Thursday’s Market Prepper

Thursday's Market Prepper






Unusual Option Action Yesterday



The White House Space Council meets for the first time today to set out an agenda of national space priorities and launch schedules. Key executives expected to attend the public session of the gathering include Boeing (NYSE:BA) CEO Dennis Muilenburg and Lockheed Martin (NYSE:LMT) CEO Marillyn Hewson. Part of the focus will be on NASA's timetable for reaching Mars after Elon Musk announced accelerated plans for SpaceX (Private:SPACE) to reach the red planet. President Trump has called space the next great American frontier.


European bourses are fighting to avoid posting back-to-back losses for the first time in a month, with the Stoxx Europe 600 Index down 0.33%. Germany's DAX has edged lower after a record close, while Spain's IBEX 35 is rebounding from a large drop on Wednesday with a 0.50% gain. It was a quiet day for Asian stocks, with markets in Hong Kong, China and South Korea all closed for national holidays. U.S. stock futures are level after yesterday's records for the Dow, S&P 500 Index and Nasdaq. If the S&P 500 Index closes higher today, it will mark the first stretch of six consecutive new all-time highs since 1997.

Fed watch: Speculation is ramping up over the potential impact of former Fed governor Kevin Warsh being appointed as the next chairman of the central bank. Warsh favors reduced regulation on banks and could de-emphasize the Fed's reliance on utilizing an inflation target as a guide for interest rate hikes. While his rhetoric leans to the hawkish side, some analysts point out that his voting record is mixed. On the Fed calendar today, San Francisco Fed president John Williams is scheduled to speak at a community banking conference, while Philadelphia Fed president John Harker and Kansas City Fed president Esther George are both on tap to talk at a workforce conference.

Trade representatives of the United States and South Korea will amend the two countries' trade deal, a pact that has come in for criticism from President Trump, who has argued for exiting it. Trump would like to close a trade deficit largely fueled by South Korea's exports of cars and mobile phones (though that's been narrowing). But the agreement has solid defenders in Congress, including those from agricultural states.

Crude oil prices are slightly higher after a stretch of declines tied to oversupply concerns and some booking of profits. Traders have their eyes on a tropical depression that could develop into a hurricane that threatens the U.S. Gulf Coast on Sunday. WTI crude oil futures +0.48% to $50.22/bbl at last check. Brent crude +0.99% to $56.35/bbl.

The National Retail Federation expects holiday sales to increase between 3.6% and 4.0% this year. The forecast is higher than the 3.5% annual growth seen over the past five years. Retailers are expected to hire between 500K and 550K temporary workers this holiday season, down from last year's total of 575K. Wal-Mart (NYSE:WMT) won't be part of that tally due to its decision to meet the holiday crush by adding hours for current employees.

The Interior Department reportedly will propose delaying parts of an Obama administration rule to limit methane emissions from oil and gas production on federal lands, even after the U.S. Senate rejected a resolution to revoke the rule earlier this year. The rule, finalized by the Bureau of Land Management two months before former Pres. Obama left office, requires oil and gas operators on public lands to prevent leaking, venting and flaring of methane. Drillers on federal lands produced 9% of the natural gas and 5% of the oil in the U.S. last fiscal year.


Delivery bombshell: Amazon (NASDAQ:AMZN) is testing out a new delivery service that will make more products available for free two-day delivery. The program sees more deliveries made straight from the warehouses of third-party merchants straight to the homes of customers. The method cuts down on warehouse overcrowding and could reduce Amazon's reliance on FedEx (NYSE:FDX) and UPS (NYSE:UPS). In premarket trading, FedEx is down 2%and UPS is off 3%.

Bain Capital said it plans to list the chip unit of Toshiba (OTCPK:TOSBFOTCPK:TOSYY) on the Tokyo Stock Exchange within three years after settling a legal dispute with Western Digital Corp. (NYSE:WDC). In advance of a potential sale, the private equity firm aims to achieve stability at the chip unit through key client Apple (NASDAQ:AAPL).

Legoland owner Merlin Entertainment is said to be interested in making a deal for parts of SeaWorld Entertainment (NYSE:SEAS). Sources indicate SeaWorld has also received interest from other suitors. The theme park operator is believed to prefer an outright sale over selling assets. Shares of SeaWorld are up 7.7% in premarket trading.

A Senate panel approved a self-driving car bill that creates a national framework of regulations for the industry. The bill includes amendments covering cybersecurity issues and allows automakers to sell up to 80K self-driving vehicles annually if safety standards are met. Self-driving commercial trucks aren't included in the legislation. It's been a busy week on the autonomous vehicle front in general, with Ford mapping its strategy to funnel investments into self-driving cars and General Motors (NYSE:GM) tipping off that its Cruise Automation business is making "rapid progress" on fully autonomous driving capabilities.

With the deadline of October 24 approaching quickly, German firm Linde (OTCPK:LNAGFOTCPK:LNEGY) asked investors to tender their shares for the planned merger with Praxair (NYSE:PX). As of October 4, only 27.7% of Linde shares have been accepted. The deal needs an acceptance rate of 75% to fly.

In a business update, early-stage human tissue developer Organovo (NASDAQ:ONVO) says it will cut 13% of its workforce to reduce costs, and issued preliminary revenues for its second quarter below Street consensus. The company will take a restructuring charge with the layoffs but expects to save millions, and it sees Q2 revenues falling 2% from a year ago.

Creating a high-tech urban space is on the radar of Alphabet (NASDAQ:GOOG) as it closes in on a deal to develop a 12-acre chunk of the Toronto waterfront. The tech giant's Sidewalk Labs unit would back the construction projects, which will initially create a 3M square foot facility to pair with a 750-acre development on adjacent land. Details are scarce, but construction cost estimates put the project over $1B.

There are high expectations for Warner Bros. (NYSE:TWX) feature Blade Runner 2049 after a blistering pace of advance ticket sales and some rave reviews from key publications. "Blade Runner 2049 ranks as one of the great science-fiction films of all-time," gushed Variety's Peter Debruge. The long-awaited sci-fi film has an outside chance of breaking the all-time October opening record of $55.7M recorded by Gravity in 2013, despite the 183-minute run time limiting the numbers of showings per day. Even if it falls short of a record, the film is expected to provide a Q4 box office bounce for Cinemark (NYSE:CNK), Regal Entertainment (NYSE:RGC), Carmike Cinemas (NASDAQ:CKEC), IMAX (NYSE:IMAX) and AMC Entertainment (NYSE:AMC).

Marni Walden will step down from her leadership post at Verizon (NYSE:VZ), where she was in charge of Media and Telematics, at the end of the year. Walden had a prominent role during Verizon's bumpy courtship of Yahoo (which it bought in a $4.5B acquisition). Her departure means that AOL veteran Tim Armstrong, now in charge of Verizon's Oath media businesses, will report directly to CEO Lowell McAdam.

Wednesday's Key Earnings
Resources Connection (NASDAQ:RECN+1% AH on in-line earnings.

Today's Markets 
In Asia, Japan +0.01%. Hong Kong closed. China closed. India -0.25%.
In Europe, at midday, London +0.17%. Paris -0.07%. Frankfurt -0.23%.
Futures at 6:20, Dow flat. S&P falt. Nasdaq +0.05%. Crude +0.24% to $50.10. Gold +0.27% to $1,280.20.
Ten-year Treasury Yield -7 bps to 2.325%

Today's Economic Calendar
Chain Store Sales
7:30 Challenger Job-Cut Report
8:30 Initial Jobless Claims
8:30 International Trade
9:10 Fed's Powell speech
9:30 Fed's Harker Speech
9:45 Bloomberg Consumer Comfort Index
10:00 Factory Orders
10:30 EIA Natural Gas Inventory
4:30 Money Supply
4:30 Fed Balance Sheet
9:00 Fed's George speech

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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