November 28, 2020

PR Headline News

Top Stories Without The Fluff

Dow futures down 200, reopening stocks weak

Tech stocks move higher before the bell

Many major tech stocks reversed their premarket falls as the opening bell approached. Shares of Amazon and Apple are now up 0.4% and 0.3%, respectively. Microsoft has cut its losses by more than half and last traded 0.2% lower. Bullish calls on tech stocks were among the biggest calls of the day on Wall Street, including Raymond James raising its target price for Apple and Baird doing the same for Amazon. — Jesse Pound, Michael Bloom

Protests, curfew hurt restaurant sales, Shake Shack says

Shake Shack announced preliminary second-quarter results on Tuesday that showed same-store sales down 49% to $91.8 million compared with the same period last year due to store closures during the pandemic and nationwide protests. The company had previously pulled its full-year guidance due to the pandemic. “Shack sales were estimated to be negatively impacted by approximately $3.2 million in the fiscal period June due to nationwide protest activity and resulting curfews causing temporary Shack closures and reduced operating hours,” the company said in a statement.Shake Shack’s full earnings release is scheduled for July 30. Shake Shack shares traded more than 2% lower in the premarket. —Jesse Pound

Virus deaths not spiking despite outbreaks, Fundstrat’s Lee says

Tom Lee, the head of research at Fundstrat, said in a note to clients Tuesday that deaths from Covid-19 have not seen an increase despite recent outbreaks in places like Arizona, Florida and Texas that have led to more economic restrictions. Deaths can lag reported infections by many weeks, but the low death rates in recent outbreaks has led some to argue that the virus is not as deadly as originally feared.”And perhaps more importantly, daily deaths from COVID-19 remain in a downtrend.  Recall, US cases have been surging for several weeks now and yet, we have not seen a similar surge in hospitalizations (nationwide) nor in deaths,” Lee said.Lee also said that he believed the pandemic had peaked peaked in Houston, one of the major hot spots in the United States. — Jesse Pound

Citi hikes its year-end target to 2,900, citing ‘incessant Fed support’

Citigroup hiked its 2020 S&P 500 target to 2,900 from 2,700, thanks to the “incessant” support of the Federal Reserve that’s caused the market to blow past its previous forecast. Citi’s new forecast still calls for about a 10% decline from here. “While our fundamental assessment still implies downside from current levels, it is more probable that the trading range for the market should be 2,700-3,200 given powerful fiscal and monetary stimuli (with more likely from government next month),” Tobias Levkovich, Citi chief U.S. equity strategist, told clients in a note. In an effort to shore up the economy, the Federal Reserve has slashed interest rates to near zero and announced an unprecedented unlimited asset purchase program. — Maggie Fitzgerald

Fed’s Bostic says virus rise could slow U.S. recovery

The U.S. economic recovery is likely to be “bumpier” now that coronavirus cases are rising in parts of the country, according to Atlanta Fed President Raphael Bostic, whose district covers some of the hardest-hit areas. Speaking to the Financial Times, the central bank official said he is concerned amid spikes in Florida, Georgia and some Western states. “There are a couple of things that we are seeing and some of them are troubling and might suggest that the trajectory of this recovery is going to be a bit bumpier than it might otherwise,” Bostic told the paper. “And so we’re watching this very closely, trying to understand exactly what’s happening.” High-frequency data tracked by Jefferies shows a slight slowing from last week to 57% of the “normal” level as measured by 2019 activity. While flight activity is higher, consumer traffic and employment metrics edged lower. However, Jefferies noted that activity “has clearly flat-lined” after two months of improvement and has shown “particular weakness in virus-hit states.” —Jeff Cox

Large-cap managers have best first half since 2017, says Bank of America

Thanks to the swift rebound from the coronvirus market rout, 42% of large-cap mangers finished the second quarter ahead of their benchmarks, according to Bank of America. This marks the best first half of the year since 2017, when large-cap managers subsequently ended the year with a record hit rate of 48%. This suggests large-cap active managers fared well against the backdrop of unprecedented market volatility, the bank said. “Fund performance was likely helped by both sector positioning and stock selection — mutual funds have had a near-record underweight in both Energy and Financials, the worst-performing sectors YTD, while the stocks most crowded by longonlies have significantly outperformed neglected stocks (a reversal from recent years),” Bank of America equity and quant strategist Savita Subramanian told clients. — Maggie Fitzgerald

Reopening stocks falter as Covid-19 cases balloon

Stocks of companies that would benefit most under a reopening of the U.S. economy came under pressure before the bell Tuesday morning. Mall owner Simon Property Group dropped 1%, United Airlines lost 2.1% and cruise-line operator Carnival shed 2% as the number of new infections, hospitalizations and shutdown orders continued to rise in the U.S. Apparel retailers Gap and Kohl’s dropped 1.3% and 1.1%, respectively. U.S. coronavirus cases now exceed 2.93 million and U.S. deaths now exceed 130,000, according to Johns Hopkins University. — Thomas Franck

Novavax surges after receiving federal funding for vaccine

Biotech stock Novavax jumped 34% in premarket trading after the company announced that it had received $1.6 billion in funding from the federal government. The funding, from Operation Warp Speed, is to help Novavax develop and manufacture a Covid-19 vaccine. The company said its vaccine candidate could be developed “as early as late 2020.” —Jesse Pound

Palantir confidentially files to go public

Palantir, the data analytics software company co-founded by Peter Thiel in 2004, has filed confidentially for a public stock offering. The company has raised roughly $2.6 billion in venture capital, and the valuation has reached $20 billion. “The public listing is expected to take place after the SEC completes its review process, subject to market and other conditions,” the company said in a statement. The notice of a confidential filing does not mean that a public listing is necessarily imminent. – Pippa Stevens, Jordan Novet

Wall Street set to fall after Monday’s big rally

U.S. stock futures were under pressure on Tuesday as tech shares — which led a massive rally in the previous session — fell along with airline and cruise operator stocks. Dow Jones Industrial Average futures dropped 242 points, or 0.9%. S&P 500 and Nasdaq-100 futures slid 0.8% and 0.4%, respectively. On Monday, the Dow surged more than 400 points while the S&P 500 popped 1.6%. The Nasdaq closed at a record high a day earlier, surging 2.2%. – Fred Imbert

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