Good morning. Happy Friday. Happy Employment Numbers Day.
The Asian/Pacific markets closed mostly down. New Zealand did well, but Hong Kong, South Korea, Taiwan and Singapore were weak. Europe, Africa and the Middle East are currently mostly down. Finland and Israel are doing well, but Denmark, Poland, Turkey, Germany, Russia, Greece, South Africa, Norway, the Netherlands, Belgium, Sweden, Saudi Arabia and the Czech Republic are down. Futures in the States point towards a down open for the cash market.
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The dollar is up. Oil and copper are down. Gold is up; silver is down. Bonds are up.
Here are the employment figures.
unemployment rate: 3.6% (from 3.5%)
nonfarm payrolls: +225K
private payrolls: +150K
average workweek: flat at 34.3 hours
hourly wages: up 7 cents to $28.44
labor participation rate: unchanged at 63.4%
November jobs revised up by 5K to 261K.
December jobs revised up by 2K to 147K.
Stories/News from Seeking Alpha…
Climbing to all-time highs in the previous session on China’s decision to halve tariffs on a slew of U.S. products, U.S. stock index futures slipped 0.4% overnight following a four-day winning streak on Wall Street. The big news today is January’s jobs report, which will likely show a net increase of 160,000 jobs and for the unemployment rate to stay flat at 3.5%. Wage data will also be closely watched for any signs of potential inflation pressures, which could then translate into a fuller response from the Federal Reserve. For longer-term context, keep an eye on revisions to employment in the 12 months through March 2019, when the trade war with China was in full force.
Economic impacts of coronavirus
Due to the ongoing coronavirus outbreak, China has delayed trade figures for January and said it would combine the data with next month’s release. The epidemic has also led to growth forecasts being cut, with S&P Global Ratings revising its estimation of China’s GDP growth for 2020 from 5.7% before the outbreak to 5%. “Coronavirus will have a larger negative effect on the global economy than the SARS outbreak,” added IHS Markit, explaining that China accounted for 4.2% of the global economy in 2003 vs. 16.3% of the world’s GDP today.
Thiam gets the boot at Credit Suisse
Pressure over a widening spying scandal has weighed over Credit Suisse (NYSE:CS) for months, denting the bank’s reputation and prompting difficult questions about the culture at the top of the firm. Looking to move past the damaging period, CEO Tidjane Thiam has announced his resignation despite being cleared in an internal probe and receiving the backing of key shareholders. He’ll be replaced by Thomas Gottstein, a 20-year veteran of the bank who leads the Swiss unit.
Starlink IPO
SpaceX (SPACE) is likely to spin off its satellite-based broadband business and pursue an IPO, according to COO Gwynne Shotwell. The company has been launching Starlink satellites in batches of 60 since May (there’s currently 240 orbiting Earth) and aims to make its broadband internet service operational by the end of 2020. Last year, Morgan Stanley set a bull case valuation of $120B on SpaceX (Starlink satellite and rocket business), which could also give a boost to Virgin Galactic (NYSE:SPCE).
Casper the Friendly IPO?
After slashing its IPO share price to $12 (from an original range of $17 to $19), Casper (CSPR) climbed 13% yesterday to finish the session at $13.50 (with a market cap of $575M). The online mattress startup had been valued at $1.1B by private investors last year, but that was before the five-year-old company revealed in January that it lost $67M on $312M in revenue in the first nine months of 2019. Casper’s lower IPO valuation was just a moment in time, said CEO Philip Krim, adding that, “our business is not what investors are used to seeing at this scale.”
OPEC+ consensus
Russia is supporting a recommendation to deepen OPEC+ oil supply curbs amid falling demand for crude as China battles a coronavirus outbreak. The proposal could lead to a provisional cut in output of 600,000 barrels per day, which is about 0.6% of global supply and would extend current curbs of 1.7M bpd. It would also pave the way for OPEC to bring forward to February a ministerial policy meeting planned for early March to formalize the decision.
Risk of recession returns to Germany
The manufacturing slump continues in Germany as industrial production fell by 3.5% M/M in December, a day after factory orders were shown to have declined at the fastest pace in more than a decade. That suggests Europe’s largest economy may have contracted at the end of 2019. Germany has already been pummeled by trade tensions, Brexit and climate change regulation engulfing its auto industry, and the latest data will likely dampen budding optimism of a recovery.
Ride-hailing to profitability
Uber’s (NYSE:UBER) stock rose 6% in extended trading on Thursday after announcing a fourth-quarter loss that was narrower than analysts had expected. The firm also moved its EBITDA profitability target to Q4 2020, ahead of its original promise of profitability in 2021. “2020 is going to be the year of subscriptions at Uber,” added CEO Dara Khosrowshahi, noting that when a user tries at least two different company services, like ridesharing and food delivery, they triple their overall usage of Uber.
Countering Huawei dominance
The U.S. should neutralize a threat of Huawei’s next-generation equipment by taking a controlling stake in Nokia (NYSE:NOK) or Ericsson (NASDAQ:ERIC), according to U.S. Attorney General William Barr. “There are only two companies that can compete with Huawei right now… putting our large market and financial muscle behind one or both of these firms would make it a more formidable competitor.” The stance is dismissive of recent White House efforts to blunt Huawei’s threat by investing in homegrown 5G equipment – signaling a split between government approaches.
Got streaming?
ViacomCBS (NASDAQ:VIAC) is taking steps to make programming across the media company’s properties available through one video-streaming offering, CNBC reports. Plans aren’t final, but the new, bigger service might offer not only what’s part of CBS All Access, but also (with the merger complete) Viacom assets such as Paramount films and its TV networks (Nickelodeon, Comedy Central, MTV, BET and Pluto TV). The service would come in an ad-free version, along with a premium paid version that would include Showtime.
What else is happening…
eBay (NASDAQ:EBAY) slides after Intercontinental Exchange (NYSE:ICE) backs away.
Warner Bros. (NYSE:T) finalizes a Friends reunion special.
Match (NASDAQ:MTCH) approaches Meet (NASDAQ:MEET) with takeover offer – Bloomberg.
Jury orders Johnson & Johnson (NYSE:JNJ) to pay $750M in talc case.
Transformation sees Aurora Cannabis (NYSE:ACB) CEO step down.
Warner Music Group files for initial public offering.
Google (GOOG, GOOGL) is tripling its Canadian workforce.
Elliott Management builds $2.5B stake in SoftBank (OTCPK:SFTBY).
Thursday’s Key Earnings
Activision Blizzard (NASDAQ:ATVI) +2.4% AH on robust holiday quarter.
Bristol-Myers (NYSE:BMY) +2.3% topping estimates.
Pinterest (NYSE:PINS) +17% AH amid Q4 user metric beats.
Philip Morris (NYSE:PM) +2.7% beating expectations.
Regeneron (NASDAQ:REGN) +4.8% on strong Q4 results.
Uber (UBER) +5.6% AH guiding earlier EBITDA profitability.
T-Mobile (NASDAQ:TMUS) +1% AH adding 1M phone subscribers.
Twitter (NYSE:TWTR) +15% on strong user growth.
Wynn Resorts (NASDAQ:WYNN) -1.6% AH following an EBITDA miss.
Today’s Economic Calendar
8:30 Non-farm payrolls
10:00 Wholesale Trade
1:00 PM Baker-Hughes Rig Count
3:00 PM Consumer Credit
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Good morning. Happy Thursday.
The Asian/Pacific markets posted big gains. Japan, China, Hong Kong, South Korea, Taiwan, Australia, Malaysia and the Philippines all posted big gains. Europe, Africa and the Middle East are currently doing very well. France, Turkey, Germany, Finland, Hungary, Spain, the Netherlands, Italy and Belgium are leading. Futures in the States point towards a moderate gap up open for the cash market.
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The dollar is flat. Oil is flat; copper is up. Gold and silver are up. Bonds are up.
Stories/News from Seeking Alpha…
Fresh records on Wall Street are set to continue after China said it would halve tariffs on $75B of U.S. imports as part of its efforts to implement a recently signed ‘phase one’ trade deal. The announcement adds to hopes the global economy may be able to avoid a major shock from China’s rapidly spreading coronavirus, with DJIA futures pointing to opening gains of 115 points after soaring nearly 500 points on Wednesday. The march upward wasn’t limited to the U.S., with European indices flashing green following big gains during the overnight session in Asia.
Next round of notable earnings
Twitter (NYSE:TWTR) will report results before the opening bell, and analysts are expecting higher user engagement to drive a rebound from an earnings miss in Q3. After the bell, Uber (NYSE:UBER) is expected to add to its staggering losses, though investors will be looking for updates to the loss-making company’s path to profitability. Helped by promotional plans, T-Mobile (NASDAQ:TMUS) is likely to post a rise in fourth-quarter revenue, and will likely comment on its 5G expansion and impending merger with Sprint (NYSE:S).
Sleepy IPO from mattress firm Casper
Planning to list on the NYSE today under ticker “CSPR,” Casper has priced its initial public stock offering at $12 a share, down from an earlier range of $17 to $19. That values the company at around $500M, down from the $705M it valued itself at last week, and a significant hit for the mattress company that once prided itself as a unicorn. “The days of growth at any cost are over,” said Santosh Rao, who researches IPOs for Manhattan Venture Research. “You either have to be profitable, or take a haircut.”
OPEC+ technical meeting drags on
A technical committee of OPEC+ has added a third day of meetings after failing to reach a recommendation on an emergency summit of oil ministers. Delegates are split over the threat the coronavirus poses to global consumption, with Saudi Arabia pushing for immediate and deeper output cuts to the opposition of Russia, whose budget is more resilient to lower crude prices. Oil is already down sharply from this year’s high, falling into a bear market last week.
Central bank digital currencies
Central banks are hurrying the pace at which they are looking at issuing their own digital currencies (known as CBDCs), as Facebook’s (NASDAQ:FB) push to launch its own crypto raises questions over who will control money supply in the decades ahead. “The Fed is conducting research and experimentation related to distributed ledger technologies and their potential use case for digital currencies, including the potential for a CBDC,” Governor Lael Brainard told the Stanford Graduate School of Business. Leaders of six major central banks, including the U.K., the eurozone, Japan, Canada, Sweden and Switzerland, are also undertaking joint research on cryptos and may hold their first meeting in Washington in mid-April.
HSBC holds off on naming permanent CEO
Investors in HSBC (NYSE:HSBC) will have to wait even longer for the bank to name its next permanent chief executive, FT reports. Expectations were high that interim CEO Noel Quinn or an external candidate would be appointed to the position before a sweeping shakeup was unveiled on Feb. 18, when the lender reports full-year results. The plan would reshape the company dramatically and involve at least 10,000 layoffs and shrinking HSBC’s investment bank.
7-Eleven pilots first cashierless store
Stepping up its innovation, 7-Eleven (OTCPK:SVNDY) is testing out a pilot cashierless store at its corporate headquarters in Texas. It uses a dedicated app and “proprietary mixture of algorithms and predictive technology” to know what each customer is buying. Sound familiar? Amazon (NASDAQ:AMZN) has been testing a similar concept at its Go stores since 2018. “Retail technology is evolving at a rapid pace and customer expectations are driving the evolution,” said 7-Eleven CEO Joe DePinto.
Alphafly will also avoid Olympic ban
New restrictions introduced last week by governing body World Athletics – sole thickness of no more than 40mm and inclusion of carbon fiber as long as it’s on one continuous plane – didn’t just spare Nike’s (NYSE:NKE) controversial Vaporfly sneakers from a ban. The company’s Air Zoom Alphafly NEXT%, a prototype of which Eliud Kipchoge wore in October to run a marathon in less than two hours, also falls within the new requirements. That may mean a surge in sales for the sneaker giant ahead of the Tokyo Olympic Games.
Huawei initiates legal action against Verizon
In a move likely to further inflame tensions between the Chinese company and Washington, Huawei Technologies has filed a lawsuit against Verizon (NYSE:VZ), alleging the U.S. carrier used 12 of its patents without authorization. At issue are areas that include optical transmission and digital communications, but not next-generation 5G technology. “Huawei is simply asking that Verizon respect Huawei’s investment in research and development by either paying for the use of our patents, or refraining from using them in its products and services,” read a statement from the company.
Google under fire
Breaking up Alphabet (GOOG, GOOGL) is still on the table in the multi-state Google antitrust probe. “I’m literally open to doing what works. I would look at any remedy as a possible solution,” Texas Attorney General Ken Paxton declared. “I want this to benefit the most number of consumers.” Reports suggest the DOJ has also reached out to more than a dozen companies in its antitrust probe, including publishers and advertising agencies, as Google’s online ad tools become a major focus of the investigation.
What else is happening…
Six-day, 60% rally in Tesla (NASDAQ:TSLA) comes to an end.
Uber (UBER) receives autonomous testing permit in California.
LinkedIn (NASDAQ:MSFT) CEO Weiner steps down after 11 years.
EU probes Qualcomm (NASDAQ:QCOM) over radio-frequency chips.
JPMorgan (NYSE:JPM) under the microscope for metals spoofing.
Wednesday’s Key Earnings
General Motors (NYSE:GM) +1.9% squeezing out profits despite strike.
GoPro (NASDAQ:GPRO) -14.5% AH following an earnings dud.
Merck & Co. (NYSE:MRK) -2.9% spinning off women’s health and biosimilar drugs.
Peloton (NASDAQ:PTON) -9.2% AH on disappointing guidance.
Qualcomm (QCOM) -2% AH warning about coronavirus ‘uncertainty.’
Spotify (NYSE:SPOT) -4.7% after misses, operating losses.
Twilio (NYSE:TWLO) -5.9% AH forecasting losses.
Today’s Economic Calendar
7:30 Challenger Job-Cut Report
8:30 Initial Jobless Claims
8:30 Productivity and Costs
9:15 PM Fed’s Kaplan: “2020 Business Outlook: Real Estate and the Texas Economy”
10:30 EIA Natural Gas Inventory
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
7:15 PM Fed’s Quarles: Monetary Policy and Economic Outlook
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Good morning. Happy Wednesday.
The Asian/Pacific markets posted solid gains. Japan, China, Hong Kong, India, New Zealand, Indonesia, Singapore, Thailand and the Philippines all did very well. Europe, Africa and the Middle East are currently doing great. Denmark, Poland, France, Germany, Russia, South Africa, Finland, Switzerland, Norway, Spain, the Netherlands, Italy, Israel, Belgium, Austria and Sweden are up more than 1%. Futures in the States point towards another relatively big gap up open for the cash market.
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The dollar is up. Oil and copper are up. Gold and silver are up small amounts. Bonds are down.
Stories/News from Seeking Alpha…
Disney made a strong entrance into the streaming video wars, reaching 28.6M paying subscribers on Disney+ just three months after its launch. It took Netflix (NASDAQ:NFLX), the largest streaming platform, years to reach that number, though it currently has more than 67M subs across the U.S. and Canada. Other highlights… Revenue and profit at Disney’s (NYSE:DIS) film division more than doubled Y/Y to $3.7B, though coronavirus-related closings at its theme parks in Shanghai and Hong Kong could shave $175M off operating income if they extend for two months. The Mandalorian will also return in October, if you were wondering. DIS +0.5% premarket.
Dow 29,000
Down for most of the night, U.S. stock futures are now indicating another big day of gains, with the DJIA pointing to an advance of 272 points at the open to retake the 29,000 level. Scientific progress toward a coronavirus cure is being cited as a catalyst for the latest movement, with reports suggesting researchers at Zhejiang University had zeroed in on two drugs to successfully fight the disease, as well as progress in the U.K. on creating a vaccine. President Trump also touted “the great American comeback” in his third SOTU address, while we’ll get payroll data from ADP and more earnings later in the session.
Another round of Macy’s closings
Updating its guidance for Q4 and the years ahead, Macy’s (NYSE:M) plans to close 125 department stores over the next three years, in an admission that a fifth of its locations cannot succeed as shoppers move online. The retailer is also cutting 2,000 corporate jobs, and abandoning a dual headquarters in Cincinnati for a head office in New York. Macy’s will additionally test a new concept that will take it out of traditional malls by opening smaller outlets in strip malls, and will continue to look for profits from its real estate.
Not a good sign for the vaping industry
Tobacco giant Imperial Brands (OTCQX:IMBBY) has abandoned its forecast for growth this year as a U.S. ban on some vaping flavors leads to a drop in sales of smoking alternatives. Demand for the products has also been dented by adverse news flow and safety concerns following a spate of illness in the U.S. Meanwhile, the CEOs of Juul (JUUL), Reynolds American (NYSE:BTI) and NJOY are set to be grilled about rising youth vaping rates by House lawmakers today, the first hearing since the Trump administration announced a limited ban on vaping flavors.
Vote on new Tesla Gigafactory
“Giga Texas?” Tesla’s (NASDAQ:TSLA) Elon Musk tweeted overnight, giving two options – “Hell yeah” or “Nope” in a survey set to last 24 hours. The poll garnered over 160,000 responses as of 6:30 a.m. ET, with nearly 80% voting in favor of the new gigafactory. Tesla, whose shares have been on a major tear and yesterday topped $900, currently has two gigafactories in the U.S. and one in Shanghai. In November, it also announced plans to build its first European factory and design center near Berlin.
Latest fight against deepfakes
As tech platforms prepare for the 2020 presidential election, Twitter (NYSE:TWTR) said it will begin labeling tweets containing synthetic or deceptively edited forms of content and will remove any manipulated media “likely to cause harm.” Earlier this week, YouTube (GOOG, GOOGL) announced it would remove any content that has been doctored and may pose a “serious risk of egregious harm,” while TikTok issued a broad ban on “misleading information.” Facebook (NASDAQ:FB) is further removing deepfakes and some other manipulated videos from its websites, but will leave up satirical content.
Bezos sells $1.8B worth of Amazon stock
Over the past week, Jeff Bezos has sold 905,456 shares in Amazon (NASDAQ:AMZN) for more than $1.8B, according to financial filings. The disclosure comes as the company’s market cap vaulted over the $1T level following a robust set of Q4 results that displayed AWS strength and brushed off concerns about the cost of one-day Prime delivery. While it’s unclear exactly where the money is going, in the past Bezos has said he would sell at least $1B of Amazon stock a year to fund his rocket startup, Blue Origin (BORGN).
NYSE owner said to be stalking eBay
Shares of eBay surged nearly 9% late Tuesday after the WSJ reported that Intercontinental Exchange (NYSE:ICE) made a bid to acquire its marketplace business. The deal could value eBay at roughly $30B. Earlier on Tuesday, hedge fund Starboard Value called for eBay to sell its classifieds division, saying it would allow the company to focus on its growing marketplace unit. eBay has attracted multiple activist investors in recent years including Carl Icahn, who pushed for its 2015 spinoff of PayPal (NASDAQ:PYPL).
What else is happening…
Coronavirus breakout on Carnival (NYSE:CCL) ship quarantined in Japan.
Best Buy (NYSE:BBY) board backs CEO after misconduct probe.
Tiffany (NYSE:TIF) shareholders approve LVMH (OTCPK:LVMHF) bid.
Boeing (NYSE:BA) won’t cancel CEO incentive tied to MAX return.
Tilray (NASDAQ:TLRY) cuts 10% of workforce to reduce costs.
Pretty penny to remove Huawei systems from ‘core’ networks.
Wednesday’s Key Earnings
Chipotle (NYSE:CMG) +1.4% with sizzling comparable sales.
ConocoPhillips (NYSE:COP) -4.5% on EPS miss, boosting buyback.
Cummins (NYSE:CMI) -1.2% amid a decline in key markets.
Disney (DIS) +0.5% AH on strong start to Disney+.
Emerson Electric (NYSE:EMR) +0.9% raising outlook despite ‘challenging 2020.’
Ford (NYSE:F) -9.6% AH reporting a $1.7B quarterly loss.
Gilead Sciences (NASDAQ:GILD) -1.3% AH missing EPS estimates.
Match Group (NASDAQ:MTCH) -8.4% AH as Tinder sub growth slowed.
McKesson (NYSE:MCK) +3.7% topping expectations.
Simon Property (NYSE:SPG) +3.4% posting Q4 FFO beats.
Sirius XM (NASDAQ:SIRI) +0.6% reporting upside Q4 revenue.
Snap (NYSE:SNAP) -10.5% AH as a turnaround hit a speed bump.
Sony (NYSE:SNE) +3.6% on strong smartphone image sensor sales.
Today’s Economic Calendar
7:00 MBA Mortgage Applications
8:15 ADP Jobs Report
8:30 International Trade
8:30 Treasury Refunding Quarterly Announcement
9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
10:30 EIA Petroleum Inventories
4:10 PM Fed’s Brainard: “Payment Innovation”
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Good morning. Happy Tuesday.
The Asian/Pacific markets posted solid gains. China, Hong Kong, South Korea, India, Taiwan, Indonesia, Singapore, Thailand and the Philippines all gained more than 1%. Europe, Africa and the Middle East are currently up big. The UK, Poland, France, Germany, Greece, Turkey, Russia, South Africa, Hungary, Spain, the Netherlands, Italy, Belgium, Israel and Sweden are up more than 1%. Futures in the States point towards a big gap up for the cash market.
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FREE Online Course: Jason Leavitt’s Mini Masterclass in Trading
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The dollar is up. Oil and copper are up. Gold is down; silver is flat. Bonds are down.
Stories/News from Seeking Alpha…
U.S. stocks are on the way up for a second consecutive session, with Dow futures pointing to an advance of 315 points at the open, amid big overnight gains in Europe and Asia. U.S. equities rallied yesterday on manufacturing activity strength in January, while the PBOC just plowed another 500B yuan ($71.2B) of liquidity via reverse repo agreements into the financial system, adding to the $143B injection seen Monday. A second coronavirus death outside mainland China – in neighboring Hong Kong – has kept concerns about the spread of the disease elevated, but so far the international rate of increase has slowed from late last week.
Macau shuts casinos
Macau gambling shares fell after the territory ordered casinos to suspend operations for two weeks as a local employee was confirmed to have the virus. The entire region had already nearly been closed for travel, depriving the struggling area of tourists and high rollers. Even before the announcement, gamblers have been staying away from Macau’s casinos, which saw gambling revenue drop to $2.76B in January, down more than 11% compared with a year earlier. WYNN -3.5%; MGM -3.2% premarket.
Google unveils YouTube, Cloud results
Financial analysts applauded transparency from Alphabet (GOOG, GOOGL) yesterday, which revealed new revenue figures for the first time. Sales at YouTube were $15.1B for the year, lower than projections, while Google Cloud revenue jumped 53% to $2.6B, but trailed that of Microsoft’s (NASDAQ:MSFT) Azure platform (profit figures were not disclosed). The news, along with mixed fourth-quarter results, sent down Alphabet shares down 4% AH.
Is Tesla behaving like Bitcoin 2017?
Tesla (NASDAQ:TSLA) is rallying for a sixth day, with shares up another 4% premarket to over $800, following yesterday’s incredible run that saw the stock skyrocket 20%. The latest? Panasonic (OTCPK:PCRFF) said its business turned profitable in Q4 as Tesla’s battery output helped push that division into the black, while Argus and Ark Invest issued some bullish predictions. TSLA has now climbed 79% in just 2020 alone, and has tripled in value since Q3 results were reported in October.
BP boosts dividend
BP (NYSE:BP) +4.8% premarket after raising its dividend by 2.4% to 10.5 cents per share, marking a sign of confidence in its growing oil and gas business on the last day in office for CEO Bob Dudley (he’s been at the helm for nearly a decade). “BP is performing well, with safe and reliable operations, continued strategic progress and strong cash delivery,” he added in a statement. Oil price weakness and a “weaker environment” still weighed on results, with full-year underlying replacement cost profit, used as a proxy for net profit, falling 21% Y/Y to $10B in 2019.
Watch out for Disney earnings
It’s a pivotal quarter for the company as investors focus on early returns from Disney+. Shares bounced in November as the entertainment giant attracted 10M subscribers following launching the streaming service in the U.S. and two other countries, but the stock has since given back some of those gains. Other concerns center on the coronavirus. Disney (NYSE:DIS) shuttered its Shanghai theme park indefinitely on Jan. 25, and theaters may remain closed in the region due to the outbreak. DIS +1.8% premarket.
Antitrust head recuses himself from Google probe
Makan Delrahim, the head of the antitrust division at the Justice Department, has recused himself from investigating Google (GOOG, GOOGL), sources told the NYT. At issue are potential conflicts of interest related to his past work for the internet search company, but what’s unclear is why the recusal is taking place now (the DOJ has been investigating Google for months). Department officials are set to meet with state AG representatives today to discuss the probe, focusing on search bias, ads, and the Android OS.
‘Hamilton’ coming to the big screen
Disney (DIS) will bring Hamilton to cinemas in North America starting in 2021 after the blockbuster Broadway musical finishes its traditional theatrical run. The movie will be a recording of the show made in 2016 instead of a film adaptation of the musical, and will feature the original Broadway cast, including writer/composer Lin-Manuel Miranda in the title role. The Mouse House paid an eye-popping $75M for the rights to the show, which continues to command hefty ticket prices and draw large audiences.
Greater clarity on how to join the EU
As the U.K. divorces itself from the bloc, Brussels has set out plans to streamline the EU enlargement process and give member states stronger powers to halt or reverse accession talks, FT reports. The decision was prompted by French opposition to North Macedonia and Albania from opening negotiations, saying the countries had not made sufficient progress with reforms to cut corruption and strengthen the rule of law. Under the new plan, backsliding or delays could lead to discussions being put on hold or suspended, though it promises improved incentives for well-performing aspirant countries.
What else is happening…
Super Bowl LIV drew 102M viewers on Fox (NASDAQ:FOX) channels.
Dropbox (NASDAQ:DBX) CEO joins Facebook’s (NASDAQ:FB) board.
AT&T (NYSE:T) walks away from Yankees sponsorship.
Trump administration tariff exemptions slump 91%.
State takeover of PG&E (NYSE:PCG) outlined in new bill.
Saudis seek short-term OPEC production cut – WSJ.
Peloton (NASDAQ:PTON) settles bike tech dispute with Flywheel.
Monday’s Key Earnings
Alphabet (NASDAQ:GOOG) -4.1% AH posting revenue miss, new numbers.
NXP Semiconductors (NASDAQ:NXPI) -2% AH despite beats, upside outlook.
Sysco (NYSE:SYY) -6.7% coming up short on revenue.
Today’s Economic Calendar
Auto Sales
8:55 Redbook Chain Store Sales
10:00 Factory Orders
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Good morning. Happy Monday. Hope you had a good weekend.
The Asian/Pacific markets closed mostly down. China, which had been closed, fell 8%. Japan, Malaysia, Singapore, Thailand and the Philippines were also weak. Europe, Africa and the Middle East are mixed. The UK, France, Italy, Israel and the Czech Republic are up; Greece, Portugal and Saudi Arabia are down. Futures in the States point towards a moderate gap up open for the cash market.
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FREE Online Course: Jason Leavitt’s Mini Masterclass in Trading
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The dollar is up. Oil is down a small amount; copper is up. Gold and silver are down. Bonds are down.
Stories/News from Seeking Alpha…
Worried by the mounting death toll from the coronavirus and drastic efforts to contain it, investors dashed for the exits as Chinese markets reopened following an extended Lunar New Year break (markets have been closed since Jan. 23). Shanghai plunged 7.7%, Shenzhen tanked 8.5% and the tech-heavy Chinext Composite slumped 6.9%, marking the heaviest loss since August 2015 in the aftermath of the bursting of an equity bubble. Officials tried to head off the panic, but to little avail. The PBOC injected $174B into money markets via reverse repo agreements and cut rates on the funds by 10 basis points, while the China Securities Regulatory Commission told some brokerages that their prop traders weren’t allowed to be net sellers of equities this week and brokerages were only allowed to sell to meet redemptions.
Two-thirds of China’s economy remains closed
More than a dozen Chinese provinces have announced an extension of the current Lunar New Year holiday by more than a week as the nation attempts to halt the rapidly spreading coronavirus that has so far claimed 362 lives, all but one in China. The areas accounted for almost 69% of China’s gross domestic product in 2019, according to Bloomberg. Economists now expect that this virus will deal a more severe blow to the economy in the near term than the SARS epidemic, which subtracted an estimated 0.8 percentage point from GDP growth in 2003.
Airlines rush to enforce travel restrictions
New U.S. travel restrictions aimed at combating the spread of the coronavirus took effect on Sunday afternoon, leaving airline employees across the globe scrambling to enforce them. While the three major U.S. carriers – American (NASDAQ:AAL), Delta (NYSE:DAL) and United (NASDAQ:UAL) – have suspended direct flights to China, the TSA has instructed airlines with flights to the U.S. from other countries to screen passengers before boarding to find out whether they’ve been in China recently. Check-in and gate agents are also required to question travelers, look through recent reservations and possibly their passports for entry or exit stamps, and must work with U.S. Customs and Border Protection to make determinations.
Coronavirus treatment testing
Shares of Gilead Sciences (NASDAQ:GILD) are up 12% premarket after formalizing an agreement with Chinese authorities to study the effectiveness of an experimental Ebola and SARS treatment on patients infected with the coronavirus. “While there are no antiviral data for remdesivir that show activity against 2019-nCoV at this time, available data in other coronaviruses give us hope,” the company said in a statement. Trials for the drug will be conducted in Wuhan, the central Chinese city that is ground zero for the current outbreak.
Next FAANG (or FAAAM) to report
Get ready for Alphabet’s (GOOG, GOOGL) first quarterly report since Sundar Pichai, who had been CEO of Google, took the reins of the parent company (founders Larry Page and Sergey Brin stepped back from day-to-day management in December). Wall Street analysts project fourth-quarter revenue of $46.87B (+19.3% Y/Y), with profits of $12.76 per share (-0.1% Y/Y). Investors are also hoping the tech titan will provide more detailed disclosure around its business lines, Google Cloud and antitrust scrutiny, as well as find a way to scale back losses on non-core “other bets.”
OPEC+ weighs response as oil slides towards bear market
With crude trading near $51 a barrel – after a slump of about 16% in January – OPEC and its allies are considering calling an emergency meeting. Potential dates being discussed are Feb. 8-9 and Feb. 14-15, though for now the next regular meeting on March 5-6 remains on schedule. OPEC, meanwhile, is holding a meeting of technical representatives – the Joint Technical Committee – on Tuesday and Wednesday to assess the coronavirus’s effect on markets and demand, according to delegates.
Johnson’s trade vision
“I hope you’ve got the message by now, we’ve made a choice, we want a comprehensive free trade agreement, similar to Canada’s,” Boris Johnson said in his first speech on Brexit since the U.K. left the EU on Friday. “There is no need for a free trade agreement to involve accepting EU rules… any more than the EU should be obliged to accept U.K. rules.” Ahead of the speech, EU Brexit negotiator Michel Barnier set out battle lines for the bloc’s post-Brexit trade negotiations, including measures to ensure competition remains open and fair, and an agreement on fisheries with “reciprocal access.” Sterling -1% to $1.3066.
Forever no longer
Four months after filing for Chapter 11 bankruptcy, Forever 21 has reached a deal to sell off its assets for $81M, a fraction of what the international fashion pioneer was once worth. As part of the deal, Forever 21, which has struggled in the online age, would be sold to a consortium made up of mall operators Simon Property Group (NYSE:SPG) and Brookfield Properties (NASDAQ:BPY), and brand management firm Authentic Brands. The group has been designated as the “stalking horse bidder,” meaning the deal remains subject to approval by a judge and other potential buyers have until Feb. 7 to place bids for the company.
New leadership at WeWork
WeWork (WE) is looking to turn over a new leaf by naming real estate industry veteran Sandeep Mathrani as its new chief executive. It’s a critical step in the company’s bid to rebuild its image following a failed IPO attempt last year that saw the departure of co-founder and former CEO Adam Neumann, a subsequent bailout by major stakeholder Softbank (OTCPK:SFTBY), and steep plunge in valuation to less than $8B (from $47B). Mathrani currently serves as CEO of Brookfield Property Partners’ (BPY) retail group, and prior to that he was an executive at real estate firms including Vornado Realty Trust (NYSE:VNO).
What else is happening…
Exxon (NYSE:XOM) falls 1% premarket on Goldman downgrade.
Uber (NYSE:UBER) marks first exit in Latin America.
Wiring is latest hurdle for 737 MAX (NYSE:BA) return.
Toyota (NYSE:TM) gets serious on EV battery development.
Third person dies from Chesapeake (NYSE:CHK) well blast.
California’s PG&E (NYSE:PCG) proposes board revamp.
Macau casino revenue plunges in January.
Today’s Economic Calendar
9:45 PMI Manufacturing Index
10:00 ISM Manufacturing Index
10:00 Construction Spending
4:30 PM Fed’s Bostic Speech