on Applied Materials to $95 from $126 and keeps a Buy rating on the shares after the company lowered its Q4 guidance following the recently announced new U.S. export regulations for semiconductor technology sold into China. The company expects to see a $400 million revenue impact from the new regulations in Q4, partially offset by a better-than-expected supply chain, and for a similar $400 million impact to sales in Q1 as they work to gain additional export licenses where needed, the analyst notes |
| Northern Oil and Gas assumed with an Outperform at Northland |
| Northland analyst Donovan Schafer assumed coverage of Northern Oil and Gas with an Outperform rating and $50 price target. Northern Oil, which is focused in the Permian and Williston, has a model that supports higher ROE and predictability with scale and access to more data in each basin due to the company's non-operating approach, Schafer tells investors. The company "has in-basin expertise beyond what's possible for most operators, with less overhead, and distance from day-to-day operations" that gives it a better perspective when making capital allocation decisions, Schafer argues. |
| GameStop transferred with a Hold at Jefferies |
| Jefferies analyst Andrew Uerkwitz took over coverage of GameStop with a Hold rating and $26 price target as the firm's Interactive Entertainment Team took over lead coverage of Toys & Entertainment Products coverage in a move they describe as "complementary to the industry's evolution as IP driven Gaming, Media, Entertainment companies." In taking over coverage of the stocks, Uerkwitz and the team adjusted estimates to account for slowing underlying demand and a more constrained consumer, slightly offset by improving freight and resin costs, and additional currency headwinds due to a stronger U.S. dollar. |
Hasbro transferred with a Buy at Jefferies |
| Jefferies analyst Andrew Uerkwitz took over coverage of Hasbro with a Buy rating and $95 price target as the firm's Interactive Entertainment Team took over lead coverage of Toys & Entertainment Products coverage in a move they describe as "complementary to the industry's evolution as IP driven Gaming, Media, Entertainment companies." In taking over coverage of the stocks, Uerkwitz and the team adjusted estimates to account for slowing underlying demand and a more constrained consumer, slightly offset by improving freight and resin costs, and additional currency headwinds due to a stronger U.S. dollar |
And here is what I am watching : DPZ, SPOT, CME, GNRC. LOCO, TZA, IWM, WING, BLK, APRN, PTON, ROKU, TWLO, CMG, U, WIX, CI, TRIP, SAGE, and PTCT.
Let's have a great day!
-JB