Wednesday Morning Reads

• Top Morning Charts
• Breakout Scan
• Inverted Head and Shoulder Scan
• Topping Out?

An Early look at today:

Stock futures are flat to slightly higher ahead of several upcoming catalysts the next few days including Apple’s (AAPL) annual product release later today, the Fed Beige Book later this afternoon, central bank policy meetings for both the European Central Bank (ECB) and Bank of England (BOE) tomorrow morning, ad the expected impact of Hurricane Florence as it barrels towards the Carolinas. You can throw in a monthly gauge of inflation in the form of Producer Prices (PPI) this morning and a weekly oil inventory report to the mix as well. Trade tensions between the U.S. and its partners have put pressure on global markets in recent months, but American equities have continued to get a boost despite the disputes between the US and trading partners in China, Canada and the EU. Stocks rose on Tuesday, wiping out earlier losses, as Apple rallied into its product announcement, leading the Dow and Nasdaq Composite higher. Stocks had opened lower as Reuters reported that China plans to ask the World Trade Organization for authority to impose trade sanctions on the U.S. Energy stocks also surged on the back of higher oil prices, with WTI crude jumping 2.5% to one-week closing highs. Overnight in Asian markets, The Nikkei Index fell -60 points to 22,604, the Shanghai Index slipped -8 points to settle at 2,656 and the Hang Seng Index dropped -77 points to end at 26,345. In Europe, the German DAX is up about 20 points trading under 12,000, while the FTSE 100 is down a few points around 7,260.

Market Closing Prices Yesterday

· The S&P 500 Index jumped 10.76 points, or 0.37%, to 2,887.89

· The Dow Jones Industrial Average rose 113.99 points, or 0.44%, to 25,971.06

· The Nasdaq Composite gained 48.31 points, or 0.61%, to 7,972.47

· The Russell 2000 Index advanced 0.94 points, or 0.05% to 1,718.40

Events Calendar for Today

· 7:00 AM EST MBA Mortgage Applications Data

· 8:30 AM EST Producer Price Index (PPI) MoM for Aug…est. 0.2%

· 8:30 AM EST PPI Ex: Food & Energy MoM for Aug…est. 0.2%

· 9:30 AM EST Fed’s Bullard speaks to CFA Society in Chicago

· 10:30 AM EST Weekly DOE Inventory Data

· 2:00 PM EST Fed Beige Book Released

Earnings Calendar:

· Earnings Before the Open: COOL, EYPT

· Earnings After the Close: ACET, PVTL, OXM, SAIC, TLRD

Other Key Events:

· Barclay’s Global Financial Services Conference, 9/12-9/14, in New York

· CLSA Investors Forum, 9/11-9/14 in Hong Kong

· Credit Suisse 31^st Annual Basic Materials Conference, 9/11-9/13 in New York

· Deutsche Bank Technology Conference, 9/12-9/13, in Las Vegas

· Morgan Stanley 16^th Annual Global Healthcare Conference, 9/12-9/14, in New York

· Mobile World Congress Americas, 9/12-9/14

World News

· Hurricane Florence is expected to slow down considerably by late Thursday into Friday, and move through early Saturday, the center of Florence will move over the southwestern Atlantic Ocean between Bermuda and the Bahamas today, and approach the coast of North Carolina or South Carolina in the hurricane warning area on Thursday and Friday

· Vladimir Putin said the two men accused by the UK of being Russian spies who staged a nerve agent attack in Salisbury were ordinary citizens with “nothing criminal” about them – FT

Sector News Breakdown

Consumer

· An activist investor wants cosmetics company e.l.f. Beauty Inc. (ELF) to give itself a makeover. Marathon Partners Equity Management LLC, which owns about 8.5% of e.l.f., plans to urge the discount cosmetics seller to either start a process to sell itself or refocus on core operations and reduce costs, the WSJ reportedhttps://on.wsj.com/2NytAO6

· NIO Inc. (NIO) 160M share IPO priced at $6.26

· Farmer Bros (FARM) Q4 EPS 0c/$149.5M vs. est. 12c/$152.65M; Q4 adjusted Ebitda $14.0M

· New York & Company (NWY) reported a rebranding plan that included a name change to RTW Retailwinds

· PGT, Inc. (PGTI) files to sell 7M shares of common stock

Energy

· The American Petroleum Institute (API) reported that U.S. crude supplies dropped by -8.6M barrels for the week ended Sept. 7, while supplies of gasoline rose 2.1M barrels and distillate stockpiles climbed by 5.8M barrels

· SSE PLC (SSE.LN) said it expects adjusted operating profit for the 1H19 to fall by half compared with the year earlier period, citing the impact of high gas prices and warm weather.

· Pioneer Natural Resources Company (PXD) and U.S. Silica Holdings, Inc. (SLCA) announced that the companies have entered into a long-term sand supply agreement by which Pioneer will purchase an interest in U.S. Silica’s sand reserves at its Lamesa, Texas, mine in West Texas.

· Northern Oil (NOG) Q3 production tracking significantly above view as announced preliminary results for July and August averaged over 25,000 Boe/d vs prior est. of 23,000-24,000 Boe/d for 3Q

· The Trump administration on Tuesday proposed less stringent requirements for oil-and-gas companies dealing with methane-gas leaks, weakening an Obama administration rule intended to combat climate change.

Financials

· Franklin Resources (BEN) reports preliminary AUM $722.4B as of August 31, down from $733.7B at July 31, 2018. The decrease in assets under management was attributable to net market declines and net outflows.

· Cohen & Steers, Inc. (CNS) preliminary assets under management of $61.3B as of August 31, 2018, an increase of $774M from July 31, 2018; the increase was due to market appreciation of $910 million and net inflows of $71 million, offset by distributions of $207 million.

· Annaly Capital (NLY) files to sell 75M shares of common stock

· Cadence Bancorp (CADE) files to sell 12.1M shares of Class A common stock

· First Republic (FRC) files to sell 2M shares of common stock

· Americold Realty Trust (COLD) announces offering of 31M common shares

Healthcare

· WellCare Health Plans Inc. (WCG) will be added to the S&P 500 index on Monday, replacing XL Group Ltd. (XL), which is being acquired by AXA SA

· Gilead Sciences (GILD) shares rose 3% and Galapagos NV (GLPG) up 16% as announced that FINCH 2, a global, randomized, placebo-controlled, Phase 3 study of filgotinib in adults with moderately-to-severely active rheumatoid arthritis achieved its primary endpoint

· Endocyte (ECYT) 9.459M share Secondary priced at $18.50

· Nuvectra (NVTR) 28.25M share Spot Secondary priced at $21.25

· Pacific Biosciences (PACB) 14.118M share Secondary priced at $4.25

· Bristol-Myers (BMY) announced results from a Phase 2 study of BMS-986165, an investigational oral, selective tyrosine kinase 2 inhibitor, in patients with moderate to severe plaque psoriasis. Efficacy endpoints including greater than or equal to75% and 90% reduction in the Psoriasis Area

· Biohaven Pharmaceutical (BHVN) said it has submitted an Investigational New Drug application to the U.S. Food and Drug Administration to evaluate the safety and tolerability of BHV-3500

· Vital Therapies (VTL) said VTL-308 study for ELAD, a cell-based therapy for treating acute forms of liver failure, failed to meet primary and secondary endpoints of improvement in survival through at least 91 days

· Streamline Health (STRM) Q2 EPS loss (8c)/$5.3M vs. est. loss (3c)/$5.41M; backlog at the end of Q2 $23.4M

Industrials & Materials

· Southwest Airlines (LUV) cuts Q3 capacity view to 3.5%-4% from 4.5%-5% citing cancellation of almost 2,000 flights in July and August due to thunderstorms and weather-related disruptions; also sees 3Q RASM up 1%-1.5% y/y, vs. prior view down 1% – up 1%

· Wabco (WBC) said it sees FY EPS guidance in lower half of $7.10-$7.40 view on geopolitical climate saying the “recent intensification of geopolitical dynamics” is negatively impacting markets and currencies in some of WABCO’s regions; now expects truck & bus production in China will deteriorate by about 30% in 2H and 11% on FY basis

Technology, Media & Telecom

· Late Tuesday, the Federal Communications Commission paused its informal 180-day clock for reviewing T-Mobile US. Inc.’s (TMUS) takeover of Sprint Corp. (S), saying it needs more time to consider information the wireless carriers have provided.

· Verizon Communications Inc. (VZ) said it plans to offer the next generation of wireless technology to customers beginning in October. Verizon said it will offer fifth-generation wireless, or 5G, service in Houston, Indianapolis, Los Angeles and Sacramento, Calif. on October 1, with online ordering beginning on Thursday.

· Semi’s: Advanced Micro (AMD) closed above $30 for the first time in 12-years on Tuesday while Intel (INTC)closed at the lows falling 3% on Tuesday posting its 6th straight session decline (lowest levels since February)

· Nielsen (NLSN) said it expands strategic review to include whether to continue as a independent public company

· Micron Technology (MU) downgraded to Neutral from Buy and lowered his price target for the shares to $50 from $68 at Goldman Sachs

· NXP Semiconductors (NXPI) sees annualized revenue growth in FY18-21 at 5%-7%; at its Analyst Day the company forecast Auto segment growth at 7%-10%, Industrial/IoT growth at 8%-11%, Mobile growth 4%-6%, Comms and Infrastructure growth of 0%-2%. Sees gross margin 53%-57% and operating margin at 31%-34%

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