DAILY MORNING CHAI

The S&P 500 futures trade 15 points, or 0.4%, above fair value at the end of a negative and indecisive week. The benchmark index will look to pare its 0.9% weekly decline today. Yesterday's recovery-minded trade has presumably been aided by news that Gilead Sciences (GILD 63.46, +2.79, +4.6%) had its remdesivir treatment for COVID-19 approved by the FDA. Stimulus talks, meanwhile, are ongoing but the prospects for an approved deal before the election are looking less likely. The prolonged stimulus talks haven't deterred bond investors from continuing to sell longer-dated Treasuries, which have sent yields higher for the seventh straight day. The 10-yr yield is up one basis point to 0.86%, while the 2-yr yield is flat at 0.15%. The U.S. Dollar Index is down 0.2% to 92.79. WTI crude futures are up 0.4% to $40.79/bbl. Separately, Dow components Intel (INTC 48.74, -5.16, -9.6%) and American Express (AXP 102.00, -2.79, -2.7%) are trading sharply lower (INTC much more than AXP) after underwhelming investors with their earnings reports. Shares of Intel are down nearly 10% in pre-market action. Today's economic data will be limited to the preliminary Markit Manufacturing and Services PMIs for October, which will be released at 9:45 a.m. ET. In U.S. Corporate news: Intel (INTC 48.74, -5.16): -9.6% despite reporting in-line results and issuing in-line guidance. American Express (AXP 102.00, -2.79): -2.7% after missing earnings estimates. Gilead Sciences (GILD 63.46, +2.79): +4.6% after confirming its remdesivir treatment for COVID-19 was approved by the FDA. Mattel (MAT 13.91, +0.99): +7.7% after beating top and bottom-line estimates. Capital One (COF 79.70, +2.95): +3.8% after beating top and bottom-line estimates and amid the curve-steepening activity, which bodes well for the net interest margins of banks. Reviewing overnight developments: Equity indices in the Asia-Pacific region ended the week on a mixed note. Japan's Nikkei: +0.2%, Hong Kong's Hang Seng: +0.5%, China's Shanghai Composite: -1.0%, India's Sensex: +0.4%, South Korea's Kospi: +0.2%, Australia's ASX All Ordinaries: -0.2%. In economic data: Japan's September National CPI -0.1% m/m (last -0.1%); 0.0% yr/yr (last 0.2%). September National Core CPI -0.3% yr/yr (expected -0.4%; last -0.4%). October Manufacturing PMI 48.0 (last 47.7) and Services PMI 46.6 (last 46.9) Australia's October Manufacturing PMI 54.2 (last 55.4) and Services PMI 53.8 (last 50.8) New Zealand's Q3 CPI 0.7% qtr/qtr (expected 0.9%; last -0.5%); 1.4% yr/yr (expected 1.7%; last 1.5%) Singapore's September CPI 0.0% yr/yr (expected -0.3%; last -0.4%). Q3 URA Property Index 0.8% qtr/qtr (last 0.8%) In news: China's Commerce Ministry will impose temporary anti-dumping duties on some rubber imported from the U.S., South Korea, and the European Union. China's National People's Congress will start its fifth plenary session on Monday. Reports indicate that China's five-year plan will be discussed. Major European indices trade on a firmly higher note after the release of a better than expected flash October Manufacturing PMI report from Germany. STOXX Europe 600: +0.8%, Germany's DAX: +1.1%, U.K.'s FTSE 100: +1.5%, France's CAC 40: +1.3%, Italy's FTSE MIB: +1.0%, Spain's IBEX 35: +1.1%. In economic data: Eurozone's October flash Manufacturing PMI 54.4 (expected 53.1; last 53.7) and flash Services PMI 46.2 (expected 47.0; last 48.0) Germany's October flash Manufacturing PMI 58.0 (expected 55.1; last 56.4) and flash Services PMI 48.9 (expected 49.2; last 50.6) France's October flash Manufacturing PMI 51.0, as expected (last 51.2) and flash Services PMI 46.5 (expected 46.8; last 47.5) U.K.'s October flash Manufacturing PMI 53.3 (expected 54.3; last 54.1) and flash Services PMI 52.3 (expected 55.0; last 56.1). September Retail Sales 1.5% m/m (expected 0.4%; last 0.9%); 4.7% yr/yr (expected 3.7%; last 2.7%). September Core Retail Sales 1.6% m/m (expected 0.5%; last 0.6%); 6.4% yr/yr (expected 5.0%; last 4.3%) In news: French Finance Minister, Bruno Le Maire, said he expects France's Q4 GDP to be negative and that the cost of the coronavirus curfew will be about EUR2.00 bln. The Italian government is reportedly planning to impose a national curfew in a week if coronavirus cases continue climbing. U.S equity futures: S&P 500 Futures +11 @ 3460 DJIA Futures +86 @ 28354 Nasdaq Futures +23 @ 11672 Overseas: Europe: DAX +1.1%, FTSE +1.5%, CAC +1.3% Asia: Nikkei +0.2%, Hang Seng +0.5%, Shanghai -1.0% Commodities: Crude Oil +0.16 @ 40.80 Nat Gas -0.075 @ 2.932 Gold +9.05 @ 1913.65 Silver +0.161 @ 24.870 Copper -0.0043 @ 3.1492 U.S. Summary: Earnings/Guidance (Full Earnings Calendar): ABB Ltd (ABB) beats by $0.04, beats on revs Altra Industrial Motion (AIMC) beats by $0.41, beats on revs; raises FY20 EPS above consensus, revs above consensus American Express (AXP) misses by $0.05, reports revs in-line Ameris Bancorp (ABCB) beats by $0.80 Assoc Banc-Corp (ASB) beats by $0.01, misses on revs Autoliv (ALV) beats by $0.29, reports revs in-line; guides FY20 revs above consensus Bank OZK (OZK) beats by $0.25 Barclays (BCS) reports Q3 results Barnes Group (B) beats by $0.03, beats on revs; guides Q4 EPS in-line BJ Restaurants (BJRI) beats by $0.45, beats on revs Bloomin' Brands (BLMN) beats by $0.20, beats on revs Boston Beer Co (SAM) beats by $1.79, misses on revs; raises FY20 EPS guidance above consensus Capital One (COF) beats by $2.97, beats on revs Carter Holdings (CRI) beats by $0.39, misses on revs; not providing FY20 guidance Cleveland-Cliffs (CLF) beats by $0.10, misses on revs CoreLogic (CLGX) misses by $0.15, reports revs in-line; Expects FY 20 at Upper End of Guidance Range Daimler AG (DDAIF) reports Q3 results; sales down 7% yr/yr DMC Global (BOOM) beats by $0.18, beats on revs; guides Q4 revs above consensus eHealth (EHTH) beats by $0.26, beats on revs; reaffirms FY20 EPS guidance, revs guidance Employers Holdings (EIG) beats by $0.07, beats on revs Everest Re (RE) estimates pre-tax net catastrophe losses of $300 mln for Q3 First Financial (FFIN) beats by $0.05 First Horizon (FHN) beats by $0.12 Greenbrier (GBX) misses by $0.14, beats on revs Independent Bank (INDB) reports Q3 results Intel (INTC) reports EPS in-line, revs in-line; guides Q4 EPS in-line, revs in-line, DCG's Enterprise & Govt segment revs down 47%, co guides to sequential decline in non-GAAP op mgn Limelight Networks (LLNW) misses by $0.03, reports revs in-line; guides FY20 EPS in-line, reaffirms FY20 revs guidance Manhattan Assoc (MANH) beats by $0.12, beats on revs; raises FY20 EPS and revs guidance above consensus Mattel (MAT) beats by $0.57, beats on revs; to give full year guidance on the call NextGen Healthcare (NXGN) beats by $0.10, beats on revs; guides FY21 EPS above consensus, revs in-line People's United Financial (PBCT) beats by $0.05, misses on revs POSCO (PKX) reports Q3 results; revs in-line; sees FY20 revs below consensus Robert Half (RHI) beats by $0.08, beats on revs Seagate Tech (STX) beats by $0.03, misses on revs; guides Q2 EPS in-line, revs in-line; increases dividend and buyback authorization SVB Financial Group (SIVB) beats by $3.23 Triton International (TRTN) beats by $0.08, misses on revs; guides Q4 EPS above consensus Veoneer (VNE) reports Q3 results; expects this organic growth to accelerate into FY21 VeriSign (VRSN) beats by $0.14, reports revs in-line Vicor (VICR) beats by $0.03, beats on revs U.S. Xpress (USX) reports Q3 results, misses Q3 estimates Western Alliance Bancorp (WAL) beats by $0.32, misses on revs General News: Prospects for a stimulus package before the election are fading amid continued talks, according to Bloomberg President Trump and Joe Biden debated coronavirus, climate change, healthcare, and other topics during last night's debate, according to the New York Times Chicago to close bars for indoor service for at least two weeks due to coronavirus, according to NBC News ACI Worldwide (ACIW): Starboard Value CEO Jeffrey Smith says ACI Worldwide is an "attractive" takeover target, according to Reuters Akebia Therapeutics (AKBA) presents results from INNO2VATE global Phase 3 program Aurinia Pharma (AUPH) announces integrated efficacy and pharmacokinetic data from Aurinia's AURA-LV and AURORA pivotal trials of voclosporin in lupus nephritis Bancolombia S.A. (CIB) and the unions, Uneb and Sintrabancol, entered into a new collective bargaining agreement BCB Bancorp (BCBP) approves new stock repurchase program CureVac (CVAC) announces data from preclinical studies of its investigational SARS-CoV-2 vaccine candidate, CVnCoV, in mice and hamsters Equinor CFO (EQNR) resigns; appoints Svein Skeie as CFO Facebook (FB): Federal Trade Commission staff members want Facebook antitrust lawsuit, according to the Wall Street Journal Fortress Transportation and Infrastructure (FTAI) to collaborate with Lockheet Martin (LMT) on The Module Factory fuboTV (FUBO) rolls out updated Multiview feature on Apple TV (AAPL) Gilead Sciences (GILD) confirms FDA approval of Veklury (remdesivir) for the treatment of COVID-19 Howard Hughes (HHC) announces comprehensive proposal for Lower Manhattan's Seaport area Innate Pharma (IPHA) doses first patient in Monalizumab Phase 3 clinical trial; triggers milestone payment Kezar Life Sciences (KZR) granted FDA Orphan Drug Designations for KZR-616 for the treatment of polymyositis and dermatomyositis Microsoft (MSFT): Minecraft will now require a Microsoft account to play Nexstar Media (NXST) announces strategic operational realignment Palantir Technologies (PLTR) will help track coronavirus vaccine distribution, according to the Wall Street Journal PayPal (PYPL) is exploring acquisitions of cryptocurrency companies including Bitcoin custodian BitGo, according to Bloomberg Scorpio Bulkers (SALT) agrees to sell Ultramax bulk carrier SBI Hyperion for approx. $17.5 mln Simmons First National (SFNC) announces resumption of previously-approved stock repurchase program Tesla (TSLA) plans to add a new 4D radar with twice the range to help its self-driving effort, according to Electrek Tesla (TSLA) to recall 30,000 vehicles in China, according to Bloomberg Uber (UBER) drivers sue the company for $260 mln for alleged violation of employment rights, according to the Washington Post Uber (UBER): California appeals court says Uber and Lyft (LYFT) must classify drivers as employees, according to the Wall Street Journal Volaris Aviation (VLRS) misses on top and bottom lines Walmart (WMT) sues US Department of Justice and Drug Enforcement Administration seeking clarity for pharmacists in dispensing prescription opioids Wells Fargo (WFC) mulling sale of asset management unit, according to Reuters West Pharm (WST) announces FDA 510(k) clearance and launch of Vial2Bag Advanced 20mm Admixture Device M&A: Atkore International (ATKR) acquires assets of Queen City Plastics CONSOL Energy (CEIX) acquires remaining stake in CONSOL Coal Resources (CCR) Retrophin (RTRX) enters into a definitive agreement to acquire Orphan Technologies Limited Syndicate: Logitech Int'l SA (LOGI) files to sell approx. 390K shares by selling shareholders Milestone Pharmaceuticals (MIST) announces public offering of common shares and pre-funded warrants IPOs: Priced to Trade: Foghorn Therapeutics (Nasdaq: FHTC): The developer of a new class of medicines targeting genetically determined dependencies within the chromatin priced its 7.5 M share IPO at $16, the mid-point of the $15-$17 expected price range. Gapping Up/Down Gapping up: IPHA +11.1%, SAM +8.9%, MAT +8.3%, FFBC +8.3%, BOOM +6.6%, BCS +6.2%, GILD +5.7%, CNX +5%, ABCB +4.8%, COF +3.3%, NXGN +3%, AUPH +2.4%, VICR +2.3%, FUBO +2%, PBCT +2%, PKX +2%, WAL +1.9%, AKBA +1.8%, ASB +1.8%, GBX +1.7%, VLRS +1.6%, FTAI +1.4%, SIVB +1.4%, HHC +1.3%, HAS +1.3%, ZUO +1.2%, AMD +1.1%, PYPL +0.9% Gapping down: MIST -15.9%, USX -14.1%, LLNW -13.2%, EHTH -11.6%, CYBE -11.4%, INTC -9.5%, SFNC -7.9%, MANH -6.3%, ABB -3.4%, STX -2.8%, VRSN -2.8%, RHI -2.3%, BJRI -2%, WDC -1.8%, CLGX -1.5%, LOGI -1.1% Analyst Research (see Upgrades/Downgrades calendarfor full list): Upgrades: CarGurus (CARG) upgraded to Buy from Neutral at BTIG Research; tgt $26 EOG Resources (EOG) upgraded to Overweight from Neutral at Piper Sandler; tgt $51 Fifth Third (FITB) upgraded to Buy from Neutral at Janney; tgt $28.75 F5 Networks (FFIV) upgraded to Buy from Neutral at MKM Partners; tgt raised to $170 Motorola Solutions (MSI) upgraded to Buy from Neutral at MKM Partners; tgt raised to $199 Pioneer Natural Resources (PXD) upgraded to Overweight from Neutral at Piper Sandler; tgt lowered to $106 PulteGroup (PHM) upgraded to Outperform from Sector Perform at RBC Capital Mkts; tgt raised to $53 PulteGroup (PHM) upgraded to Positive from Neutral at Susquehanna; tgt $54 Reliance Steel (RS) upgraded to Buy from Neutral at BofA Securities; tgt $123 Seagate Tech (STX) upgraded to Buy from Hold at The Benchmark Company; tgt $60 Spire (SR) upgraded to Outperform from Neutral at Credit Suisse; tgt $68 StoneCo (STNE) upgraded to Positive from Neutral at Susquehanna; tgt $68 TRI Pointe Homes (TPH) upgraded to Buy from Neutral at B. Riley Securities; tgt raised to $27 Whirlpool (WHR) upgraded to Sector Perform from Underperform at RBC Capital Mkts; tgt raised to $183 Downgrades: Citrix Systems (CTXS) downgraded to Equal-Weight from Overweight at Morgan Stanley; tgt $140 Fastly (FSLY) downgraded to Underweight from Neutral at Piper Sandler; tgt lowered to $65 Intel (INTC) downgraded to Underperform from Neutral at BofA Securities; tgt lowered to $45 Navistar (NAV) downgraded to Hold from Buy at Jefferies; tgt $44.50 Sonoco Products (SON) downgraded to Neutral from Buy at BofA Securities; tgt $57 TAL Education (TAL) downgraded to Neutral from Overweight at JP Morgan; tgt $75 Others: Amwell (AMWL) initiated with a Neutral at Guggenheim A.O. Smith (AOS) initiated with a Neutral at Citigroup; tgt $59 AxoGen (AXGN) initiated with a Buy at Guggenheim; tgt $24 BigCommerce (BIGC) initiated with a Neutral at Wedbush; tgt $90 Cassava Sciences (SAVA) initiated with an Overweight at Cantor Fitzgerald; tgt $24 Crescent Capital BDC (CCAP) initiated with a Neutral at Janney CRISPR Therapeutics (CRSP) initiated with a Sector Perform at RBC Capital Mkts; tgt $110 CTI BioPharma (CTIC) initiated with a Buy at Brookline HealthEquity (HQY) initiated with an Outperform at RBC Capital Mkts; tgt $67 Hycroft Mining (HYMC) initiated with a Buy at Stifel; tgt $15 MeiraGTx (MGTX) initiated with an Outperform at RBC Capital Mkts; tgt $27 Nevro (NVRO) initiated with a Buy at Guggenheim; tgt $190 Progenity (PROG) initiated with a Buy at BTIG Research; tgt $12 Prudential Plc (PUK) initiated with an Underperform at Exane BNP Paribas Shake Shack (SHAK) initiated with an Outperform at Oppenheimer; tgt $90 Shutterstock (SSTK) initiated with a Mkt Outperform at JMP Securities; tgt $72 uniQure (QURE) initiated with an Outperform at RBC Capital Mkts; tgt $61 Virgin Galactic (SPCE) initiated with a Neutral at Goldman; tgt $19 WAVE Life Sciences (WVE) initiated with a Sector Perform at RBC Capital Mkts; tgt $13 Upcoming Events: Econ Data: 09:45 ET: Markit Manufacturing PMI - Prelim for October (Briefing.com Consensus NA; Prior 53.2) 09:45 ET: Markit Services PMI - Prelim for October (Briefing.com Consensus NA; Prior 54.6) Earnings: Monday (Oct 19) Pre-Market: HAL, LII, PHG After-Hours: CDNS, HXL, IBM, LOGI, PPG, STLD, ZION Tuesday (Oct 20) Pre-Market: ACI, CP, CMA, DOV, LMT, MAN, NVR, PCAR, PNR, PM, PG, PLD, RF, SYF, TRV, UBS After-Hours: CNI, IBKR, IRBT, NAVI, NFLX, SNAP, THC, TER, TXN, USNA, WRB, WDFC Wednesday (Oct 21) Pre-Market: ABT, APH, AN, AVY, BKR, BIIB, ERIC, IPG, KEY, KNX, LAD, MANU, NDAQ, NEE, NTRS, TMO, VZ, WGO After-Hours: ALGN, CMG, CNS, CCI, CSX, DFS, EW, EFX, KALU, KMI, LRCX, LSTR, LVS, MTH, NTGR, SLM, FTI, TSLA, TRN, WHR, XLNX Thursday (Oct 22) Pre-Market: ALK, AB, AAL, ARCH, T, CHKP, CTXS, KO, DHR, DOW, EQT, FITB, FCX, GPC, GWW, HBAN, KMB, LNN, MTB, NOC, NUE, PTEN, PAG, POOL, PHM, DGX, RS, SIRI, SNA, SON, LUV, STM, TSCO, TPH, UNP, VLO After-Hours: OZK, BJRI, SAM, COF, EHTH, FE, INTC, MANH, MAT, NXGN, RHI, STX, VRSN Friday (Oct 23) Pre-Market: ABB, AXP, B, BLMN, CLF, FHN, GNTX, GBX, ITW After-Hours: None of note Asia & Europe detail: Asia: Nikkei +0.2%, Hang Seng +0.5%, Shanghai -1.0% Equity indices in the Asia-Pacific region ended the week on a mixed note. China's Commerce Ministry will impose temporary anti-dumping duties on some rubber imported from the U.S., South Korea, and the European Union. China's National People's Congress will start its fifth plenary session on Monday. Reports indicate that China's five-year plan will be discussed. In economic data: Japan's September National CPI -0.1% m/m (last -0.1%); 0.0% yr/yr (last 0.2%). September National Core CPI -0.3% yr/yr (expected -0.4%; last -0.4%). October Manufacturing PMI 48.0 (last 47.7) and Services PMI 46.6 (last 46.9) Australia's October Manufacturing PMI 54.2 (last 55.4) and Services PMI 53.8 (last 50.8) New Zealand's Q3 CPI 0.7% qtr/qtr (expected 0.9%; last -0.5%); 1.4% yr/yr (expected 1.7%; last 1.5%) Singapore's September CPI 0.0% yr/yr (expected -0.3%; last -0.4%). Q3 URA Property Index 0.8% qtr/qtr (last 0.8%) ---Equity Markets--- Japan's Nikkei: +0.2% (+0.5% for the week) Hong Kong's Hang Seng: +0.5% (+2.2% for the week) China's Shanghai Composite: -1.0% (-1.8% for the week) India's Sensex: +0.4% (+0.3% for the week) South Korea's Kospi: +0.2% (+0.8% for the week) Australia's ASX All Ordinaries: -0.2% (-0.2% for the week) ---FX--- USD/JPY: -0.1% to 104.69 USD/CNH: -0.2% to 6.6505 USD/INR: UNCH at 73.65 Europe: DAX +1.1%, FTSE +1.5%, CAC +1.3% Major European indices trade on a firmly higher note after the release of a better than expected flash October Manufacturing PMI report from Germany. French Finance Minister, Bruno Le Maire, said he expects France's Q4 GDP to be negative and that the cost of the coronavirus curfew will be about EUR2.00 bln. The Italian government is reportedly planning to impose a national curfew in a week if coronavirus cases continue climbing. In economic data: Eurozone's October flash Manufacturing PMI 54.4 (expected 53.1; last 53.7) and flash Services PMI 46.2 (expected 47.0; last 48.0) Germany's October flash Manufacturing PMI 58.0 (expected 55.1; last 56.4) and flash Services PMI 48.9 (expected 49.2; last 50.6) France's October flash Manufacturing PMI 51.0, as expected (last 51.2) and flash Services PMI 46.5 (expected 46.8; last 47.5) U.K.'s October flash Manufacturing PMI 53.3 (expected 54.3; last 54.1) and flash Services PMI 52.3 (expected 55.0; last 56.1). September Retail Sales 1.5% m/m (expected 0.4%; last 0.9%); 4.7% yr/yr (expected 3.7%; last 2.7%). September Core Retail Sales 1.6% m/m (expected 0.5%; last 0.6%); 6.4% yr/yr (expected 5.0%; last 4.3%) ---Equity Markets--- STOXX Europe 600: +0.8% (-1.2% week-to-date) Germany's DAX: +1.1% (-1.8% week-to-date) U.K.'s FTSE 100: +1.5% (-0.8% week-to-date) France's CAC 40: +1.3% (-0.5% week-to-date) Italy's FTSE MIB: +1.0% (-0.6% week-to-date) Spain's IBEX 35: +1.1% (+0.3% week-to-date) ---FX--- EUR/USD: +0.2% to 1.1847 GBP/USD: -0.1% to 1.3069 USD/CHF: -0.3% to 0.9042