Daily morning briefing

The S&P 500 futures are trading 14 points, or 0.4%, below fair value, suggesting the market is on track for its fourth straight weekly decline. The S&P 500 enters the session down 2.2% this week amid a host of uncertainties and downwards momentum. Some of those uncertainties pertain to the political sphere, specifically regarding the dimming hopes for another relief bill before the election and the likelihood that the election results are delayed. According to a recent Bloomberg report, Goldman Sachs believes markets are overstating the risk from a delayed election result. There aren't any new macro factors this morning, although month-end and quarter-end rebalancing could contribute to the recent volatility in the market. Separately, today's economic data will be limited to Durable Goods Orders for August (Briefing.com consensus 0.9%), which will be available at 8:30 a.m. ET. U.S. Treasuries continue to sit relatively unchanged. The 2-yr yield is flat at 0.13%, and the 10-yr yield is down one basis point to 0.66%. The U.S. Dollar Index is up 0.2% to 94.56. WTI crude futures are down 0.9%, or $0.36, to $39.95/bbl. In U.S. Corporate news: Costco (COST 337.95, 9.05): -2.6% despite beating earnings estimates. Palantir (PLTR, private): expected to fetch a $22 billion valuation when it goes public via direct listing, according to The Wall Street Journal. Reviewing overnight developments: Equity indices in the Asia-Pacific region ended the week on a mostly higher note. Japan's Nikkei: +0.5%, Hong Kong's Hang Seng: -0.3%, China's Shanghai Composite: -0.1%, India's Sensex: +2.3%, South Korea's Kospi: +0.3%, Australia's ASX All Ordinaries: +1.4%. In economic data: Japan's August Corporate Services Price Index 1.0% (last 1.1%) South Korea's September Consumer Confidence 79.4 (last 88.2) Singapore's August Industrial Production 13.9% m/m (expected 2.6%; last 2.3%); 13.7% yr/yr (expected 4.6%; last -7.6%) In news: Japan's government is reportedly considering tax cuts for small and medium enterprises. Toyota is set to boost its domestic production in October and November. FTSE Russell announced that Chinese government bonds will be included in Russell's Global Bond Index near the end of next year. Australian banks will reportedly relax their lending standards. Major European indices trade in negative territory. STOXX Europe 600: -1.0%, Germany's DAX: -1.8%, U.K.'s FTSE 100: -0.6%, France's CAC 40: -1.8%, Italy's FTSE MIB: -1.5%, Spain's IBEX 35: -1.0%. In economic data: Eurozone's August M3 Money Supply 9.5% yr/yr (expected 10.2%; last 10.1%) and Private Sector Loans 3.0% yr/yr (last 3.0%) U.K.'s August Public Sector Net Borrowing GBP35.20 bln (expected GBP35.05 bln; last GBP14.72 bln) Italy's September Business Confidence 92.1 (expected 87.5; last 87.1) and Consumer Confidence 103.4 (expected 100.8; last 101.0) Spain's August PPI -3.5% yr/yr (last -4.8%) In news: European Central Bank member, Francois Villeroy de Galhau, reiterated that inflation was too low, but the central bank has more room to maneuver. Irish Foreign Minister, Simon Coveney, expressed hope that the U.K. and EU can still reach a trade deal. European Commission President, Ursula von der Leyen, urged EU leaders to complete the region's banking and capital markets union. U.S equity futures: S&P 500 Futures -13 @ 3225 DJIA Futures -133 @ 26582 Nasdaq Futures -9 @ 10883 Overseas: Europe: DAX -1.8%, FTSE -0.6%, CAC -1.8% Asia: Nikkei +0.5%, Hang Seng -0.3%, Shanghai -0.1% Commodities: Crude Oil -0.36 @ 39.95 Nat Gas -0.065 @ 2.183 Gold -14.55 @ 1862.35 Silver -0.291 @ 22.905 Copper -0.0118 @ 2.9562 U.S. Summary: Earnings/Guidance (Full Earnings Calendar): AAR Corp (AIR) beats by $0.22, beats on revs Avient (AVNT) issues upside Q3 EPS guidance, expects to generate $80 mln of free cash flow during quarter CalAmp (CAMP) misses by $0.03, beats on revs Costco (COST) beats EPS consensus estimate, reports revs in-line with prior guidance, total company comps up 14.1% Dynavax (DVAX) announces planned retirement of CFO Michael Ostrach, effective in 2021 Fluor (FLR) reports FY19 results; misses on revs Scholastic Corp (SCHL) beats single est by $0.58, misses on revs Trip.com Group (TCOM) beats by US$0.16, beats on revs; guides Q3 revs below consensus Vail Resorts (MTN) misses by $0.29, misses on revs General News: Senate will vote on continuing resolution next week to fund government through December 11, according to The Hill House Speaker Nancy Pelosi (D-CA) introduced yesterday's $2.4 trillion stimulus bill to form a basis for renewed talks amid continuing pressure from moderate Democrats in her caucus, according to the Washington Post Congress is skeptical that any stimulus deal can be reached before November election despite new $2.4 trillion offer, according to Bloomberg Goldman Sachs believes markets are overstating risk from a delayed election result, according to Bloomberg President Trump will send Americans on Medicare a $200 discount card for prescription drugs, according to Bloomberg Republicans on Senate Commerce Committee are expected to subpoena testimony from Google (GOOG), Facebook (FB), and Twitter (TWTR), according to the Wall Street Journal President Trump asks judge to allow WeChat ban to proceed, according to Bloomberg PAC-12 will begin football season on November 6, according to ESPN Air France-KLM (AFLYY) to step up labor talks in advance of deadline to qualify for government bailout funds in the Netherlands, according to Bloomberg AstraZenaca (AZN): European governments will pay claims above a certain limited related to AstraZeneca coronavirus vaccine, according to Reuters BMW Group (BMWYY): SEC charges BMW AG for disclosing inaccurate and misleading retail sales information to bond investors Boeing (BA) awarded $2.24 bln Air Force contract Bristol-Myers (BMY): Phase 3 CheckMate -274 trial met primary endpoints of improving disease-free survival vs placebo Canadian Solar (CSIQ) comments on ITC complaint filed by Solaria Corporation; says none of the products at issue in the case infringe the Solaria patents Colony Capital (CLNY) to sell six of its hospitality portfolios Dr. Reddy's (RDY) launches generic Precedex in the US Endo Intl (ENDP) enters into a non-exclusive agreement with Novavax (NVAX) to provide fill-finish manufacturing services Novavax' COVID-19 vaccine candidate First Busey (BUSE) files mixed securities shelf offering First Majestic Silver (AG) provides SAT tax dispute update Freshpet (FRPT) names Heather Pomerantz as CFO Gilead Sciences (GILD) and Galapagos (GLPG) receive approval for Jyseleca in Japan IGM Biosciences (IGMS) and AbCellera announce multi-year antibody discovery collaboration JBT Corp (JBT): CEO Tom Giacomini is stepping down to focus on his health and recovery Johnson Outdoors (JOUT) raises class A quarterly dividend to $0.21/share from $0.17/share prior dividend Luminex (LMNX) receives BARDA award to support 510(k) filing for NxTAG Respiratory Pathogen Panel Marinus Pharmaceuticals (MRNS) provides update on Phase 3 RAISE trial MSCI (MSCI) announces the appointment of Andrew Wiechmann as CFO, effective immediately Norwegian Cruise Line (NCLH) announces new world cruise opening day booking record for Regent Seven Seas Cruises' 2023 World Cruise Novavax (NVAX) initiates Phase 3 efficacy trial of COVID-19 vaccine in the United Kingdom; to enroll up to 10,000 volunteers Oceaneering Intl (OII) announces realigned business operating segments Palantir (PLTR) is expected to be valued at $22 bln, according to the Wall Street Journal Parsons (PSN) receives $45 mln contract in support of new BART Train Control system Radius Health (RDUS) provides update on Phase 3 EMERALD trial for elacestrant Scorpio Tankers (STNG) reports the open market purchase of 100K common shares at $10.79 and 2000 April 2021 $12 Calls by co's President Scorpio Tankers (STNG) provides financing updates TELA Bio (TELA) presents additional data from BRAVO study of OviTex for ventral hernia repair M&A: ProSight Global (PROS): Former CEO of Validus' US insurance ops and Towerbrook may bid on PROS, citing sources, according to InsuranceInsider.com Syndicate: EPAM Systems (EPAM) files mixed securities shelf offering First Capital (FCAP) files for $35 mln mixed securities shelf offering Nutanix (NTNX) files for 40,229,465 share common stock offering by selling shareholders, relates to a convertible notes offering IPOs: Expected to Price: Orphazyne (Nasdaq: ORPH): The late-stage biopharmaceutical company harnessing the amplification of Heat Shock Proteins to develop therapeutics for the treatment of neurodegenerative orphan diseases is expected to price its 7.6 M share IPO between $13-$14. Priced to Trade: Graybug Vision (Nasdaq: GRAY): The clinical-stage biopharmaceutical company developing medicines for treatment of diseases of the retina and optic nerve priced its upsized 5.625 M share IPO at $16.00 per share, in-line with the expected range of $15-17. The IPO was originally expected to consist of 4.7 M shares. PMV Pharmaceuticals (Nasdaq: PVMP): The precision oncology company developing small molecule, tumor-agnostic therapies targeting p53 mutations priced its upsized 11.765 M share IPO at $18.00 per share, at the high end of the expected range of $16-18. The IPO was originally expected to consist of 7.4 M shares. Gapping Up/Down Gapping up: CLNY +21.8%, PROS +15.4%, TELA +11.3%, ENDP +9.6%, NVAX +7.1%, ALT +6.4%, SAVA +5.3%, RDUS +5.3%, MRNS +5.1%, AVNT +4.6%, DVAX +4.2%, CVGI +4%, STNG +2.7%, GLPG +2.3%, CAMP +2%, LMNX +1.6%, AIR +1.6%, BMY +1.5% Gapping down: FLR -4.8%, COST -2.7%, IGMS -2.6%, OHI -2.5%, SCHL -2.3%, IGT -1.8%, EPAM -1.2% Analyst Research (see Upgrades/Downgrades calendarfor full list): Upgrades: 89bio (ETNB) upgraded to Buy from Neutral at BofA Securities; tgt raised to $43 Banco Macro (BMA) upgraded to Buy from Reduce at HSBC Securities Cardinal Health (CAH) upgraded to Buy from Hold at Deutsche Bank; tgt $61 Coty (COTY) upgraded to Neutral from Sell at Citigroup; tgt raised to $3.25 CSX (CSX) upgraded to Buy from Hold at The Benchmark Company; tgt $95 Fifth Third (FITB) upgraded to Overweight from Equal-Weight at Morgan Stanley; tgt raised to $30 General Mills (GIS) upgraded to Outperform from Neutral at Credit Suisse; tgt raised to $67 Norfolk Southern (NSC) upgraded to Buy from Hold at The Benchmark Company; tgt $250 ONE Gas (OGS) upgraded to Buy from Neutral at Mizuho; tgt lowered to $80 OUTFRONT Media (OUT) upgraded to Buy from Neutral at Citigroup; tgt raised to $18 Owens & Minor (OMI) upgraded to Equal Weight from Underweight at Barclays; tgt $20 Plains All American (PAA) upgraded to Overweight from Underweight at Morgan Stanley Plains GP (PAGP) upgraded to Overweight from Underweight at Morgan Stanley Rocket Companies (RKT) upgraded to Neutral from Negative at Susquehanna; tgt $20 Splunk (SPLK) upgraded to Outperform from Neutral at Robert W. Baird; tgt $240 Targa Resources (TRGP) upgraded to Overweight from Underweight at Morgan Stanley; tgt $18 Others: Amazon (AMZN) resumed with an Overweight at Piper Sandler; tgt $3860 ANGI Homeservices (ANGI) initiated with a Neutral at Piper Sandler; tgt $12 Axcella Health (AXLA) initiated with a Buy at B. Riley FBR; tgt $14 Bonanza Creek Energy (BCEI) initiated with an Overweight at Wells Fargo; tgt $33 Booking Holdings (BKNG) resumed with a Neutral at Piper Sandler; tgt $1721 Callon Petroleum (CPE) initiated with an Underweight at Wells Fargo; tgt $4 ConocoPhillips (COP) initiated with an Overweight at KeyBanc Capital Markets Datadog (DDOG) initiated with a Neutral at Robert W. Baird; tgt $92 Dynatrace (DT) initiated with an Outperform at Robert W. Baird; tgt $50 eBay (EBAY) resumed with an Overweight at Piper Sandler; tgt $65 eHealth (EHTH) initiated with a Buy at Goldman; tgt $101 Elastic (ESTC) initiated with a Neutral at Robert W. Baird; tgt $120 Enable Midstream Partners (ENBL) initiated with an Underweight at Morgan Stanley; tgt $3 Equitrans Midstream (ETRN) initiated with an Equal-Weight at Morgan Stanley; tgt $10 Expedia Group (EXPE) resumed with a Neutral at Piper Sandler; tgt $102 Hess Midstream Partners (HESM) initiated with an Equal-Weight at Morgan Stanley; tgt $18 Hexcel (HXL) initiated with a Hold at Truist; tgt $31 InterActiveCorp (IAC) resumed with an Overweight at Piper Sandler; tgt $145 Northern Oil & Gas (NOG) initiated with an Overweight at Wells Fargo; tgt $10 Ontrak (OTRK) initiated with a Buy at The Benchmark Company; tgt $100 Redfin (RDFN) resumed with an Overweight at Piper Sandler; tgt $56 Sandstorm Gold (SAND) initiated with a Buy at H.C. Wainwright; tgt $14 Tufin Software (TUFN) initiated with a Neutral at Robert W. Baird; tgt $10 Unity Software (U) initiated with a Buy at DA Davidson; tgt $100 Zillow (ZG) resumed with an Overweight at Piper Sandler; tgt $112 Upcoming Events: Econ Data: 08:30 ET: Durable Orders for August (Briefing.com Consensus 0.9%; Prior 11.2%) 08:30 ET: Durable Orders ex-transportation for August (Briefing.com Consensus 1.0%; Prior 2.4%) Asia & Europe detail: Asia: Nikkei +0.5%, Hang Seng -0.3%, Shanghai -0.1% Equity indices in the Asia-Pacific region ended the week on a mostly higher note. Japan's government is reportedly considering tax cuts for small and medium enterprises. Toyota is set to boost its domestic production in October and November. FTSE Russell announced that Chinese government bonds will be included in Russell's Global Bond Index near the end of next year. Australian banks will reportedly relax their lending standards. In economic data: Japan's August Corporate Services Price Index 1.0% (last 1.1%) South Korea's September Consumer Confidence 79.4 (last 88.2) Singapore's August Industrial Production 13.9% m/m (expected 2.6%; last 2.3%); 13.7% yr/yr (expected 4.6%; last -7.6%) ---Equity Markets--- Japan's Nikkei: +0.5% (-0.7% for the week) Hong Kong's Hang Seng: -0.3% (-5.0% for the week) China's Shanghai Composite: -0.1% (-3.6% for the week) India's Sensex: +2.3% (-3.8% for the week) South Korea's Kospi: +0.3% (-5.5% for the week) Australia's ASX All Ordinaries: +1.4% (+1.4% for the week) ---FX--- USD/JPY: +0.1% to 105.45 USD/CNH: +0.2% to 6.8340 USD/INR: -0.3% to 73.71 Europe: DAX -1.8%, FTSE -0.6%, CAC -1.8% Major European indices trade in negative territory. European Central Bank member, Francois Villeroy de Galhau, reiterated that inflation was too low, but the central bank has more room to maneuver. Irish Foreign Minister, Simon Coveney, expressed hope that the U.K. and EU can still reach a trade deal. European Commission President, Ursula von der Leyen, urged EU leaders to complete the region's banking and capital markets union. In economic data: Eurozone's August M3 Money Supply 9.5% yr/yr (expected 10.2%; last 10.1%) and Private Sector Loans 3.0% yr/yr (last 3.0%) U.K.'s August Public Sector Net Borrowing GBP35.20 bln (expected GBP35.05 bln; last GBP14.72 bln) Italy's September Business Confidence 92.1 (expected 87.5; last 87.1) and Consumer Confidence 103.4 (expected 100.8; last 101.0) Spain's August PPI -3.5% yr/yr (last -4.8%) ---Equity Markets--- STOXX Europe 600: -1.0% (-4.5% week-to-date) Germany's DAX: -1.8% (-5.6% week-to-date) U.K.'s FTSE 100: -0.6% (-3.7% week-to-date) France's CAC 40: -1.8% (-6.0% week-to-date) Italy's FTSE MIB: -1.5% (-4.6% week-to-date) Spain's IBEX 35: -1.0% (-5.1% week-to-date) ---FX--- EUR/USD: -0.3% to 1.1636 GBP/USD: -0.3% to 1.2704 USD/CHF: +0.3% to 0.9283