DAILY MORNING CHAI REPORT

 The S&P 500 futures trade 14 points, or 0.4%, above fair value to recover overnight losses, as investors buy the dip and continue to take good news in stride.

Briefly, Pfizer (PFE 37.24, +1.20, +3.3%) and BioNTech (BNTX 73.70, +6.77, +7.8%) clarified that their COVID-19 is 95% effective, Boeing (BA 221.94, +11.89, +5.7%) received FAA approval for the 737 MAX to fly again, and Target (TGT 167.35, +4.31, +2.6%) delivered a strong Q3 earnings report.

More generally, though, the market continues to brush aside the surging coronavirus cases in the U.S., and the corresponding business restrictions, on optimism that a vaccine and stimulus will revive the economy next year. This part of the bull market has seen new leadership from the cyclical, value, and small-cap stocks.

On the data front, investors will receive Housing Starts (Briefing.com consensus 1.445 million) and Building Permits (Briefing.com consensus 1.550 million) for October at 8:30 a.m. ET. The weekly MBA Mortgage Applications Index decreased 0.3% following a 0.5% decline in the prior week.

U.S. Treasuries trade near their flat lines following a modest advance yesterday. The 2-yr yield is up one basis point to 0.17%, and the 10-yr yield is flat at 0.87%. The U.S. Dollar Index is down 0.1% to 92.36. WTI crude futures are up 2.2%, or $0.89, to $42.32/bbl.

In U.S. Corporate news:

Pfizer (PFE 37.24, +1.20): +3.3% after concluding its Phase 3 COVID-19 study with BioNTech (BNTX 73.70, +6.77, +7.8%), indicating that their vaccine was 95% effective and plan to file for emergency use authorization. Recall, last Monday they said interim data indicated their vaccine was more than 90% effective.

Boeing (BA 221.94, +11.89): +5.7% after the FAA approved the 737 MAX to fly again. BA shares are up 45% this month, not including today's pre-market gain.

Lowe's (LOW 149.97, -9.89): -6.2% despite beating top and bottom-line estimates, although the low-end of its Q4 EPS guidance range was slightly below consensus.

Target (TGT 167.35, +4.31): +2.6% after beating top and bottom-line estimates and lifting its share repurchase suspension.

TJX Co. (TJX 62.78, +1.64): +2.7% after beating top and bottom-line estimates.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region ended Wednesday on a mostly higher note. Japan's Nikkei: -1.1%, Hong Kong's Hang Seng: +0.5%, China's Shanghai Composite: +0.2%, India's Sensex: +0.5%, South Korea's Kospi: +0.3%, Australia's ASX All Ordinaries: +0.4%.

In economic data:

Japan's October trade surplus JPY872.90 bln (expected surplus of JPY250.00 bln; last surplus of JPY687.80 bln). October Imports -13.3% yr/yr (expected -9.0%; last -17.4%) and Exports -0.2% yr/yr (expected -4.5%; last -4.9%)

Australia's Q3 Wage Price Index 0.1% qtr/qtr (expected 0.2%; last 0.2%); 1.4% yr/yr (expected 1.5%; last 1.8%). October HIA New Home Sales -1.3% m/m (last 3.8%)

New Zealand's Q3 Input PPI 0.6% qtr/qtr (last -0.9%) and Output PPI -0.3% qtr/qtr (last -0.3%)

In news:

Australia reported its worst wage growth on record in Q3. Reserve Bank of Australia Governor, Philip Lowe, said that while the economy is recovering, the pace has been uneven.

China is preparing to sell euro-denominated debt in three tranches. Bank of Korea sold more money stabilization bonds than planned.

Bank of Japan Governor, Haruhiko Kuroda, said that the newly established deposit facility is aimed at ensuring the stability of the financial system.

Major European indices trade in the green. STOXX Europe 600: +0.4%, Germany's DAX: +0.3%, U.K.'s FTSE 100: +0.3%, France's CAC 40: +0.5%, Italy's FTSE MIB: +0.8%, Spain's IBEX 35: +0.5%.

In economic data:

Eurozone's October CPI 0.2% m/m, as expected (last 0.1%); -0.3% yr/yr, as expected (last -0.3%). October Core CPI 0.1% m/m, as expected (last 0.1%); 0.2% yr/yr, as expected (last 0.2%)

U.K.'s October CPI 0.0% m/m (expected -0.1%; last 0.4%); 0.7% yr/yr (expected 0.6%; last 0.5%). October Core CPI 0.2% m/m (expected 0.1%; last 0.6%); 1.5% yr/yr (expected 1.3%; last 1.3%). October Input PPI 0.2% m/m (expected 0.1%; last 0.3%) and Output PPI 0.0% m/m (expected 0.1%; last -0.1%)

In news:

France's Finance Ministry lowered its forecast for 2021 GDP growth forecast to 6.0% from 8.0%.

France has reportedly agreed to reduced fishing rights in U.K. waters after the Brexit transition period ends, removing a hurdle to a trade deal.

Bank of England Deputy Governor for Markets and Banking, Dave Ramsden, said that the central bank is ready for more action and that forward guidance is more important in a recovery.

Germany's Health Minister said that a coronavirus vaccine will not be compulsory.

U.S equity futures:

S&P 500 Futures +10 @ 3617

DJIA Futures +130 @ 29850

Nasdaq Futures +19 @ 11994

Overseas:

Europe: DAX +0.3%, FTSE +0.3%, CAC +0.5%

Asia: Nikkei -1.1%, Hang Seng +0.5%, Shanghai +0.2%

Commodities:

Crude Oil +1.74 @ 41.87

Nat Gas -0.139 @ 2.856

Gold -12.10 @ 1874.10

Silver -0.270 @ 24.505

Copper +0.0672 @ 3.2452

U.S. Summary:

Earnings/Guidance (Full Earnings Calendar):

Avaya Holdings (AVYA) reports Q4 (Sep) results, beats on revs; guides Q1 revs in-line; guides FY21 revs in-line

BrightView (BV) beats by $0.01, beats on revs

Kingsoft Cloud (KC) beats by RMB1.07, reports revs in-line; guides Q4 revs below consensus

Landstar System (LSTR) anticipates both Q4 revenue and EPS to be slightly above the high end of prior guidance

La-Z-Boy (LZB) beats two analyst estimate by $0.35, beats on revs; guides Q3 revs below consensus; guides Q4 (Apr) revs above two analyst estimate

Lowe's (LOW) beats by $0.02, beats on revs; guides Q4 EPS in-line

Magnite (MGNI) reports total connected TV revenue growth of more than 50% yr/yr for Q3

NIO (NIO) beats by $0.16, beats on revs; guides Q4 revs above consensus

Polaris Industries (PII) reaffirms FY20 EPS and revenue guidance; CEO to step down

Spire (SR) misses by $0.04, reports revs in-line; guides FY21 EPS in-line

Target (TGT) beats by $1.18, beats on revs; comps +9.9%; does not provide guidance

TJX (TJX) beats by $0.32, beats on revs

Varex Imaging (VREX) beats by $0.06, beats on revs; guides Q1 EPS in-line, revs in-line

General News:

US COVID-19 data continues to move in a concerning direction

37 states have business open, while 13 states have select business closures in portions of their states. 4 states have stay at home advisories and/or orders, according to the New York Times

Senate Republicans need Senator Rick Scott (R-FL) to get out of quarantine in order to confirm Judy Shelton for Fed board, but they need to vote by early December, according to Bloomberg

Republicans from Wayne county board of canvassers reversed earlier decision to block certification of election results. The Michigan state board is scheduled to vote on certification of election results on November 23, according to the New York Times

Immunity to COVID-19 could last years, according to the New York Times

GOP Senator Grassley of Iowa tests positive for COVID-19, according to multiple news reports

Amarin (AMRN) presented multiple new VASCEPA (icosapent ethyl)-related scientific findings

Apple (AAPL) announces app store small business program; reduces App Store commission to 15 percent for small businesses earning up to $1 million per year

Beyond Meat (BYND) introduces plant-based minced pork in China, according to CNN

Biogen (BIIB): Samsung Bioepis and BIIB announce FDA filing acceptance of SB11, a proposed biosimilar referencing Lucentis

Boeing (BA): FAA confirms that it has cleared 737 Max to return to flight

Cellectis (CLLS): FDA lifts clinical hold on MELANI-01 Study

Copa Holdings (CPA) shows decline in traffic data for Oct 2020

Chimera Investment's (CIM) President and CEO, Matthew Lambiase, to retire effective December 31, 2020

CMS Energy (CMS) announces Patti Poppe stepping down as CEO, Garrick Rochow named President, CEO

CNH Industrial (CNHI) appoints Scott W. Wine as CEO, effective January 4

Cue Biopharma (CUE) is pleased with progress being made advancing CUE-101 through the ongoing Phase 1

Endeavour Silver (EXK) expands terronera project in Jalisco, Mexico, acquires two adjacent properties covering multiple mineralized veins

Entegris (ENTG) licenses RSP and Extreme Ultraviolet technology to Gudeng Precision Ltd.

Hyundai Motor (HYMTF) faces lawsuit over EV fires as GM launches recall, according to Reuters

Ingevity (NGVT) to challenge U.S. court ruling on emission control patent and expects limited impact on commercial operations or financial results through patent expiration in March 2022

InSteel Industries (IIIN) declares special cash dividend of $1.50/share

K12 (LRN) to change corporate name to "Stride," effective December 16; announces agreements to acquire MedCerts and Tech Elevator; updates FY21 outlook

Kazia Therapeutics (KZIA) summarizes new paxalisib data presented at the SNO Annual Meeting; data said to confirm earlier "positive" safety and efficacy signals in glioblastoma

MSC Industrial (MSM) declares special cash dividend of $3.50/sh, ex-dividend date is Nov 30; payable on Dec 15

Newpark Res (NR) CEO disclosed the purchase of 57.5K shares worth more than $70K (transaction dates 11/13-11/16)

NexTier Oilfield (NEX) and National Oilwell Varco (NOV) entered into an agreement to collaboratively field test NOV's electric fracturing system known as the Ideal eFrac fleet

Pacira Pharma (PCRX) receives European Commission approval for EXPAREL (bupivacaine liposome injectable suspension) for the treatment of postsurgical pain

Pfizer (PFE) and BioNTech (BNTX) conclude phase 3 study of COVID-19 vaccine candidate, meeting all primary efficacy endpoints; 95% effective; plan to submit within days to the FDA for EUA

PG&E (PCG) appoints Patricia K. Poppe as Chief Executive Officer, effective January 4, 2021

Pluristem Therapeutics (PSTI) to present initial results from its Phase I HCT study with PLX-R18 demonstrating safety and efficacy at the ASH Annual Meeting

Regeneron Pharma (REGN) says Roche successfully tested manufacture of COVID-19 drug, according to Reuters

RLI Corp (RLI) CEO to retire at end of 2021; COO Craig Kliethermes will replace him

Ryder System (R) will provide $30 million in bonuses to nearly 30,000 of its frontline employees in North America in appreciation for their extraordinary efforts during the pandemic

Sanofi (SNY) receives priority review for avalglucosidase alfa

Sanofi (SNY) granted Fast Track Designation by FDA for treatment of immune thrombocytopenia

ScanSource (SCSC) appoints Steve Jones as CFO, effective mid-December

Sierra Metals (SMTS) announces large increase in mineral resource tonnage at its Yauricocha Mine in Peru and positive preliminary economic assessment for increase in throughput to 5,500 tonnes per day from today's permitted 3,150 tonnes per day

Syneos Health (SYNH) approved a new $300 mln stock repurchase program that will take effect on January 1, 2021, and which will succeed the Company's existing stock repurchase program that expires on December 31, 2020

Target (TGT) lifts share repurchase suspension; expects to resume share repurchases in 2021; co had approximately $4.5 bln of remaining capacity under the repurchase program

TechnipFMC (FTI) receives Notice to Proceed for major EPC contract

Unilever (UN, UL) wants to increase plant based sales to GBP 1 bln by 2027, according to Financial Times

M&A:

CF Finance Acquisition Corp. (CFFA) completes combination with GCM Grosvenor

Enstar Group (ESGR) announces agreement to sell StarStone Underwriting Limited to Inigo

Fortress Value Acquisition Corp (FVAC). completes business combination with MP Materials; to begin trading on the NYSE under ticker symbol "MP" tomorrow, November 18

KKR (KKR) announces that it has agreed to acquire Argenta

Syndicate:

BeyondSpring (BYSI) announces launch of public offering of $75 mln of its ordinary shares

Camtek (CAMT) commences public offering of 3 mln ordinary shares

Carnival (CCL) prices offering of 57,426,860 shares of its common stock at a price of $18.05 per share to a limited number of holders of its 5.75% Convertible Senior Notes due 2023

Houghton Mifflin Harcourt (HMHC) files for 19,465,570 share common stock offering by selling shareholders

Kodiak Sciences (KOD) prices offering of 5,193,237 shares of its common stock at $108.00 per share

Norwegian Cruise Line (NCLH) prices offering of 40 mln shares of common stock at $20.80 per share

Resideo (REZI) prices offering of 17 mln shares of common stock at $15.00 per share

Simon Properties (SPG) commences offering of 17.5 mln shares of common stock

United Airlines (UAL) files mixed securities shelf offering

IPOs:

Expected to Price:

Aspire Real Estate Investors (NYSE: ASPI): The REIT developing and managing a portfolio of affordable and workforce multifamily housing in Opportunity Zones is expected to price its 15.0 M share IPO at $20.

Maravai Life Sciences (Nasdaq: MRVI): The life sciences company providing critical products to enable the development of drug therapies, diagnostics and novel vaccines is expected to price its 50.0 M share IPO between $24-$27.

NeoGames (Nasdaq: NGMS): The global B2G and B2B technology and service provider to state lotteries and other lottery operators is expected to price its 4.8 M share IPO between $14-$16.

Olema Pharmaceuticals (Nasdaq: OLMA): The clinical-stage biopharmaceutical company developing targeted therapies for women's cancers is expected to price its 10.0 M share IPO between $16-$18.

Sotera Health Company (Nasdaq: SHC): The global provider of mission-critical sterilization and lab testing and advisory services is expected to price its 46.6 M share IPO between $20-$23.

Yasten Holding (NYSE: YSG): The leader in the China beauty market with three color cosmetics and skincare brands is expected to price its 58.8 M ADS IPO between $8.5-$10.50.

Gapping Up/Down

Gapping up:

KZIA +15.9%, VREX +7.4%, LZB +6.1%, HMHC +5.6%, CLLS +5.6%, BNTX +5.5%, FTI +5.1%, CPA +4.7%, CNHI +2.7%, NIO +2.7%, PFE +2.6%, PCG +2.4%, TGT +2.1%, SNY +1.5%, MSM +0.9%, ZIOP +0.7%

Gapping down:

NCLH -6.3%, LOW -6.3%, STKL -5%, KC -4.9%, PII -4.1%, PII -3.4%, CCL -2.3%, CAMT -2.3%, BYSI -1.7%, KOD -1.1%

Analyst Research (see Upgrades/Downgrades calendarfor full list):

Upgrades:

Boeing (BA) upgraded to Outperform from Neutral at Robert W. Baird; tgt raised to $306

Equitrans Midstream (ETRN) upgraded to Neutral from Underperform at BofA Securities

Kirby (KEX) upgraded to Buy from Neutral at BofA Securities; tgt raised to $54

Kohl's (KSS) upgraded to Hold from Reduce at Gordon Haskett; tgt $28

Spirit Aerosystems (SPR) upgraded to Buy from Hold at Jefferies; tgt raised to $40

Tesla (TSLA) upgraded to Overweight from Equal-Weight at Morgan Stanley; tgt raised to $540

Transdigm Group (TDG) upgraded to Buy from Hold at Jefferies; tgt raised to $710

Trinseo (TSE) upgraded to Equal-Weight from Underweight at Morgan Stanley; tgt raised to $38

Downgrades:

Anterix (ATEX) downgraded to Underweight from Neutral at JP Morgan; tgt $30

Ciena (CIEN) downgraded to Neutral from Buy at Rosenblatt; tgt $45

CIT Group (CIT) downgraded to Neutral from Buy at Citigroup; tgt raised to $37

Eidos Therapeutics (EIDX) downgraded to Neutral from Buy at BTIG Research

Honeywell (HON) downgraded to Hold from Buy at HSBC Securities; tgt $200

Honeywell (HON) downgraded to Hold from Buy at Jefferies; tgt raised to $210

ONEOK (OKE) downgraded to Underperform from Neutral at BofA Securities

Rattler Midstream (RTLR) downgraded to Neutral from Buy at BofA Securities

Spirit Aerosystems (SPR) downgraded to Neutral from Buy at Citigroup; tgt raised to $33

UBS AG (UBS) downgraded to Neutral from Buy at Goldman

Others:

American Outdoor Brands (AOUT) initiated with a Buy at CLSA; tgt $18

BigCommerce (BIGC) initiated with a Overweight at Piper Sandler; tgt $83

Brookfield Asset Mgmt (BAM) initiated with a Conviction Buy at Goldman; tgt $51

CRH Plc. (CRH) initiated with a Buy at Deutsche Bank

Cerence (CRNC) upgraded to Buy from Sell at Goldman; tgt $82

Inari (NARI) initiated with a Buy at BTIG Research; tgt $92

Southwestern Energy (SWN) resumed with a Buy at Goldman; tgt $3.75

Upcoming Events:

Econ Data:

07:00 ET: MBA Mortgage Applications Index for November 14 (Briefing.com Consensus NA; Prior -0.5%)

08:30 ET: Housing Starts for October (Briefing.com Consensus 1445K; Prior 1415K)

08:30 ET: Building Permits for October (Briefing.com Consensus 1550K; Prior 1553K)

10:30 ET: EIA Crude Oil Inventories for November 14 (Briefing.com Consensus NA; Prior +4.28M)

Earnings:

Monday (Nov 16)

Morning: ACM AZUL CSPR JD PANW TSN

Afternoon: API BIDU GAN GDS IQ YY MSGE SDC

Tuesday (Nov 17)

Morning: ARMK AQUA HD KSS SE WMT

Afternoon: LZB NIO VREX

Wednesday (Nov 18)

Morning: AVYA BV KC LOW SR TGT TJX

Afternoon: BILI CPA CPRT CUB JACK KEYS KLIC LB NUAN NVDA PAGS SCVL SQM SONO UGI ZTO

Thursday (Nov 19)

Morning: ATKR BERY BJ BRC CSIQ M MMS NTES

Afternoon: BECN BEST CAL ESE HP INTU POST ROST WSM WWD WDAY

Friday (Nov 20)

Morning: BKE FL GSX HHR HIBB

Asia & Europe detail:

Asia: Nikkei -1.1%, Hang Seng +0.5%, Shanghai +0.2%

Equity indices in the Asia-Pacific region ended Wednesday on a mostly higher note. Australia reported its worst wage growth on record in Q3. Reserve Bank of Australia Governor, Philip Lowe, said that while the economy is recovering, the pace has been uneven. China is preparing to sell euro-denominated debt in three tranches. Bank of Korea sold more money stabilization bonds than planned. Bank of Japan Governor, Haruhiko Kuroda, said that the newly established deposit facility is aimed at ensuring the stability of the financial system.

In economic data:

Japan's October trade surplus JPY872.90 bln (expected surplus of JPY250.00 bln; last surplus of JPY687.80 bln). October Imports -13.3% yr/yr (expected -9.0%; last -17.4%) and Exports -0.2% yr/yr (expected -4.5%; last -4.9%)

Australia's Q3 Wage Price Index 0.1% qtr/qtr (expected 0.2%; last 0.2%); 1.4% yr/yr (expected 1.5%; last 1.8%). October HIA New Home Sales -1.3% m/m (last 3.8%)

New Zealand's Q3 Input PPI 0.6% qtr/qtr (last -0.9%) and Output PPI -0.3% qtr/qtr (last -0.3%)

---Equity Markets---

Japan's Nikkei: -1.1%

Hong Kong's Hang Seng: +0.5%

China's Shanghai Composite: +0.2%

India's Sensex: +0.5%

South Korea's Kospi: +0.3%

Australia's ASX All Ordinaries: +0.4%

---FX---

USD/JPY: -0.3% to 103.89

USD/CNH: UNCH at 6.5453

USD/INR: -0.4% to 74.17

Europe: DAX +0.3%, FTSE +0.3%, CAC +0.5%

Major European indices trade in the green. France's Finance Ministry lowered its forecast for 2021 GDP growth forecast to 6.0% from 8.0%. Separately, France has reportedly agreed to reduced fishing rights in U.K. waters after the Brexit transition period ends, removing a hurdle to a trade deal. Bank of England Deputy Governor for Markets and Banking, Dave Ramsden, said that the central bank is ready for more action and that forward guidance is more important in a recovery. Germany's Health Minister said that a coronavirus vaccine will not be compulsory.

In economic data:

Eurozone's October CPI 0.2% m/m, as expected (last 0.1%); -0.3% yr/yr, as expected (last -0.3%). October Core CPI 0.1% m/m, as expected (last 0.1%); 0.2% yr/yr, as expected (last 0.2%)

U.K.'s October CPI 0.0% m/m (expected -0.1%; last 0.4%); 0.7% yr/yr (expected 0.6%; last 0.5%). October Core CPI 0.2% m/m (expected 0.1%; last 0.6%); 1.5% yr/yr (expected 1.3%; last 1.3%). October Input PPI 0.2% m/m (expected 0.1%; last 0.3%) and Output PPI 0.0% m/m (expected 0.1%; last -0.1%)

---Equity Markets---

STOXX Europe 600: +0.4%

Germany's DAX: +0.3%

U.K.'s FTSE 100: +0.3%

France's CAC 40: +0.5%

Italy's FTSE MIB: +0.8%

Spain's IBEX 35: +0.5%

---FX---

EUR/USD: +0.1% to 1.1870

GBP/USD: +0.2% to 1.3270

USD/CHF: UNCH at 0.9112