Market Weekly: July 5 – 11 2020

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    [color=purple][i][b]Where have we been and where are we … wishing all a great & safe week ahead
    Both GOVT & FED have stock market & economy propped up well to where
    we are recovering some economically — but SARS COVID-19 is still on prowl
    Hope all have a


    lol – Deer and GROUNDHOGs trying to eat us out of house & home 😆


    The History of the Fourth of July

    On July 4, 1776, the 13 colonies claimed their independence from England, an event which eventually led to the formation of the United States. Each year on the fourth of July, also known as Independence Day, Americans celebrate this historic event.

    Conflict between the colonies and England was already a year old when the colonies convened a Continental Congress in Philadelphia in the summer of 1776. In a June 7 session in the Pennsylvania State House (later Independence Hall), Richard Henry Lee of Virginia presented a resolution with the famous words: “Resolved: That these United Colonies are, and of right ought to be, free and independent States, that they are absolved from all allegiance to the British Crown, and that all political connection between them and the State of Great Britain is, and ought to be, totally dissolved.”

    ee’s words were the impetus for the drafting of a formal Declaration of Independence, although the resolution was not followed up on immediately. On June 11, consideration of the resolution was postponed by a vote of seven colonies to five, with New York abstaining. However, a Committee of Five was appointed to draft a statement presenting to the world the colonies’ case for independence.

    Members of the Committee included John Adams of Massachusetts; Roger Sherman of Connecticut; Benjamin Franklin of Pennsylvania; Robert R. Livingston of New York; and Thomas Jefferson of Virginia. The task of drafting the actual document fell on Jefferson.

    On July 1, 1776, the Continental Congress reconvened, and on the following day, the Lee Resolution for independence was adopted by 12 of the 13 colonies, New York not voting.

    [size=5][b]Why do we celebrate the Fourth of July?
    Discussions of Jefferson’s Declaration of Independence resulted in some minor changes, but the spirit of the document was unchanged. The process of revision continued through all of July 3 and into the late afternoon of July 4, when the Declaration was officially adopted. Of the 13 colonies, nine voted in favor of the Declaration, two — Pennsylvania and South Carolina — voted No, Delaware was undecided and New York abstained.

    John Hancock, President of the Continental Congress, signed the Declaration of Independence. It is said that John Hancock’s signed his name “with a great flourish” so England’s “King George can read that without spectacles!”

    Today, the original copy of the Declaration is housed in the National Archives in Washington, D.C., and July 4 has been designated a national holiday to commemorate the day the United States laid down its claim to be a free and independent nation.



    June final Markit US services index 47.9 v 46.9 expected
    Prelim 46.7
    Prior 37.5

    Softest fall in output since February amid strengthening demand
    Renewed increases in cost burdens and selling prices
    Business confidence improve

    Composite PMI 47.9 vs 46.8 prelim

    Up significantly from 37.0 in May, and earlier released ‘flash’ figure of 46.8
    The slower overall decline in output was linked to the resumption of operations at manufacturers and many service providers.The softer overall contraction also stemmed from reports of stronger demand conditions relative to those seen earlier in the pandemic.
    The uptick in sales led to the stabilization of new order inflows during June. Although export sales in the service sector increased during the month, a modest decline in manufacturing foreign client demand led to a further overall fall.Manufacturers and service providers alike registered notably slower rates of job shedding in June, as strengthening demand pushed some firms to increase their staffing numbers.
    That said, evidence of excess capacity remained as backlogs of work fell further.Supplier price hikes drove the first increase in cost burdens since February, with private sector firms partly passing on higher costs to clients.

    Finally, companies expressed optimism towards the outlook for output over the coming year for the first time since March


    June US ISM non-manufacturing index 57.1 v 50.2 expected

    Prior 45.4


    Business activity 66.0 vs 41.0 last month (highest since Feb 2011)
    New orders 61.6 vs 41.9 last month
    Employment 43.1 vs 31.8 last month
    Inventory sentiment 55.9 vs 55.1 last month
    Prices paid 62.4 vs 55.6 last month
    Backlog of orders 51.9 vs 46.4 last month
    Supplier deliveries 57.5 vs 67.0 last month
    New export orders 58.9 vs 41.5 last month
    Imports 52.9 vs 43.7 last month
    Full report


    “Businesses are starting to reopen and the economy seems to be on the road to recovery, but let’s not get too complacent, [as] COVID-19 is still a pandemic, [and] a vaccine has not been developed. Economics is the reason for the push for businesses to reopen. Utmost care and awareness still needs to be cautiously and religiously followed.” (Accommodation & Food Services)
    “Surprising recovery to sales volume over the past four weeks.” (Agriculture, Forestry, Fishing & Hunting)
    “Sales have picked up tremendously. Sporadic supply issues. Biggest concern for us is lumber shortages.” (Construction)
    “We are a public higher-education institution. We are expecting budget cuts for fiscal year 2021. Our biggest concern is COVID-19. The plan for a vast majority of higher education institutions is to have students on campus and blend of face-to-face and online classes. However, if students do not effectively social distance, then we could see a dramatic increase in COVID-19 and campuses forced to move to online classes. This will be a major financial blow to revenue for all universities (athletic events, vending, parking, housing, and the like).” (Educational Services)
    “We continue to all work from home globally. Strict restriction on travel and external events. Senior management focusing on a plan for returning to the office.” (Finance & Insurance)
    “COVID-19 has affected us, of course – obtaining PPE supplies has been our focus. Overall census has been very low. Operating rooms, rehab clinics and physician practices were closed or working fewer hours but have since opened back up.” (Health Care & Social Assistance)
    “Advertisers are starting to place more advertisements and the media business is turning around. Generally, we are at the end of the employee furloughs and layoffs. Our work efforts have been focused on navigating COVID-19. We are now shifting to value-add projects. We are cautiously optimistic, although as we get closer to the presidential election, we are on guard of unprecedented civil and social unrest.” (Information)
    “Activity level is holding steady, with the potential of a rebound in the near future.” (Mining)
    “We have seen an overall reduction in our business as a result of COVID-19, with the greatest reduction in the aviation and oil and gas industries. In contrast, the pharmaceutical industry has seen an increase in business during the same time frame.” (Other Services)
    “COVID-19 and the riots have disrupted the normal flow of business. There is no new normal yet.” (Real Estate, Rental & Leasing)


    [size=5][i]Ohhhh the humanity … one of my favorite of all time just passed :ohmy:
    CHARLIE DANIELS just crossed that thin vail over to the other side at age 83[/i][/size]


    [quote=”CautiousInvestor” post=13901][size=5][i]Ohhhh the humanity … one of my favorite of all time just passed :ohmy:
    CHARLIE DANIELS just crossed that thin vail over to the other side at age 83[/i][/size]

    The great long haired country boy Charlie Daniels has left us #RipCharlieDaniels
    Poor man goes to work


    [color=green][size=5][b]Dow 26,287.03 459.67 1.78%
    S&P 500 3,179.72 49.71 1.59%
    Nasdaq 10,433.65 226.02 2.21%
    GlobalDow 2,912.78 54.43 1.90%
    Gold 1,795.60 5.60 0.31%
    Oil 40.60 -0.05 -0.12% [/b][/size][/color]


    French majority party lawmaker,Eric Bothorel, says that government plans to ‘phase out’ Huawei

    France has said that they will only grant time-limited waivers on 5G for wireless operators that use Huawei products, in a move to basically sideline the Chinese company. Bothorel backed that up in an interview, confirming that they are “phasing out” Huawei.

    However, he said that they will not phase out Huawei completely but there will be much less of the company’s involvement in the future network.


    Gapping down

    In reaction to disappointing earnings/guidance:

    QDEL -2.9% (guides Q2 revs above consensus)

    Select financial related names showing weakness:

    GS -0.9%, C -0.9%, WFC -0.8%, JPM -0.8%, XLF -0.7%, MS -0.6%

    Select oil/gas related names showing early weakness:

    SLB -1.8%, HAL -1.3%, OIH -0.9%, TOT -0.9%, XLE -0.8%, XOM -0.7%, BP -0.7%

    Other news:

    EOLS -36.7% (provides update on USITC case; commission to review case; final determination targeted for November 2020)
    CLLS -16.5% (announces clinical hold for MELANI-01 trial)
    CLXT -10.7% (André Choulika, Ph.D. notified Calyxt of his decision to retire from his position as Chairman and as a director effective immediately)
    RVMD -4.3% (announces offering of 5.5 mln shares)
    PCRX -3.2% (guides Q2 revs well above consensus; also announces $300 mln convertible offering)
    ARE -2.3% (prices offering of 6,000,000 shares of common stock at $160.50 per share)
    KL -1.7% (announced production results for Q2)
    CCL -1.4% (sets ship delivery changes and related deployment plans)
    UBX -1% (announces departure of CFO Bob Goeltz)

    Analyst comments:

    COMM -5.5% (downgraded to Mkt Perform from Outperform at Raymond James)
    D -3.6% (downgraded to Neutral from Outperform at Credit Suisse)
    YETI -2.5% (downgraded to Neutral from Buy at Goldman)
    FTNT -1.9% (downgraded to Neutral from Overweight at JP Morgan)
    ILMN -1.9% (downgraded to Neutral from Buy at Guggenheim)
    KMI -1.3% (downgraded to Sell from Neutral at Goldman)
    RTLR -1% (downgraded to Neutral from Buy at Goldman)
    CBOE -0.5% (downgraded to Neutral from Overweight at Piper Sandler)


    Gapping up

    In reaction to earnings/guidance:

    LVGO +11.7%, ROL +7.3% (guidance)

    M&A news:

    VSLR +24.8% (to be acquired by Sunrun (RUN); annual cost synergies estimated at $90 mln), RUN +14%

    Other news:

    CRVS +114.6% (initiated a Phase 1 study to investigate a novel immunotherapy approach for patients with COVID-19)
    NVAX +35.6% (has been selected to participate in Operation Warp Speed, U.S. government program that aims to begin delivering millions of doses of a safe, effective vaccine for COVID-19 in 2021)
    ENDP +15.7% (receives FDA approval for Qwo)
    OTIC +14.8% (provides update on OTIVIDEX program, reports “positive” top-line results from Phase 1/2 trial)
    B +6.7% (announces restructuring actions, including workforce reductions)
    CUB +6% (business division was awarded a $950 million ceiling indefinite-delivery/indefinite-quantity (ID/IQ) contract for the U.S. Air Force’s Advanced Battle Management System)
    GLDD +4.4% (wins several dredging awards totaling $51.1 mln)
    CIDM +3.4% (files for $75 mln mixed securities shelf offering; entered into a Sales Agreement with A.G.P./Alliance Global Partners and B. Riley FBR)
    LGIH +3% (reports June home closings increased 16.7% yr/yr)
    MYGN +2.8% (announces two recent publications validating the polygenic risk score (PRS) component of Myriad’s breast cancer risk stratification tool riskScore)
    REGN +2.1% (awarded $450 million contract to manufacture and supply REGN-COV2)

    Analyst comments:

    AMBA +4.5% (upgraded to Buy from Underperform at Needham)
    ACAD +3.1% (upgraded to Buy from Hold at Stifel)
    VMI +1.7% (upgraded to Buy from Hold at Stifel)


    The global equity markets are mostly weaker to begin Tuesday. The markets are giving back some gains following weak forecasts from the Organization for Economic Co-operation and Development (OECD) and Goldman Sachs surrounding global growth. This seemed to have stymied the upward momentum from yesterday. S&P Futures are down about 25 points to trade around the 3145 area. This is well off the early session high of 3184.00 and just shy of the low of 3140.50.

    In Asia, the markets were mixed with China tacking on gains of 0.4%, while the Nikkei slipped 0.4%. China was the one place that continued the upward momentum after its nearly 6% surge on Monday. The Shanghai’s close represented the highest level for the index since February 2018. Japan opened in the red and was unable to find buyers as the Nikkei saw pressure for the duration of the day to close near the session low. Automotive names saw some profit taking with names such as Toyota and Mazda falling 1-3%.

    In Europe, the major bourses have outpaced the world to the downside thus far. The weakness is broad based with financials among the worst hit. Names such as BNP Paribas and Societe Generale are down about 2%. Energy is struggling with crude oil down well over 1% and flirting with the $40 area.


    US treasury auctions $46 billion 3 year notes at 0.19%, WI 0.189% (tail 0.1 bps)

    Bid to cover 2.44x v. six-month average 2.43x
    Dealers 32.45% v. 37.2% six-month average
    Directs 13.3% v. six-month average of 11.7%
    Indirects 54.3% vs. six-month average of 51.1%


    [size=5]With today’s ES_F sell-off helped by bond buying/activity this crossed my desk ….

    Fixed interest platform MarketAxess Holdings $MKTX hit a new record high – one to keep your eyes on[/size]

    Seemed to be indicative of treasury move which led to index futures move


    [color=red][size=5][b]Dow 25,890.18 -396.85 -1.51%
    S&P 500 3,145.32 -34.40 -1.08%
    Nasdaq 10,343.89 -89.76 -0.86%
    GlobalDow 2,880.37 -33.44 -1.15%
    Gold 1,807.50 14.00 0.78%
    Oil 40.49 -0.14 -0.34%[/b][/size][/color]

    RINGO turns 80 today 8)

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