2/11/2019 Morning Brief

Economic:

In a speech on Friday, San Francisco Fed president Mary Daly said The U.S. economy is naturally slowing to a more sustainable pace and this is welcome as it will help prevent a recession. The consensus forecast for 2019 is for growth at a 2% annual rate. Daly's comments conflict with White House chief economist Kevin Hassett, who has predicted the economy can grow at a 3% annual rate thanks to the Trump administration's policy agenda. Trade talks between the U.S & China are scheduled for this week. The markets will be paying close attention to the developments of the talks. While the markets are optimistic about an agreement being reached, it is unlikely to occur prior to the March 1 deadline. Negotiations over the boarder wall funding have apparently stalled which could lead to another government shutdown at the end of the week. Economic Reports: No significant economic reports are due out today.

Markets:

Markets are trading higher this morning as the continuation of the US China trade talks are seen as a positive. Heavy week for earnings results this week. DE, GNRC, XPO, CBS, TRIP, ATVI FOSL OXY and RNG set to release. On Capitol Hill, negotiations over the boarder wall funding is said to be stalling. If no progress is made, another government shutdown is likely.

S&P’s Overnight High 271.83 Low 271.03 % Change higher by 0.37%

Asian Mkts Close Change % Change

Tokyo 20333.17 Closed Holiday

Hong Kong 28143.84 197.52 0.71

Euro Mkts Last Change % Change

London 7105.83 34.65 0.49

Germany 10991.22 84.44 0.77

Oil Prices

Oil prices are trading mixed to higher this morning. Oil have room to move lower. Indications of an economic slowdown can develop into lower consumption. The U.S. is helping to support oil prices with its sanctions on Venezuela and Iran. The oil market is in a situation where we are seeing lower consumption combining with lower production. Net result is stagnate prices. Oil prices are in need of catalyst to help define the next move. Rigs drilling for oil in the US rose by 7 to 854 last week, Baker Hughes said on Friday, marking the second gain in three weeks.

WTI is at $52.45 barrel, Brent Crude is at $62.16 a barrel.

Options Activity:

Bullish option activity in ADM, ATVI & RNG

Bearish option activity in BCS, BSX & W

Sector Update:

Retail

BBBY .REC Loop Capital downgrades the stock to Sell with a $12 price target.

Drug Makers:

BMY .MA Expect to see credit downgrades due to M&A activity in Pharma stocks.

CMTA P/SGN FDA granted rare pediatric disease designation for palovarotene.

MRK P/SGN FDA grants Priority Review to its BLA for Keytruda

Dow 30:

BA P/SGN Values Middle East aviation services market at 745b over the next 18 years.

MCD P/SGN Adding new items to breakfast menu in an effort to regain drop in breakfast sales.

BA .REC JPM raised its price target to $450 from $425.

FANG-

AAPL .Volatile Recorded a 19.9% decline iniPhone shipments to China in Q4 of last year.

AAPL Peri.FLY Reports that non i-phone product lines see mixed shipment forecasts.

AMZN P/SGN Stock is trading higher by 1.15% this morning after falling 4.3% in the last 3 days.

Rumor:

SPY P/SGN Talk between Dem’s & Rep on immigration seem to be going nowhere.

MS .MA Morgan Stanley to acquire Solium Capital for $900M.

LDOS .CTRCT Awarded a contract by NASA for IT services to support the agency's mission.

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