2/07/2019 Morning Brief

Economic:

The Fed’s vice chairman for supervision, Randal Quarles, said Wednesday that the U.S. economic outlook still looks very good, but he is worried about the negative influence presented by foreign growth developments. The U.S. trade deficit unexpectedly narrowed in November to its smallest amount in five months, driven by a drop in imports, especially from China. Fed Speak: Dallas Federal Reserve Bank President Robert Kaplan is set to speak in Dallas, TX at 9:15 a.m. ET. Federal Reserve Board Vice Chairman Richard Clarida will speak in Prague at 9:30 a.m. ET. St. Louis Federal Reserve Bank President James Bullard is set to speak in St. Cloud, Minnesota at 7:30 p.m. ET. Economic Reports: At 8:30 am ET Jobless Claims at 3:00 pm ET Data on consumer credit for December.

Markets:

U.S. stock futures are pointing to a lower opening. Jobless claims were Higher than expected. Global data continues shown growing weakness in economies around the world, with a report Thursday showing industrial output in Germany unexpectedly fell for the fourth straight month in December.

S&P’s Overnight High 272.22 Low 270.65 % Change lower by -0.58%

Asian Mkts Close Change % Change

Tokyo 20751.28 -122.78 -0.59

Hong Kong 27990.21 59.47 0.21

Euro Mkts Last Change % Change

London 7153.42 -19.67 -0.27

Germany 11137.17 -187.55 -1.66

Oil Prices

Oil prices are trading higher this morning. Official data from the Energy Information Administration showed crude oil inventories rose by 13m barrels last week, well below the expectation of a 2. m barrels increase. The EIA also expects the U.S. to become a net oil exporter by 2020. Major banks are predicting that crude oil prices could run to $68 a barrel for Brent, $63 for WTI in the near term. These forecasts are slightly lower than the December forecasts. Production cuts, sanctions and geo-political issues will all be factors in this move higher. WTI is at $54.13 a barrel, Brent Crude is at $62.79 a barrel.

Options Activity:

Bullish option activity in CPRI, ON & MITK

Bearish option activity in K, TXN & VALE

Sector Update

Retail

SIG P/SGN Signet Jewelers to delay release of 4Q, FY results to April 3, 2019

LB P/SGN Sales fell at the start of the year, but shows gains over a longer time frame.

GES .REC Jeffferies upgrades the stock to Buy from hold with a $24 price target

Drug Makers:

SLDB .FDA Disappointing report on its DMD data, SRPT drug has showed better results

MGNX P/SGN Citi raised its opinion to Buy from sell.

PRTK P/SGN New England Journal of Medicine publishes PRTK phase 3 study.

Dow 30:

DIS Peri.fly Liberty Media’s John Malone to bid for Regional Sports Network.

DIS .REC BMO Capital raised its target price to $114 from $109.

FANG-

FB P/SGN Germany ordered FB to stop combining user data across its platforms.

AMZN Peri.Fly Cloudtail ( top retailer )has returned to AMZN -India site.

GOOG Hots.fly Google selects Equinix, (EQX) for its Cable landing station.

Rumor:

SPY .Economic Initial Jobless Claims 234K vs 221K Expected

STI .MA STI & BBT have agreed to merger in an all stock deal.

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