He once visited The Virgin Islands... they are now called The Islands
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
$MSOS
JUSTICE DEPT. TO POST MARIJUANA RECLASSIFICATION PLAN: POLITICO
DOJ FILES NOTICE OF PROPOSED RULE TO RESCHEDULE CANNABIS
DEA HASN'T YET MADE DETERMINATION ON CANNABIS SCHEDULING
iQiyi call volume above normal and directionally bullish
Bullish option flow detected in iQiyi with 11,348 calls trading, 2x expected, and implied vol increasing almost 5 points to 61.82%. Jun-24 5 calls and May-24 5 calls are the most active options, with total volume in those strikes near 6,300 contracts. The Put/Call Ratio is 0.56. Earnings are expected on May 16th.
he Department of Justice plans to issue a notice of proposed rulemaking that would reclassify marijuana to a less restrictive category, marking the next step in the rescheduling process begun by President Joe Biden in October 2022, two Biden administration officials familiar with the decision told Politico's Natalie Fertig and Adam Cancryn. Publicly traded companies in the cannabis space include Aurora Cannabis (ACB), CV Sciences (CVSI), Canopy Growth (CGC), Cronos Group (CRON), Goodness Growth (GDNSF), Green Thumb Industries (GTBIF), IGC Pharma (IGC), Tilray (TLRY), Trees Corporation (CANN) and Trulieve Cannabis (TCNNF).
First Solar remains key beneficiary of new content guidance, says Roth MKM
Roth MKM analyst Philip Shen says the Department of Treasury earlier today released updated domestic content guidance, including the imminent removal of the 201 bifacial exemption. The bottom line is that Roth continues to expect U.S. made cells to be practically required to secure the 10% domestic content investment tax credit adder, "likely to the dismay of much of the industry," the analyst tells investors in a research note. Roth believes First Solar (FSLR) remains the key beneficiary in its coverage universe, adding the tracker vendors - Nextracker (NXT), Array Technologies (ARRY) and FTC Solar (FTCI) -likely can't benefit as easily. The firm's initial industry work and checks suggest trackers can't meet the domestic content ITC adder requirements without having a U.S. made cell. It thinks Sunrun (RUN) and Sunnova Energy (NOVA) "appear to be winners as well with storage."
Public Storage price target raised to $289 from $270 at Scotiabank
Scotiabank analyst Nicholas Yulico raised the firm's price target on Public Storage to $289 from $270 and keeps a Sector Perform rating on the shares. Following Q1, the firm remains cautious on the U.S. Self-Storage REITs subsector given its view that housing mobility and home sales need to improve to spur more storage rental demand, which is not expected to occur during this Spring/Summer leasing season, the analyst tells investors.
Traws Pharma reports Q1 EPS (24c) vs. (28c) last year
Reports Q1 revenue $56,000 vs. $56,000 last year. "2024 has already been a transformative year for Traws Pharma to advance our portfolio of novel treatments for serious respiratory infections and oncology programs. We completed the acquisition of Trawsfynydd and concluded a concurrent $14 million private placement financing. In addition, we initiated first-in-human dosing for our COVID 19 product candidate, including completion of the first cohort dosing group. Furthermore, we completed the last dose escalation cohort for our CDK4+ inhibitor, narazaciclib," stated Werner Cautreels, Ph.D., Chief Executive Officer of Traws Pharma. "We believe that we are poised to make even more meaningful progress in the second half of 2024, as we advance our influenza treatment and ritonavir-free protease inhibitor for COVID 19 into expanded Phase 1 dose escalation studies and begin Phase 2 development. Based on the preclinical profile and early clinical data from our infectious disease candidates and narazaciclib, I am optimistic about the outlook for Traws' portfolio and look forward to updating our investors with our progress through the year."
********************************************************
no worries!!!!!!!!!!!!!!!!11
Initial claims fell -10k to 222k
Initial claims fell -10k to 222k in the second week of May from an 8-month high of 232k (was 231k), versus a 16-month low of 194k in mid-January. The initial claims spike at the beginning of May was led by a 10k rise in New York that reflected half of the 20k NSA total claims rise, likely reflecting the start of spring break at New York schools. Analysts saw respective declines in the second week of May of -9k and -13k. Continuing claims rose 13k to a still-tight 1,794k from 1,781k (was 1,785k), versus a 2-year high of 1,829 in late-January. Initial claims are averaging 226k in May, versus lower prior monthly averages of 212k in April, 214k in March, and 209k in February. Analysts expect a 216k May BLS survey week reading that exceeds recent survey week readings of 212k in both March and April and 200k in February. For continuing claims analysts expect a 26k rise between the April and May BLS survey weeks, following a -36k April drop, but gains of 5k in March and 44k in February. The up-tilt for initial and continuing claims into May after a lean path since last summer implies neutral risk for our 190k May nonfarm payroll estimate.
Housing starts rose 5.7% to 1.360 M in April
Housing starts rose 5.7% to 1.360 M in April, weaker than expected pace after downward revisions to the prior months amid annual revisions. March starts plunged -16.8% to 1.287 (was 1.321 M) after February starts climbed 12.4% to 1.546 (was 1.549) M.All of the strength was in multifamily starts which surged 30.6% in April to 0.329 M after slumping -38.8% to 0.252 (was 0.299) M. Single family starts dipped -0.4% to 1.031 M after dropping -8.7% to 1.035k (was 1.022) M in March.Building permits were down -3.0% to 1.440 M in April after sliding -5.0% to 1.485 (was 1.458) M in March
Vladimir Putin has landed in Beijing for a two-day state visit, where he was greeted by Chinese leader Xi Jinping with a red-carpet welcome and a full military band. The trip will build on their commitment to the "no limits" relationship they signed at the Winter Olympics in 2022, just before the full-scale invasion of Ukraine. As Russia becomes isolated from the West on the world stage, it has sought to boost trade in the East and elsewhere, helping prop up its economy in the face of sanctions.
Quote: "Relations between Russia and China are not opportunistic and not directed against anyone," Putin declared. "Our cooperation in international matters is one of the stabilizing factors in the international arena." Xi echoed the sentiment, adding that China will "work together to achieve the development and rejuvenation of our respective countries" and "to uphold equity and justice in the world."
Trade between the two nations has soared to record levels, rising 26% last year to $240B and hitting targets ahead of schedule. Russia has even overtaken Saudi Arabia as China's main oil supplier, while the latter sends back key commodities, vehicles and other consumer goods. Trade has also seen Russia's economy top expectations to expand by 3.6% in 2023, according to the IMF, despite Western efforts aimed at draining the Kremlin's war coffers.
Reaction? Wall Street Breakfast ran a survey last November, and again this week, on how the U.S. should manage its economic relationship with China. The biggest changes over the past six months showed that more subscribers have less faith in rapprochement and trade deals (24% to 15%), while a greater number believe decoupling and sanctions are the way to go (11% to 19%). It's noteworthy as Washington has recently threatened additional sanctions on Chinese banks and entities that handle Russian trade involving dual-use goods that can be used for both civilian and military purposes. How does all of this factor into your investing decisions? Join the discussion in the comments section.
Soft CPI
Thought the Fed was only data dependent? Guess again. Data-centric traders celebrated in style after April's Consumer Price Index increased by 0.3% from March, easing from the +0.4% pace seen in the previous three months. The print, which meant inflation is still running well above the 3% level on an annualized basis, helped push Wall Street indices to new record highs, with the S&P 500 (SP500) crossing 5,300 for the first time ever. Meanwhile, retail sales came in flat, while regional business activity cooled further, suggesting the Fed could ease monetary policy earlier than expected. (119 comments)
Secret stake
It's 13F season, where hedge funds with at least $100M in assets under management reveal their holdings. The flurry of filings sheds light on what they bought and sold during the quarter, but investment managers can also make special requests to regulators to keep some of their stakes confidential. Insurance-focused Berkshire Hathaway (BRK.B) just revealed one of those positions, disclosing a prior $6.7B stake in Chubb (CB), with market participants sending the stock up 8% AH on Wednesday as some looked to copy the successful picks of Warren Buffett. Other 13F highlights include filings from Bill Ackman's Pershing Square, Michael Burry's Scion and David Tepper's Appaloosa. (33 comments)
Battle of the skies
AT&T (T) is teaming up with AST SpaceMobile (ASTS) to bring satellite internet connectivity to cell phones. The news sent ASTS up 36% in premarket trading this morning, with the space-based broadband network deal set to last until 2030. Other telecom operators have also ventured into the market. T-Mobile has a similar deal with SpaceX (SPACE), while Verizon (VZ) previously partnered with Amazon's (AMZN) Project Kuiper for connectivity solutions. Apple (AAPL) has also been offering satellite-to-cellphone emergency services on its iPhones since 2022. (43 comments)
Today's Markets
In Asia, Japan +1.4%. Hong Kong +1.6%. China +0.1%. India +0.9%.
In Europe, at midday, London -0.2%. Paris -0.4%. Frankfurt -0.3%.
Futures at 7:00, Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude -0.2% to $78.49. Gold -0.3% to $2,388.80. Bitcoin +5.4% to $66,165.
Ten-year Treasury Yield unchanged at 4.34%.
Today's Economic Calendar
8:30 Housing Starts and Permits
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
8:30 Import/Export Prices
9:15 Industrial Production
10:00 Fed’s Barr Speech
10:00 Fed's Barkin Speech
10:30 EIA Natural Gas Inventory
10:30 Fed's Harker Speech
12:00 PM Fed's Mester Speech
3:50 PM Fed's Bostic Speech
4:30 PM Fed Balance Sheet
Companies reporting earnings today »
What else is happening...
GameStop (GME), AMC (AMC)? Meme rally is cooling off big time.
First Solar (FSLR) pops after trade probe into Asian solar imports.
Netflix (NFLX) ad plan tops 40M users; NFL deal in the bag.
Microsoft's (MSFT) emissions rise amid surging AI demand.
BOJ rate hike? Trouble as Japan's economy keeps shrinking.
Disney (DIS) flags spending cuts on marketing, traditional TV.
Networking: Cisco (CSCO) raises guidance after latest results.
Morgan Stanley highlights Dell's (DELL) AI server and storage.
China's NIO changing global strategy as U.S., EU tariffs loom.
Check out the latest hot dividend picks by Seeking Alpha analysts.
gooooooooooooood morning bobber
? $WMT RESULTS: Q1
• ADJ EPS $0.60, EST $0.53
• Revenue $161.51B, +6% y/y, EST $159.58B
• Total US comparable sales ex-gas +3.9%, EST +3.42%
• Walmart-only US stores comparable sales ex-gas +3.8%, EST +3.45%
• Sam's Club US comparable sales ex-gas +4.4%, EST +3.33%
• Walmart-only US comparable ticket 0%, EST +1.32% (2 ESTs)
• Walmart-only US comparable transactions +3.8%, EST +3.17%
? GUIDANCE: Q2
• Sees ADJ EPS $0.62 to $0.65, EST $0.64
spy qqq new all time high
Tesla Must Face Claims It Misled Buyers About Autopilot and Self-Driving
goooooooooood morning
Medtronic call volume above normal and directionally bullish
Bullish option flow detected in Medtronic with 5,422 calls trading, 1.6x expected, and implied vol increasing over 2 points to 22.70%. 5/24 weekly 86 calls and May-24 72 puts are the most active options, with total volume in those strikes near 3,800 contracts. The Put/Call Ratio is 0.51. Earnings are expected on May 23rd.
Petco new Executive Chairman 'should be well received by market,' says Baird
After Petco announced the appointment of Glenn Murphy as Executive Chairman of the Board, Baird analyst Peter Benedict said the addition of such a "proven retail executive with an impressive track record to the Board should be well received by the market." The firm's initial reaction to the news is "positive," and it looks forward to learning more about Murphy's plans, but it remains on the sidelines for now given limited visibility into profit stabilization and improvement. Baird keeps a Neutral rating and $2.50 price target on Petco shares.
V F Corp put volume heavy and directionally bearish
Bearish flow noted in V F Corp with 3,970 puts trading, or 1.4x expected. Most active are May-24 12.5 puts and Nov-24 7.5 puts, with total volume in those strikes near 2,800 contracts. The Put/Call Ratio is 2.64, while ATM IV is up over 1 point on the day. Earnings are expected on May 22nd.
Super Micro call volume above normal and directionally bullish
Bullish option flow detected in Super Micro with 48,214 calls trading, 1.7x expected, and implied vol increasing almost 2 points to 64.88%. May-24 900 calls and May-24 850 calls are the most active options, with total volume in those strikes near 10,100 contracts. The Put/Call Ratio is 0.61. Earnings are expected on August 6th.
nice
nflx
Netflix will be the home to live NFL games this Christmas Day
UP AFTER EARNINGS -
Edible Garden (EDBL) up 97%
Monday.com (MNDY) up 20%
Sportradar (SRAD) up 9%
Dynatrace (DT) up 5%
Dole (DOLE) up 3%
Serve Robotics (SERV) up 1%
Arcos Dorados (ARCO) up 1%
Renalytix (RNLX) up 1%
DOWN AFTER EARNINGS -
Palatin (PTN) down 9%
European Wax Center (EWCZ) down 1%
DLocal (DLO) down 31%
Pixelworks (PXLW) down 26%
With inflation staying hot in every reading of 2024, the first expected Federal Reserve rate cut in more than four years keeps pushing later in the calendar, with some wondering if the central bank will reduce its benchmark rate at all this year. Investors will get another glimpse of the inflation picture today when the U.S. Department of Labor releases the Consumer Price Index for April. With it, expect a new round of predictions as to when the Fed will finally ease its policy rate.
By the numbers: The CPI is expected to increase by 0.4% M/M in April, matching the same rate of growth seen in March and February. On a Y/Y basis, that translates to a 3.4% rise vs. 3.5% in the previous month. Stripping out the volatile categories of food and energy, core CPI is expected to increase by 0.3% M/M vs. 0.4% in March, and 3.6% Y/Y, compared with a prior 3.8%. Also pay special attention to categories like rent, housing, transport costs, and insurance.
With the January, February, and March CPI reports coming in hotter than expected, central officials have been hammering home the "higher-for-longer" message. That includes yesterday's speech from Jay Powell, who reiterated a wait-and-see approach on monetary policy. The Fed will "need to be patient and let restrictive policy do its work," he declared, adding that "my confidence is not as high as it was" but expects "inflation will move back down on a monthly basis to levels that were more like the lower readings we were having last year."
Data dependent: Wholesale inflation came in hot on Tuesday, notching its highest level in a year, albeit with some prior revisions. The Nasdaq (COMP:IND) hit a fresh all-time record despite the reading, along with a NY Federal Reserve survey that showed consumers seeing stickier inflation ahead. The latest retail sales report will be released at the same time as today's CPI, at 8:30 AM ET, and that could also be a significant data point for the broader economy as mentioned on yesterday's Wall Street Breakfast. (8 comments)
Meme revival
The meme trade redux is continuing for the third day in a row, although the big names are notching smaller gains in the premarket session... for now. GameStop (GME) and AMC (AMC) saw a combined 37 volatility trading halts on Tuesday, eventually closing +60.1% and +32%, respectively, after Keith Gill, known as Roaring Kitty, tweeted for the first time in nearly three years. GameStop also climbed near the top of Interactive Brokers’ (IBKR) weekly list of most active assets on its platform, with many looking to make money off of GME options. Are we going to see a repeat of 2021's meme frenzy? Only time will tell. (215 comments)
Bundle everything
As streaming services crowd the market, they are now racing to form alliances that offer "choice and value" for customers. The latest is Comcast (CMCSA), which will launch a new streaming bundle that'll include Peacock, Netflix (NFLX), and Apple TV (AAPL) at a "vastly reduced price." That's "everyday pricing, not an introductory pricing," Comcast CEO Brian Roberts announced, saying the StreamSaver bundle will be available this month. Disney (DIS) and Warner Bros. Discovery (WBD) unveiled their own streaming bundle only a week ago, following their partnership with Fox (FOX) to build a joint sports streamer. (7 comments)
Under the sea
Red Lobster will reportedly file for bankruptcy as soon as next week, as the largest U.S. seafood chain works to reach a deal with its creditors and negotiate concessions from landlords. It also just closed around 99 locations, with over 50 restaurants and their equipment being auctioned off. Red Lobster has been struggling with financial troubles for some time, on account of less foot traffic during the pandemic, higher interest rates, and a failed all-you-can-eat shrimp promotion. Majority owner Thai Union Group (OTCPK:TUFBY) previously said it would exit the chain due to "prolonged negative financial contributions."
Today's Markets
In Asia, Japan +0.1%. Hong Kong closed. China -0.8%. India -0.2%.
In Europe, at midday, London +0.3%. Paris -0.2%. Frankfurt +0.4%.
Futures at 7:00, Dow flat. S&P flat. Nasdaq -0.1%. Crude -0.2% at $77.85. Gold +0.5% to $2,371.80. Bitcoin +1.7% to $62,775.
Ten-year Treasury Yield -2 bps to 4.42%.
Today's Economic Calendar
7:00 MBA Mortgage Applications
8:30 Consumer Price Index
8:30 Retail Sales
8:30 Empire State Mfg Survey
10:00 Business Inventories
10:00 Housing Market Index
10:30 EIA Petroleum Inventories
12:00 PM Fed's Kashkari Speech
3:20 PM Fed's Bowman Speech
4:00 PM Treasury International Capital
Companies reporting earnings today »
What else is happening...
Gemini era: Google (GOOGL) reveals new AI-powered products.
Following the release of GPT-4o, OpenAI chief scientist steps down.
U.S. senators push for $32B in emergency spending on AI.
Novo Nordisk (NVO) to test obesity drugs in alcohol use.
Baidu (BIDU) robotaxi unit may turn profitable in 2025.
Auto drama: BYD (OTCPK:BYDDF) unveils new hybrid pickup truck.
Boeing (BA) ran afoul of criminal settlement on 737 crashes - DOJ.
IEA cuts 2024 oil demand outlook, copper hits record high.
Cleveland-Cliffs (CLF) CEO: 'Almost zero chance' of Nippon/US Steel.
NYCB to sell $5B in mortgage warehouse loans to JPMorgan (JPM) unit.
Notable open interest changes for May 15th
Tuesday's total option volume of 44.9 million contracts resulted in net open interest growth of 5.72 million calls and 4.47 million puts. AMC Entertainment (AMC), GameStop (GME), BlackBerry (BB) and Tesla (TSLA) saw the greatest growth. Top five new positions opened include 54k Amazon (AMZN) Sep-24 175 calls, 45k AMC Entertainment (AMC) Jan-26 20 calls, 39k AMC Entertainment (AMC) May-24 12.5 calls, 36k Sunrun (RUN) May-24 14 calls and 35k Faraday Future Intelligent Electric (FFIE) May-24 0.5 calls.
Verint gets $4M deal with Australian Bank for 'new Verint TimeFlex Bot'
Verint continues to see contract wins and groundbreaking customer results for the new Verint TimeFlex Bot. Verint recently received a $$4M contract with a leading bank in Australia to deploy the Verint Open Platform's workforce management WFM and bot capabilities. The bank has been a long-time Verint customer and is now expanding with Verint to replace a WFM solution from another vendor and introduce the artificial intelligence AI powered Verint TimeFlex Bot for its 4,500 agents. Verint TimeFlex Bot will provide the bank's contact center agents with the flexibility to make unlimited schedule changes to reduce attrition and absenteeism while improving agent work/life balance. "This contract is testament to our open platform's unique ability to quickly deliver tangible AI business outcomes," says Verint's Jasen Williams, global vice president, corporate marketing. "The bot fits seamlessly into the customer's existing ecosystem and agents learn how to use the bot within minutes. The result is faster AI business outcomes including improved employee experiences and lower labor costs."
Home Depot price target lowered to $406 from $417 at Truist
Truist lowered the firm's price target on Home Depot to $406 from $417 but keeps a Buy rating on the shares after its Q1 results. Comps declined by 2.8%, but according to Truist Card data, the company was running behind expectations for most of Q1 before trends improved as Spring weather arrived later in April, the analyst tells investors in a research note. Truist adds that Home Depot saw positive comps for Complex Pros in markets where it has invested in its supply chain and outside sales force, also stating that while many homeowners continue to defer big-ticket purchases, it is a matter of "when" not "if" sales accelerate as people invest in their existing homes rather than purchasing something else.
gooooooooooooood morning bobber
thanks!!! will do
? AMC ENTERTAINMENT SURGE PRESENTS OPPORTUNITY TO RAISE FUNDS, SAYS BARRINGTON
Barrington analyst James Goss notes that AMC Entertainment provided additional detail after releasing preliminary results in late April, calling Q1 a "difficult start" to the year and adding that Q2 has "gotten off to a slow start." Significant uncertainty remains due to AMC's high leverage and the current capital structure creates substantial uncertainty for equity values, says the firm, which views the recent surge in the stock as one that "presents an additional opportunity to raise equity funds that can support liquidity and debt reduction" in the hopes of "eventually moving AMC to a structure that could facilitate institutional support." The firm keeps a Market Perform rating on AMC shares.
Reddit Inc call volume above normal and directionally bullish
Bullish option flow detected in Reddit Inc with 20,517 calls trading, 3x expected, and implied vol increasing almost 18 points to 97.51%. May-24 60 calls and May-24 65 calls are the most active options, with total volume in those strikes near 3,900 contracts. The Put/Call Ratio is 0.43. Earnings are expected on August 6th.
Floor & Decor put volume heavy and directionally bearish
Bearish flow noted in Floor & Decor with 3,488 puts trading, or 2x expected. Most active are Jul-24 125 puts and Jun-24 120 puts, with total volume in those strikes near 3,100 contracts. The Put/Call Ratio is 7.89, while ATM IV is up nearly 2 points on the day. Earnings are expected on August 1st.
Market Action: Treasuries pared overnight gains and yields headed higher following the stronger than expected PPI report. But the move was brief as the market awaits upcoming comments from Chair Powell and tomorrow's CPI. The spike provided a buying opportunity and rates are back where they were just before the release. The 2-year rate is down -1.5 bps to 4.846% after spiking to 4.892%. The 10-year is fractionally in the green at 4.475% following its jump to 4.528%. Similarly, the DXY popped to 105.458 but quickly slipped back to 105.148, where it was just prior to the release. Meanwhile, Wall Street futures have taken the numbers in stride too, with the NASDAQ -0.20% lower, while the S&P 500 is fractionally in the red and the Dow marginally in the green.
HIGHER -
Stellantis (STLA) up 2% after the company and Leapmotor announced that the two companies have received all required authorizations and the formation of Leapmotor International, a 51/49 Stellantis-led joint venture, is now complete
UP AFTER EARNINGS -
On Holding (ONON) up 12%
Sea Limited (SE) up 5%
International Game (IGT) up 2%
DOWN AFTER EARNINGS -
Alibaba (BABA) down 4%
Miniso (MNSO) down 4%
Home Depot (HD) down 1%
Augmedix (AUGX) down 45%
LOWER -
Shimmick (SHIM) down 20% after Q1 results below expectations and subsequent breach on its revolving credit facility agreement
European stock markets are narrowly mixed, after a largely weaker close across Asia. The FTSE 100 is up 0.1%, the DAX down -0.2%. German ZEW investor confidence came in much stronger than expected, which backed hopes of a strengthening recovery. However, that also suggests that the ECB will return to a wait and see stance after a June cut, and Eurozone yields jumped higher after the numbers, which kept a lid on stock markets. U.K. wage growth meanwhile came in higher than anticipated, but comments from BoE Chief Economist Pill leave the BoE on course to cut rates over the summer. That helped Gilts to outperform and the U.K. 10-year rate is currently unchanged at 4.172, while the 10-year Bund yield is up 1.5 bp at 2.52%. Treasuries are off early highs, but the U.S. 10-year rate is still down -0.6 bp as markets look ahead to the U.S. PPI report. The DXY dollar index off session highs at currently 105.201. The front end WTI contract has corrected to USD 78.88 per barrel, while the gold price has inched up to USD 2343.51 per ounce.
State of the consumer
Are U.S. consumers finally tightening the purse strings? That's the main question on the minds of investors as major retailers kick off their quarterly earnings reports this week, starting with Home Depot (HD). The home improvement chain's Q1 results came in below Street expectations, hurt by a delayed start to spring, continued softness in certain larger discretionary projects, and higher mortgage rates.
Dig deeper: Retailer earnings come at a time when consumer sentiment is weakening, amid expectations of stickier inflation for some time to come and a tempered outlook for income growth. Investing Group Leader Bret Jensen believes stagflation is an increasingly likely economic scenario. "Right now, I believe the average American consumer has a better handle on the U.S. economy than the average investor and a better take on the true level of inflation than governmental statistics."
Scott Feiler, consumer sector specialist at Goldman Sachs, said the consumer spending concerns have been driven by updates by bellwethers in the sector, and the notable slowdown seen in April - one of the worst months of the retail quarter. Companies like Wayfair (W) and Whirlpool (WHR) have already warned that consumers are cutting back spending on big-ticket items, while fast-food chains such as McDonald's (MCD) and Starbucks (SBUX) have observed pickier and more value-minded customers. "Consumer cracks are emerging," especially among lower incomes, warned Bank of America analyst Savita Subramanian.
Earnings watch: Walmart (WMT), which will report Q1 results on Thursday, is expected to report modest upside to the consensus U.S. comparable sales estimates, driven by bargain-hunting shoppers. Also keep an eye on other retailers scheduled to report results next week: Lowe's (LOW), Target (TGT), TJX (TJX), and Ross Stores (ROST).
Sustained weight loss
Patients who are taking Novo Nordisk's (NVO) blockbuster obesity drug Wegovy have reportedly maintained an average of 10% weight loss four years after starting the treatment. "We see that once the majority of the weight loss is accrued, you don't go back and start to increase weight if you stay on the drug," said Martin Holst Lange, Novo's head of development. The data could help Novo in its efforts to convince insurers and governments to provide coverage for the treatment. The U.K.'s National Health Service provides only two years of Wegovy coverage, while Medicare does not cover the drug. A recent poll showed that many people believe Medicare should cover weight loss drugs. (2 comments)
Resisting takeover
Anglo American (OTCQX:AAUKF) has unveiled a major shakeup of the company - which includes divesting its steelmaking coal and nickel businesses - as the British miner aims to stave off BHP's (BHP) takeover bid. Anglo American will demerge Anglo American Platinum (OTCPK:ANGPY), while its diamond business De Beers will either be divested or demerged "to improve strategic flexibility." The overhaul is aimed at sharpening Anglo American's focus on its mainstay assets - copper and premium iron ore. "These actions represent the most radical changes to Anglo American in decades," its CEO Duncan Wanblad said. The plan was announced just a day after the firm rejected BHP's (BHP) new £34B proposal.
Power grid boost
The Federal Energy Regulatory Commission approved two new rules Monday that are expected to make it easier to expand the construction of big power lines and bring more renewable energy to U.S. homes and businesses. One rule will require companies that produce and transmit electricity to weigh factors such as supply and demand over at least 20 years; the other addresses the permitting of critical projects in areas that lack adequate transmission capacity. The rule requiring long-term planning is "the biggest single action by the federal government to advance transmission," according to Rob Gramlich, president of power consulting firm Grid Strategies. (46 comments)
Today's Markets
In Asia, Japan +0.5%. Hong Kong -0.2%. China -0.1%. India +0.5%.
In Europe, at midday, London +0.1%. Paris -0.1%. Frankfurt -0.2%.
Futures at 7:00, Dow flat. S&P -0.1%. Nasdaq -0.1%. Crude flat at $79.10. Gold +0.3% to $2,349.10. Bitcoin -1.5% to $61,690.
Ten-year Treasury Yield unchanged at 4.48%.
Today's Economic Calendar
6:00 NFIB Small Business Optimism Index
8:30 Producer Price Index
9:10 Fed’s Cook Speech
10:00 Jerome Powell Speech
8:15 PM Fed's Schmid Speech
Companies reporting earnings today »
What else is happening...
WSB survey results: Derisking and diversifying is still the way to go.
Biden administration raises tariffs steeply on Chinese EVs, chips.
Uber (UBER), Lyft (LYFT) face landmark trial on rideshare drivers.
BYD (OTCPK:BYDDF) sends shockwaves across auto with Seagull.
Biden faces mounting calls to take on grocery price-fixing issue.
HubSpot (HUBS) rises on report of 'compelling' offer from Alphabet.
Wedbush: Apple (AAPL)-OpenAI pact appears to be done deal.
OpenAI unveils new flagship model GPT-4o, available for free to all.
OPEC risks losing market share if it does not start raising output.
ZIM (ZIM) surges as container shipping stocks' momentum continues.