Thursday Morning Reads

Thursday Morning Reads



Todays Top Open Interest Changes:

Morning Charts:


U.S. stock index futures are on edge once again, flipping between red and green overnight, as the Trump administration delivered a one-two punch to China's Huawei Technologies. A ban was announced that will bar the firm from buying vital U.S. technology without special approval and effectively prohibits its equipment from U.S. telecom networks on national security grounds. Speculation as to whether China would dump its U.S. debt as a trade war weapon was also renewed as Beijing sold the most Treasurys in almost 2.5 years in March, offloading $20.45B and taking the country's total holdings to $1.12T.

More tariff talk

Some relief was seen yesterday as the Dow closed up another 116 points as multiple sources revealed that President Trump planned to postpone European auto tariffs by up to six months ahead of a Friday midnight deadline. Meanwhile, Treasury Secretary Mnuchin said the U.S. was "close to an understanding" with Canada and Mexico on resolving steel and aluminum tariffs that were not resolved during negotiations over their new trade agreement. Key lawmakers have signaled they would not vote for USMCA unless the levies were removed.

13F filings

Warren Buffett's Berkshire Hathaway (BRK.ABRK.B) said it owned 483,300 shares of Amazon (NASDAQ:AMZN) as of March 31, a stake worth more than $900M based on the company's closing price on Wednesday of $1,871.15. Berkshire further increased its holdings of JPMorgan (JPM) and Red Hat (NYSE:RH), while reducing its bets on Southwest Airlines (NYSE:LUV) and Wells Fargo (NYSE:WFC). Some of the highest-profile U.S. hedge funds, like Tiger Global and T. Rowe Price (NASDAQ:TROW), also fell back in love with FAANGs in the first quarter, according to regulatory filings.

Walmart earnings on deck

The stakes are high for Walmart (NYSE:WMT) this morning as it reveals its battles for a piece of the e-commerce pie, with recent reports suggesting the company was making progress on this front as well as winning more share in grocery. Investors will also be watching out for guidance on the economy and consumer demand, as the threat from Chinese tariffs and resultant price increases loom large. Last year was a tough one for Walmart, with many worrying that the retail giant was paying too dearly for growth as it battled Amazon (AMZN).

Release date for Galaxy Fold?

According to Yonhap, Samsung (OTC:SSNLF) is now testing the units with mobile carriers in South Korea after fixing several key issues. It has integrated the display's protective layer inside the screen to prevent people from tearing it off and has filled a gap near the hinge to avoid debris from getting inside the device and damaging components. Samsung had to eventually cancel all pre-orders of the device and postpone its launch, but Galaxy Fold is now set to hit the market in June.

E-cig stocks on watch

U.S. Federal Judge Paul Grimm has ordered the FDA to begin its review of e-cigarettes, calling the agency's delay "so extreme as to amount to an abdication of its statutory responsibilities." FDA Commissioner Scott Gottlieb - who departed last month - previously ruled that e-cig manufacturers would not have to submit their products for review until 2021, saying more time is needed to prepare for regulation. Separately, North Carolina's attorney general has announced the first state lawsuit against Juul (JUUL), which dominates the U.S. vaping market, saying, "we cannot allow another generation of young people to become addicted to nicotine."

Forex rigging fines

The financial industry has been hit with billions of euros in fines worldwide in the last decade for manipulating key benchmarks. This morning saw the latest penalties from EU antitrust regulators, which fined Barclays (NYSE:BCS), Citigroup (NYSE:C), JPMorgan (NYSE:JPM), Mitsubishi UFJ Financial (NYSE:MUFG) and Royal Bank of Scotland (NYSE:RBS) a total of €1.07B for rigging the spot foreign exchange market for 11 currencies. Swiss peer UBS (NYSE:UBS) was not penalized as it alerted the two cartels to the European Commission.

Boeing targeted at 737 MAX hearing

The U.S. planemaker received some rough treatment yesterday at a hearing of the House aviation subcommittee, whose chairman said the FAA has a "credibility problem" with its safety certification of the 737 MAX. Acting FAA chief Dan Elwell expects Boeing (NYSE:BA) to submit a software fix in the "next week or so" and is concerned by its lengthy delay in disclosing the anomaly. He also said Boeing should not have waited 13 months to tell the FAA that it inadvertently made an alarm alerting pilots to a mismatch of flight data optional on the MAX, instead of standard as on earlier 737s.

What else is happening...

Contributor Ploutos discusses yield curve inversions, while Avi Gilburt asks if "bonds are warning us."

GE (NYSE:GEneeds more time for power-plant unit to recover.

PG&E (NYSE:PCG) blamed for deadliest wildfire in California history.

High winds lead SpaceX (SPACE) to postpone Starlink launch.

T. Rowe Price (TROWsells most of Tesla (NASDAQ:TSLA) stake; EV maker boosts jobs in NY.

New coalition of CEOs pushes Congress for climate action.

WeWork (VWORKurges investors to see losses as "investments."

After Impossible Whopper, Burger King (NYSE:QSRintroduces the Traffic Jam Whopper.

Nestle (OTCPK:NSRGY) in talks over $10B sale of skin health unit.

Wednesday's Key Earnings
Alibaba (NYSE:BABA+1.6% returning to robust growth.
Cisco (NASDAQ:CSCO+2.8% AH giving strong revenue guidance.
Macy's (NYSE:M-0.5% as negative sentiment shadowed results.

Today's Markets 
In Asia, Japan -0.6%. Hong Kong flat. China +0.6%. India +0.4%.
In Europe, at midday, London -0.2%. Paris -0.2%. Frankfurt -0.1%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq -0.2%. Crude +0.7% to $62.48. Gold +0.2% to $1295.70. Bitcoin +0.6% to $8046.
Ten-year Treasury Yield -1 bps to 2.37%

Today's Economic Calendar
8:30 Housing Starts
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
10:30 EIA Natural Gas Inventory
12:05 PM Fed's Kashkari Speech
4:30 PM Money Supply
4:30 PM Fed Balance Sheet

Known to most as Uranium Pinto Beans, Jason has more than 15 years under his belt of trading stocks, options and currencies. His expertise primarily lies in chart analysis, and he has a strong eye for undervalued stock. Because he’s got the ability to identify great risk/reward trades he usually enjoys taking the path less traveled and reaping the benefits from the adventure.

He is a co-founder of Option Millionaires, and he is best known for his weekly webinars with Scott, as well as his high level training webinars and charts found in the forums.

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