After Hours Report

It was a choppy session in the stock market. Participants were dealing with rising rates (10-yr yield hitting 4.73% at its high), volatile mega caps, and some economic releases. Ultimately, the S&P 500 settled 0.2% higher and the Dow Jones Industrial Average rose 0.3% while the Nasdaq Composite declined 0.1%.

The Treasury market settled little changed from yesterday after a choppy session. The 10-yr yield rose one basis point to 4.69% and the 2-yr yield settled one basis point lower at 4.29%. Treasuries were responding to this morning's economic releases, along with today's $22 billion 30-yr bond reopening, which met strong demand. 

The economic data included a below-consensus ADP Employment Change report for December (122,000; Briefing.com consensus 131,000), and an unexpected drop in weekly Initial Claims (201,000; Briefing.com consensus 218,000; prior 211,000).

Market participants also received the FOMC Minutes for the December 17-18 meeting, which echoed Fed Chair Powell's remarks in his press conference after the meeting. The minutes conveyed a belief that the Fed should hold off on another rate cut until it has more confidence in inflation returning to its 2% target and/or more concern about the labor market deteriorating in a more pronounced manner.

Stocks and bonds took the release in stride while the fed funds futures market repriced rate cut expectations. The fed funds futures market now sees only a 40.4% probability of a 25-basis points rate cut at the March FOMC meeting versus 53.0% a week ago and 69.1% a month ago, according to the CME FedWatch Tool.

As a reminder, the NYSE is closed tomorrow in observance of the National Day of Mourning in honor of late former President Jimmy Carter.

• Nasdaq Composite: +0.9% YTD
• S&P Midcap 400: +0.7% YTD
• S&P 500: +0.6% YTD
• Russell 2000: +0.4% YTD
• Dow Jones Industrial Average: +0.2% YTD

Reviewing today's economic data:

• Weekly MBA Mortgage Applications -3.7%; Prior -21.9%
• December ADP Employment Change 122K (Briefing.com consensus 131K); Prior 146K
• Weekly Initial Claims 201K (Briefing.com consensus 218K); Prior 211K, Weekly Continuing Claims 1.867 mln; Prior was revised to 1.834 mln from 1.844 mln
  • The key takeaway from the report is that layoff activity is low, but for employees that lose their job it has become more challenging to find a new one.
• November Wholesale Inventories -0.2% (Briefing.com consensus -0.2%); Prior was revised to 0.0% from 0.2%
• November Consumer Credit -$7.49 bln (Briefing.com consensus $9.1 bln); prior revised to $17.3 bln from $19.2 bln
  • The key takeaway from the report is that consumer credit contracted in November for only the third time in the past 16 months with revolving credit, which is subject to extra high interest rates, acting as the drag.

Overseas:

• Europe: DAX -0.1%, FTSE +0.1%, CAC -0.5%
• Asia: Nikkei -0.3%, Hang Seng -0.9%, Shanghai +0.0%

Commodities:

• Crude Oil -1.09 @ 73.28
• Nat Gas +0.14 @ 3.17
• Gold +8.40 @ 2673.40
• Silver +0.03 @ 30.71
• Copper +0.07 @ 4.27

After-Hours Spotlight:

• Costco (COST) reports December adjusted comparable sales of +9.9%... COST up 1.9%
• Globus Medical (GMED) issues upside Q4 revenue guidance, issues inline FY25 revenue guidance... GMED up 3.3%
• Honest Company (HNST) CFO Dave Loretta will retire this year; initiated search for replacement; reiterates FY24 outlook... HNST up 1.9%
• Jefferies (JEF) reports Q4 (Nov) results, beats on revs; raises dividend... JEF down 3.1%
• NVIDIA (NVDA) down after the Biden administration plans additional round of restrictions on AI chip exports, according to Bloomberg... NVDA down 1%
• Penguin Solutions (PENG) beats by $0.10, beats on revs; guides FY25 EPS in-line, revs in-line... PENG up 11.9%
• Walt Disney (DIS) climbing after estimating its ad-supported tiers have 157 mln global MAUs , according to CNBC... DIS up 1.1%

Fair Value for Friday, Jan 10:

• S&P 500: 5,962
• Nasdaq 100: 21,359
• DJIA: 42,898

For a full rundown of today's market and after hours developments, see Live In Play

• Earnings/Guidance (Full Earnings Calendar):
  • AAR Corp (AIR) beats by $0.05, beats on revs
  • Acuity Brands (AYI) beats by $0.07, reports revs in-line
  • Albertsons (ACI) beats by $0.05, reports revs in-line; guides FY25 EPS in-line
  • AngioDynamics (ANGO) beats by $0.07, beats on revs; guides FY25 EPS above consensus, reaffirms FY25 revs guidance
  • Avita Medical (RCEL) lowers Q4 commercial revenue guidance due to combination of factors, with slower-than-expected purchasing activity being the primary driver
  • AZZ (AZZ) beats by $0.13, beats on revs; raises FY25 EPS and revenue guidance
  • Butterfly Network (BFLY) sees Q4 revs above consensus
  • Cal-Maine Foods (CALM) beats by $0.42, beats on revs (two estimates)
  • Exxon Mobil (XOM) provides summary of items it believes will impact Q4 results; Sees changes in liquids pricing impacting upstream business by $(0.9) - $(0.5) bln
  • Flutter Entertainment (FLUT) lowers 2024 revenue and adjusted EBITDA guidance; cites very unfavorable US sports results
  • Getty Realty Corp. (GTY) provides an update on its Q4 investment and capital markets activities and issues upside FY25 FFO guidance
  • Halozyme Therapeutics (HALO) reaffirms FY24 guidance, raises FY25 revenue and EPS guidance, and announces new $250 mln Accelerated Share Repurchase program
  • Kamada (KMDA) reaffirms FY24 guidance, raises FY25 guidance, and announces that based on positive feedback from the U.S. FDA, it plans to reduce Inhaled AAT clinical study sample size
  • Kura Sushi (KRUS) beats by $0.13, beats on revs; Issues downside FY25 revenue guidance
  • MSC Industrial (MSM) beats by $0.13, beats on revs
  • Personalis (PSNL) guides Q4 revenue above consensus; Company delivered 1,441 total molecular tests in Q4
  • Profound Medical (PROF) guides Q4 revs slightly below consensus
  • Samsung (SSNLF) sees Q4 revs of KRW74-76 tln
  • Sandstorm Gold (SAND) issues downside Q4 revenue guidance (two estimates), and reiterates long-term production forecast of reaching approximately 125,000 attributable gold equivalent ounces within the next five years
  • Shell (SHEL) fourth quarter 2024 update note
  • Simply Good Foods (SMPL) beats by $0.03, misses on revs; reaffirms FY25 revs guidance
  • Simulations Plus (SLP) misses by $0.13, reports revs in-line; guides FY25 EPS above consensus, revs in-line
  • Terreno Realty Corporation (TRNO) announces quarterly operating, investment and capital markets activity
  • TXNM Energy (TXNM) reaffirms FY24 EPS guidance during investor meetings
• General News
  • President-elect Trump considering declaring national economic emergency so he will have the full authority to impose tariffs, according to CNN
  • Hamas wants Israel to fully end war in Gaza in exchange for hostage releases after President-elect Trump warned of consequences if hostages are not released by January 20, according to Reuters
  • President Biden in interview defended his economic and foreign policy record and said he believes he could have won the 2024 election, according to USA Today
  • House passes bill by a vote of 264-159 that will authorize deportation of undocumented immigrants charged with crimes. Senate will vote on Friday and then will hold the bill until President-elect Trump takes office so he can sign it, according to the New York Times
  • California wildfires force thousands of evacuations. 200K customers have lost power, according to the New York Times
  • CFTC Chairman Rostin Behnam announces departure from CFTC
  • White House announces record-breaking 2025 open enrollment period under the Affordable Care Act
  • Accolade (ACCD) discloses addtional merger details including termination fee
  • Agios Pharma (AGIO) announces that the U.S. FDA accepted the company’s supplemental New Drug Application for PYRUKYND for the treatment of adult patients with non-transfusion-dependent and transfusion-dependent alpha- or beta-thalassemia
  • Air Lease (AL) provides activity update for Q4
  • Air Products (APD): Mantle Ridge Issues Shareholder Letter Outlining the Path Forward for Air Products and Chemicals, Inc.
  • Albertsons (ACI) increases quarterly common stock dividend to $0.15/share from $0.12/share
  • Allison Transmission (ALSN) secures $80.6 million contract for Abrams Tank Program
  • Amazon (AMZ): AWS Launches Infrastructure Region in Thailand
  • Amazon (AMZN) plans to invest at least $11 billion in Georgia to expand infrastructure to support AI and cloud technologies
  • Amazon (AMZN) Ads brings generative AI to Amazon Marketing Cloud with new SQL generator
  • American Coastal Insurance Corporation (ACIC) successfully renewed its all other perils catastrophe excess of loss agreement - provides coverage for in-force, new and renewal business
  • Apple (AAPL): Indonesia keeps Apple iPhone 16 ban in place, according to Bloomberg
  • AT&T (T) unveils first & only customer-first promise across both wireless & fiber networks
  • Avidity Biosciences (RNA) announces its progress and planning for a transformational year in 2025
  • BioCryst Pharma (BCRX) is implementing an increase in the wholesale acquisition cost for ORLADEYO (berotralstat) in the United States from $42,366.03 per 28-day pack (of either 150mg or 110mg capsules) to $44,484.33 per 28-day pack (of either 150mg or 110mg capsules)
  • BioStem Technologies (BSEM) announces the initiation of the BR-AM-DFU clinical trial to evaluate Vendaje versus standard of care for patients suffering with non-healing diabetic foot ulcers
  • Boeing (BA): FAA is adopting a new airworthiness directive for all The Boeing Company Model 767-200, -300, and -300F airplanes
  • BurTech Acquisition Corp. (BRKH) announces stockholder approval of business combination with Blaize
  • Camden Property Trust (CPT) Issues Response to Department of Justice Lawsuit
  • Cassava Sciences (SAVA) Provides a Business Update
  • Catalyst Pharma (CPRX) and SERB settle patent litigation with Teva (TEVA), delaying generic FIRDAPSE launch until 2035
  • Chart Industries (GTLS) signs global master goods and services agreement with ExxonMobil (XOM)
  • Clarivate (CLVT) Identifies Eleven Potential Blockbuster and Transformative Drugs in Annual Drugs to Watch Report
  • Collegium Pharmaceutical (COLL) provides guidance for FY25
  • Compugen (CGEN) Announces First Patient Dosed in Phase 1 Clinical Trial to Evaluate COM503 as Monotherapy and in Combination with Zimberelimab in Advanced Solid Tumors
  • ComScore (SCOR) amended Charter (CHTR) data license agreement
  • Crown Castle (CCI) will cease serving as CFO, effective March 31
  • CVR Energy (CVI) provides investor updates in presentation
  • Dynex Capital (DX) clarifies content on LinkedIn that included certain financial metrics was inadvertently included in error
  • Eli Lilly (LLY): Medicare drug plans can cover LLY's Zepbound as treatment for obstructive sleep apnea, according to CNBC
  • Embraer SA (ERJ) Brazil: Delivers 75 aircraft in 4Q24 – or 27% higher than in the previous quarter (3Q24), when 59 aircraft were delivered, and equal to the volume of the same period of 2023
  • Endeavour Silver (EXK) provides Terronera progress update
  • Equinox Gold (EQX) updated Mineral Reserve and Mineral Resource estimate effective June 30, 2024 for its Fazenda Mine - extended the Fazenda mine life to 2033
  • eXp World Holdings (EXPI) detailed earlier the settlement of litigation
  • Ford Motor (F): BlueOval SK workers file for union election, citing safety and fairness concerns
  • FTAI Infrastructure (FIP) provides Long Ridge Energy & Power updates
  • Galapagos NV (GLPG) intends to separate into two publicly traded entities
  • GE Aerospace (GE) receives T700 engine order for Poland’s Apache Guardian helicopters
  • General Motors (GM) is collaborating with EVgo (EVGO) to build a total of 2,850 DC public charging stalls, including 400 fast charging stalls at flagship destinations in major metropolitan areas across the U.S.
  • GlaxoSmithKline (GSK) close to $1 bln deal to purchase IDRx, according to FT
  • H & R Block (HRB): FTC finalizes order with H&R Block requiring them to pay $7 million and overhaul advertising and customer service practices for 2025 and 2026 tax seasons
  • Hershey Foods (HSY) wants permission to sell cocoa through the New York exchange, according to Bloomberg
  • Himalaya Shipping Ltd. (HSHP) provides commercial update and key information relating to the cash distribution for December 2024
  • Hut 8 Mining (HUT) releases its operations update for December 2024; mines 94 bitcoin
  • Instacart (CART) and Ulta Beauty (ULTA) announce a nationwide partnership to offer same-day delivery
  • Jasper Therapeutics (JSPR) Reports Positive Data from BEACON Study of Briquilimab in Chronic Spontaneous Urticaria
  • Johnson & Johnson (JNJ) MedTech pauses U.S. VARIPULSE external evaluation amid investigation into neurovascular events
  • KBR (KBR) announces segment reporting updates and executive appointments; Stuart Bradie, President and CEO appointed Chair Elect, Byron Bright named COO effective may 2025
  • Lifevantage (LFVN) guides DecQ and FY25 revs above consensus
  • Lithium Argentina (LAAC) announce its 2024 production results for the Caucharí-Olaroz lithium brine operations in Argentina and provide production guidance for 2025
  • Lockheed Martin (LMT): President Biden will announce final $500 mln in Ukraine aid, according to Bloomberg
  • Lockheed Martin (LMT) delivered 110 F-35s in 2024, growing the global fleet to 1,100+ aircraft
  • Matthews (MATW): Barington Capital Group statement on Matthews International's sale of SGK Brand Solutions
  • Merck (MRK) GARDASIL receives expanded approval for males in China
  • Meta Platforms (META): Some Meta employees are concerned about decision to end fact-checking, according to CNBC
  • Meta Platforms (META) aiming to test feature that will allow buyers to browse listings from eBay (EBAY), according to Reuters
  • MoonLake (MLTX) initiates three new clinical trials and further expands the portfolio of indications for the Nanobody sonelokimab
  • Murphy Oil's (MUR) subsidiary has drilled an oil discovery at Hai Su Vang-1X in Offshore Vietnam
  • Nova Minerals (NVA) extinguishes nebari debt to unlock antimony and gold potential
  • Novo Nordisk A/S (NVO) and Valo Health expand collaboration to discover and develop novel treatments for cardiometabolic diseases
  • Nvidia (NVDA) CEO Jensen Huang says it will be 15 years before there will be "useful" quantum computers, according to Bloomberg
  • ORIX Corporation (IX) provides notice regarding change in ratio of ADSs to Common Shares
  • Pacific Biosciences (PACB) has delivered its first Vega systems to Berry Genomics as part of an early access agreement announced in 2022
  • Perfect Corp. (PERF) announced the successful closing of its acquisition of Wannaby
  • PG&E (PCG): Two people are dead in California wildfires and several homes and businesses have been destroyed, according to NY Times
  • Phillips Edison & Company (PECO) announces transaction activity for Q4
  • Profound Medical (PROF) guides Q4 revs slightly below consensus
  • Qiagen (QGEN) partners with Genomics England to support the delivery of the Generation Study
  • Quanta Services (PWR) COO J. Redgie Probst resigned
  • Quantum (QMCO) provides clarification regarding recent shareholder transactions
  • Quarterhill (QTRHF) CFO to depart
  • RCI Hospitality (RICK) reports Q1 club and restaurant sales of -3.3% yr/yr to $70.9 mln
  • Rio Tinto (RIO): Fortune Minerals provides an update of NICO project test work, Rio Tinto process collaboration & feasibility study
  • Rocket Lab USA (RKLB) Selected by Kratos (KTOS) to deliver hypersonic test launches for DoD with HASTE Rocket; total potential value of the MACH-TB 2.0 Contract Award over a five-year period is $1.45 billion
  • Sana Biotechnology (SANA) Announces Positive Clinical Results from Type 1 Diabetes Study of Islet Cell Transplantation Without Immunosuppression
  • Seaport Entertainment Group (SEG) provides update on recent activities, including entering into interim license agreement and long-term lease with Tulum based Grupo Gitano
  • Sight Sciences (SGHT) Announces Real-World 36-Month Study Confirming Long-Term Effectiveness of Standalone OMNI Surgical System in Managing Primary Open-Angle Glaucoma
  • Solaris Energy Infrastructure COO Kelly Price retired
  • Solaris Resources Inc. (SLSR) announces the strengthening of its leadership team with the appointment of Richard Hughes as Chief Financial Officer and Company Secretary, Patrick Chambers as Vice President Investor Relations and Ignacio Shimamoto as Vice President Finance, effective immediately
  • Solid Biosciences (SLDB) Announces FDA IND Clearance for First-In-Industry Dual Route of Administration Gene Therapy to Treat Both Neurologic and Cardiac Manifestations of Friedreich’s Ataxia
  • Solventum Corporation (SOLV): Trian (Nelson Peltz) issues open letter to Solventum shareholders; believes the company’s shares could be worth $140 by year-end 2027
  • Sterling (STRL) Announces Amendment to Road and Highway Builders, LLC Operating Agreement
  • Tencent (TCEHY) discloses changes in issued shares or treasury shares, share buybacks and/or on-market sales of treasury shares
  • TransUnion (TRU) has signed a definitive agreement to acquire U.K.-based Monevo
  • UniFirst (UNF) beats by $0.02, reports revs in-line; guides FY25 revs in-line, reaffirms FY25 EPS guidance
  • United Natural Foods (UNFI) announces realignment of wholesale business
  • Vertical Aerospace Group (EVTL) begins 2025 with piloted thrustborne milestone
  • Viking Therapeutics (VKTX) announces the initiation of a Phase 2 clinical trial of the oral tablet formulation of VK2735, the company's dual agonist of the glucagon-like peptide 1 and glucose-dependent insulinotropic polypeptide receptors
  • Viridian Therapeutics (VRDN) announces the company’s key priorities and catalysts for 2025
  • W&T Offshore (WTI) provides updates on recent developments
  • W.P. Carey (WPC) reports 2024 investment volume of $1.6 billion
  • Yum! Brands (YUM) terminated its franchise agreements with franchisee IS Gida A.S.
  • Zentek's (ZTEK) Albany Graphite achieved a preliminary five-nines purity of 99.9991% directly from a larger Albany graphite deposit flotation concentrate sample

Ratings Changes (see Upgrades/Downgrades calendar for full list):

• Upgrades:
  • Accenture (ACN) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $425
  • Aon (AON) upgraded to Outperform from In-line at Evercore ISI; tgt raised to $420
  • Arthur J. Gallagher (AJG) upgraded to Overweight from Neutral at Piper Sandler; tgt raised to $315
  • Autodesk (ADSK) upgraded to Overweight from Neutral at Piper Sandler; tgt raised to $357
  • BJ Restaurants (BJRI) upgraded to Hold from Underperform at Gordon Haskett; tgt $36
  • Canadian Pacific Kansas City Ltd. (CP) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $86
  • Cardinal Health (CAH) upgraded to Buy from Hold at TD Cowen; tgt raised to $144
  • Carvana (CVNA) upgraded to Buy from Neutral at Citigroup; tgt raised to $277
  • Coca-Cola (KO) upgraded to Buy from Hold at TD Cowen; tgt $75
  • Corpay (CPAY) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $420
  • Ferguson plc (FERG) upgraded to Buy from Underperform at BofA Securities; tgt raised to $225
  • Floor & Decor (FND) upgraded to Equal Weight from Underweight at Barclays; tgt raised to $91
  • GE HealthCare (GEHC) upgraded to Buy from Hold at Jefferies; tgt raised to $103
  • Globe Life (GL) upgraded to Outperform from In-line at Evercore ISI; tgt raised to $143
  • Hannon Armstrong Sust. Infr. (HASI) upgraded to Buy from Neutral at Citigroup; tgt $36
  • Health Catalyst (HCAT) upgraded to Overweight from Sector Weight at KeyBanc Capital Markets; tgt $9
  • L3Harris (LHX) upgraded to Outperform from Mkt Perform at Bernstein; tgt lowered to $267
  • Martin Marietta (MLM) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $563
  • McCormick (MKC) upgraded to Buy from Hold at TD Cowen; tgt raised to $90
  • Mohawk (MHK) upgraded to Outperform from Peer Perform at Wolfe Research; tgt $150
• Downgrades:
  • Adobe (ADBE) downgraded to Hold from Buy at Deutsche Bank; tgt lowered to $475
  • Advanced Micro Devices (AMD) downgraded to Reduce from Buy at HSBC Securities; tgt $110
  • American Intl (AIG) downgraded to Neutral from Buy at Goldman; tgt lowered to $79
  • Aris Water Solutions (ARIS) downgraded to Neutral from Buy at Citigroup; tgt raised to $26
  • Danone (DANOY) downgraded to Underperform from Hold at Jefferies
  • Dayforce (DAY) downgraded to Hold from Buy at Deutsche Bank; tgt lowered to $80
  • Federated Hermes (FHI) downgraded to Hold from Buy at Deutsche Bank; tgt lowered to $43
  • Ferguson plc (FERG) downgraded to Neutral from Buy at UBS; tgt lowered to $193
  • Fidelis Insurance Holdings Limited (FIHL) downgraded to Sell from Neutral at Goldman; tgt lowered to $16
  • Intercontinental Hotels Group (IHG) downgraded to Underweight from Equal-Weight at Morgan Stanley
  • JELD-WEN (JELD) downgraded to Neutral from Buy at UBS; tgt lowered to $9
  • Kimberly-Clark (KMB) downgraded to Hold from Buy at TD Cowen; tgt $145
  • Lennar (LEN) downgraded to Peer Perform from Outperform at Wolfe Research
  • WK Kellogg Co (KLG) downgraded to Sell from Hold at TD Cowen; tgt $16
• Others:
  • Altimmune (ALT) initiated with a Buy at Stifel; tgt $18
  • Axon (AXON) initiated with a Buy at TD Cowen; tgt $700
  • Beacon Roofing Supply (BECN) resumed with a Buy at Stifel; tgt $115
  • Builders FirstSource (BLDR) resumed with a Buy at Stifel; tgt $175
  • Context Therapeutics (CNTX) initiated with a Mkt Outperform at JMP Securities; tgt $4
  • Gambling.com Group Ltd. (GAMB) initiated with a Buy at The Benchmark Company; tgt $16
  • Levi Strauss (LEVI) initiated with an Overweight at Barclays; tgt $24
  • Lithia Motors (LAD) initiated with a Buy at The Benchmark Company; tgt $400
  • Structure Therapeutics (GPCR) initiated with a Buy at Stifel; tgt $50

• Econ Data (Thursday):
  • NYSE Closed for former President Carter's funeral
  • 14:00 ET: Treasury market early close
• Earnings:
  • Monday (Jan 6)
    • Pre-Market: CMC
    • After-Hours: None
  • Tuesday (Jan 7)
    • Pre-Market: APOG, LNN, RPM
    • After-Hours: AIR, AZZ, CALM, SLP
  • Wednesday (Jan 8)
    • Pre-Market: AYI, ACI, ANGO, HELE, MSM, RDUS, UNF
      
    • After-Hours: GBX, JEF, PENG
  • Thursday (Jan 9)
    • Pre-Market: SMPL
    • After-Hours: ACCD, KBH, PSMT
  • Friday (Jan 10)
    • Pre-Market: STZ, DAL, NEOG, SNX, TLRY, WBA
    • After-Hours: WDFC
General Motors: 5,000 members at GM's Arlington, TX assembly plant join UAW strike