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The Market In 5 Minutes: DryShips, Trump And Target

Benzinga News Desk

Macro Focus

Global stocks continued to gain as bond prices fell, a sign that investors are still eager to buy risky assets after Donald Trump’s presidential victory.

Futures for the Dow Jones Industrial Average fell 51 points to 18,832.00, while the Standard & Poor’s 500 index futures declined 7.25 points to 2,172.25. Futures for the Nasdaq 100 index dropped 17.25 points to 4,750.50.

Oil prices traded lower as Brent crude futures dropped 1 percent to trade at $45.88 per barrel, while US WTI crude futures also fell 1.10 percent to trade at $45.88 a barrel.

USA PPI (YoY) for Oct 0.80% vs 1.20% consensus estimate; The prior reading was 0.70%. USA Core PPI (YoY) for Oct 1.20% vs 1.50% consensus estimate; The prior reading was 1.20%.

  • Data on industrial production for October will be released at 9:15 a.m. ET.
  • The housing market index for November is schedule for release at 10:00 a.m. ET.
  • The Energy Information Administration’s weekly report on petroleum inventories is schedule for release at 10:30 a.m. ET.
  • The Treasury International Capital report for September will be released at 4:00 p.m. ET.
  • Philadelphia Federal Reserve Bank President Patrick Harker is set to speak in Philadelphia at 5:30 p.m. ET.

BZ News Desk Focus

  • Lowe's (NYSE: LOW) Q3 EPS $0.88 vs $0.96 Est., Revenue $15.74B vs $15.86B Est.
  • Target (NYSE: TGT) Q3 EPS $1.04 vs $0.83 Est., Revenue $16.44B vs $16.30B Est.
  • Agilent Technologies (NYSE: A) Reports Q4 EPS $0.59 vs. $0.52 Est., Rev. $1.11B vs. $1.07B Est.

Sell-Side Themes

At least three firms downgraded Teva Pharma (NYSE: TEVA) following its earnings on Tuesday.

Axiom's Gordon Johnson downgraded the solar sector just a month after upgrading the sector, most notably putting a Sell rating on SolarCity (NASDAQ: SCTY).

Sell-Side's Most Noteworthy Calls

  • Credit Suisse downgraded Lululemon (NASDAQ: LULU) to Neutral.
  • Morgan Stanley downgraded H&R Block (NYSE: HRB) to Equal-Weight.
  • Deutsche Bank upgraded Disney (NYSE: DIS) to Buy.
  • Goldman Sachs upgraded Copa Holdings (NYSE: COPA) to Buy.
  • Chardan started Teladoc (NYSE: TDOC) at Buy.

Deal Talk

Snapchat will likely hit the market in 2017 after officially filing IPO papers with the SEC, Wall Street Journal has reported. The IPO could value the social media giant at $20-25 billion. Snap Inc.'s offering could take place as early as March of next year.

Patriot National (NYSE: PN) is said to be considering a better offer than $475 million offer submitted by Ebix (NASDAQ: EBIX), according to a report from Insurance Insider on Tuesday. CEO Steven Mariano told analysts the Ebix offer was rejected because "we had a better offer from someone else." Mariano said "there is still a process going."

In The News

President Xi Jinping wants to make his nation a military player on the world stage. But China’s first combat deaths in decades have prompted soul-searching in a country that until recently had practiced non-intervention in affairs abroad.

A number of stocks, led by DryShips (NASDAQ: DRYS), have delivered mind-boggling gains in the week since Donald Trump’s victory in the U.S. elections. The typical short squeeze happens when a stock’s fundamentals unexpectedly improve. As a result, the surge in buying following the news is compounded by short sellers buying to close out their short positions. However, in extreme cases, such as the DryShips scenario, broker inventories can also come into play.


President-elect Donald Trump has the opportunity to remake the Federal Reserve. Or does he? And if he does, what would it look like?



#2016WasTheYearThatIFinally stopped trading? Stopped voting?

Guess This Chart

  • This company is trading up after it announced in its Q3 earnings report that back to school sales were stronger than expected.
  • This company is also rumored to be interested in acquiring Verifone Systems.
  • Sympathy plays include Wal-Mart, Costco and Amazon.

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