QuantPartners: Morning Note 07/22/22 $SPY Call Squeeze - Heads Up!
Can The S&P 500 Clear 4000 Today?
Overnight Summary: The S&P 500 closed Thursday at 3998.95 (higher by 0.99%) from 3959.90 (higher by 0.59%) on Wednesday. Futures are trading lower in the premarket session. The overnight high of 4004.75 was hit at 4:05 a.m. EDT. The low was hit at 3980 at 3:40 a.m. EDT, a range of 24 points high to low which is below the range of late with 45 the average range. At 7:25 a.m. EDT the current price is 3989.75 which is -0.29% and -11.50 points.
Interesting Chart: An interesting group of shorter term sentiment indicators we watch at Erlanger Research is Options Data. This can be great to give a heads up when sentiment starts swinging too much in one direction. In this case it is call activity and specifically the Call/Put Erlanger Ration 10-day. This is defined as “measures the volume weighted average price of a stock/etf’s call options versus the volume weighted average price of a stock/etf’s put options. The higher the ratio, the greater the overall value in call options. This is both a measure of sentiment as premiums expand, but also a measure of momentum as, in this case, price advances bulge the value of call contracts. Therefore, the greater the Call/Put Erlanger Premium ratio, the greater the bullish sentiment and the greater the maturity of a price advance phase.”
Generally when a market starts moving up, there becomes the possibility of people getting too enthusiastic to the upside. On a short term basis the market will pause or eventually pullback to remove the excess. We are seeing that in SPY 0.00%↑ now.
Earnings Out After The Close:
Beats: UFPI +0.84, THC +0.71, WRB +0.27, ASB +0.12, MAT +0.12, VICR +0.11, HTH +0.10, WAL +0.09, PPG +0.09, OZK +0.08, FFBC +0.04, RHI +0.01, SNAP +0.01.
Flat: GBCI +0.00.
Misses: SIVB (2.02), SAM (0.31), STX (0.30), BJRI (0.15), COF (0.09), ISRG (0.06).
Capital Raises:
New SPACs launched/News:
ArcLight Clean Transition Corp. II (ACTD) completes business combination with OPAL Fuels; begin trading on the Nasdaq on July 22 under ticker “OPAL”.
Common Stock filings/Notes:
WULF: Filed Form S-3.. 5,787,732 Common Stock.
WETG: Announces Uplisting to Nasdaq Capital Market and Closing of $40 Million Public Offering of Common Stock.
Mixed Shelf Offerings:
EW: Filed Form S-3ASR.. Mixed Security Shelf.
GRPH: Filed Form S-3.. $300 Million Mixed Security Shelf.
MOFG: Filed Form S-3.. $100 Million Mixed Security Shelf.
SYF: Filed Form S-3ASR.. Mixed Shelf.
Convertible Offering & Notes Filed:
NKE: Filed Form S-3ASR.. Debt Security Shelf.
RWAY: Prices Offering of 7.50% Notes due 2027.
Capital Raise Summary From The TradeXchange, bringing traders and investors real time news and Squawk Box, and other sources.
News After The Close:
After Hours:
Trading Up: HNGR +24%, NOVT +7%, OZK +5%, SIX +4%, UFPI +4%, THC +4%.
Trading Down: SNAP -26%, ISRG -13%, STX -10%, CRSR -10%, SIVB -8%, SAM -8%, TTD -7%, SBTX -6%, PINS -6%, WDC -6%, APPS -6%, COF -5%, RHI -5%, META -5%, PUBM -5%, MGNI -4%.
News Since The Close:
Stocks making the biggest moves after hours: SNAP, META, MAT, SAM, ISRG, COF (CNBC)
Social media and online ad stocks drop in wake of alarming Snap (SNAP) earnings report. (CNBC)
Rivian (RIVN) stock rises as Amazon (AMZN) starts using EV maker’s electric delivery vans. (MarketWatch)
Boston Beer (SAM) slashes earnings forecast as the downfall of hard seltzer continues. (MarketWatch)
Textron (TXT) awarded $354 million U.S. Army contract.
Exchange/Listing/Company Reorg and Personnel News:
GMS promoted Travis Hendren to Chief Operating Officer.
Invitation Homes (INVH) Announces Cash Dividend.
Vera Bradley (VRA) announces planned retirement of President and CEO Robert Wallstrom.
Verisk Analytics (VRSK) names Elizabeth Mann as Executive Vice President and CFO.
Index changes:
Novanta (NOVT) will replace Six Flags Entertainment (SIX) in the S&P MidCap 400.
Six Flags Entertainment (SIX) will replace Natus Medical (NTUS) in the S&P SmallCap 600.
Buyback Announcements or News:
Intuitive Surgical (ISRG) increases share repurchase authorization to $3.5 billion.
Magyar Bancorp, Inc. (MGYR) announces stock repurchase program.
Snap Inc. (SNAP) announced today its Board of Directors has authorized a stock repurchase program of up to $500 million of its Class A common stock.
Supervielle (SUPV) Announces a Program for the Repurchase of Own Shares.
Stock Splits or News:
CLRB 1 for 10 reverse split.
GME trading split price this morning.
Dividends Announcements or News:
CenterPoint Energy (CNP) declares an increase to the regular Common Stock quarterly dividend to $0.1800 and Series A Preferred Stock dividend of $30.6250.
SCHL: Regular Quarterly Dividend Raised 33% to $0.20 Per Share.
South Plains Financial, Inc. (SPFI) Announces 9% Increase to Quarterly Cash Dividend.
Valero Energy Corporation (VLO) Declares Regular Cash Dividend on Common Stock.
What’s Happening This Morning: Futures value reflects the change with fair value.
S&P 500 -5, Dow Jones +50, NASDAQ –28, and Russell 2000 +0.5. Europe higher and Asia higher ex Shanghai. VIX Futures are at 26.30 from 27 yesterday morning and the VIX closed at 23.88 from 24.50 yesterday. Gold higher, Silver lower and Copper higher. WTI Crude Oil and Brent Oil Futures lower and Natural Gas lower. $ is higher vs Euro, higher vs Pound and lower vs Yen. US 10 year Treasury sees yields at 2.818% from 3.045% yesterday morning. Bitcoin is at $23,444 from $22,903 yesterday morning and is higher by 1.71% this morning. As of 8:09 a.m. EDT.
Sector Action – 07/21/22 Close (1/3/6/12/YTD Updated Weekly with Monday release):
Daily Positive Sectors: Consumer Cyclical, Technology, Healthcare, Basic Materials of note.
Daily Negative Sectors: Energy of note.
Slow start to the day but finished the last leg strong around the bend. SPX is a stones throw away from 4,000 after almost hitting 3,600 in June. NASDAQ was up 1.36%. TLT continued up closing at $116.59 for a 1.73% gain. Updated 07/21/22 close.
Upcoming Earnings Of Note: (sorted by market cap, highest to lowest with most visible names)
Friday After the Close: none of note.
Monday Before the Open: NEM, PHG, RPM, DORM, CBU, SQSP, BOH, SBSI of note.
Earnings of Note This Morning:
Beats: NEP +2.37, ALV +0.54, HCA +0.50, AXP +0.16, ROP +0.10, SLB +0.10, RF +0.06, NEE +0.05, SXT +0.03, FBP +0.02.
Flat: None of note.
Misses: CLF (0.23), VZ (0.01).
Still to Report: GNTX, TWTR.
Guidance:
Positive Guidance: IPAR, SLB of note.
Negative Guidance: DHI, CRSR, THC, STX, PPG, SAM, AKA, VZ of note.
Erlanger Research Advance/Decline Chart: Updated through 07/21/22 close.
Gap Ups & Down In Early Pre-Market:
Gap Up: HNGR +24%, VICR +8%, AUPH +8%, THC +7%, NOVT +6%, OZK +5%, SIX +4%.
Gap Down: SNAP -29%, STX -12%, ISRG -12%, CRSR -11%, SBTX -10%, SAM -9%, SIVB -9%, PINS -7%, TTD -7%, WDC -7%, APPS -6%, BJRI -5%, MGNI -5%, GRPH -5%, META -4%, MU -4%, VLRS -4%, PUBM -4%, RHI -4%.
Insider Action: sees Insider buying with dumb short selling. sees Insider buying with smart short sellers. 07/21/22 close.
Rags & Mags: Repeated stories from prior days never listed, i.e. “rehashed news”. Sorted by Global, U.S. and stock specific.
Stocks Making The Biggest Moves: AXP, SLB, HCA, SNAP, CLF, VZ. (CNBC)
Five Things You Need to Know to Start Your Day (Bloomberg)
5 things to know before the stock market opens Friday. (CNBC)
Bloomberg Lead Story: Trump Insiders recall Jan 6th actions by the president and how he spurned please to stop riot. (Bloomberg)
Bloomberg Most Read Story: Musk lieutenant scrutinized by internal memo Tesla Purchasing Memo indicating glass could have been purchased for Musk’s personal use. (Bloomberg)
Germany to bailout energy giant Uniper to the tune of $15 billion as Russia hurts natural gas supplies forcing Uniper to buy gas at much higher spot prices. (CNBC)
Nord Stream 1 pipeline flows to most of Europe remain stable but not close to 100% and flows to Poland from Germany were slower. (Reuters)
Republican NY Governor Candidate Zeldin was attacked by a crazed man with a weapon. (Bloomberg)
Bank of America stated “everyone is bearish but no one has sold.” (Bloomberg)
FedEx (FDX) to suspend Sunday delivery in some markets. (WSJ)
Russia and Ukraine cut a deal to export stranded grain out of the ports of Odessa. (FT)
China to extend antidumping duties on steel from Japan and South Korea. (Reuters)
Senate to finalize and pass the Semiconductor Bill next week. (CNN)
Moving Average Update:
Score remains exactly at 80%. Updated 07/21/22 close.
Geopolitical:
President’s Public Schedule:
The President receives the President’s Daily Brief, 10:30 a.m. EDT
Press Briefing by Press Secretary Karine Jean-Pierre and COVID-19 Coordinator Dr. Ashish Jha, 3:00 p.m. EDT
Economic:
On Friday, the Bank of Japan (BOJ) is also out with its latest announcement on Thursday night U.S
PMI Composite Flash 9:45 a.m. EDT
Baker Hughes Rig Count 1:00 p.m. EDT
Federal Reserve / Treasury Speakers:
Fed Speakers are on a Blackout Period into the FOMC Meeting. Blackout Period from July 16-July 28.
M&A Activity:
Hanger, Inc. (HNGR) Announces Definitive Agreement to be Acquired by Patient Square Capital for $18.75 Per Share in Cash.
Meeting & Conferences of Note:
Sellside Conferences:
None of note.
Investor/Analyst Day/Calls: SEE
Industry Meetings:
Federation of Defense & Corporate Counsel (FDCC) Annual Meeting 2022 (07/23/22-07/30/22)
American Association for Clinical Chemistry (AACC) Annual Scientific Meeting and Clinical Lab Exposition 2022 (07/24/22-07/28/22)
The 24th International Symposium on the Photochemistry and Photophysics of Coordination Compounds 2022 (07/24/22-07/29/22)
Top Tier Sell-side Upgrades & Downgrades: