US EARLY MORNING: Equity futures are a touch higher ahead of FOMC, Treasury refunding, ADP, and ISM services

US equity futures are slightly above unchanged (NQ +0.3%, RTY +0.3%, ES +0.3%, YM +0.2%), trading cautiously ahead of today’s busy session which will feature the highly anticipated FOMC meeting and post-meeting press conference with Chair Powell (+50bps rate hike and QT is expected, our preview is here), ADP jobs data will provide us with the usual preview ahead of Friday’s official US jobs report (395k expected, and similar is expected for the official data), while the ISM services data is also due (58.5 expected from 58.3). On the fixed income front, the Treasury’s quarterly refunding will likely see debt sale amounts cut again, with the announcement set to be made ahead of the Fed’s potential QT announcement (the Treasury on Monday already announced a refunding of USD 110bln will raise around USD 55.2bln of cash in the quarter and refund USD 54.8bln in maturing securities). Ahead of today’s action, Treasury yields are slightly higher, but towards the lower end of the day’s range, while major curve spreads are mixed, but around neutral. The Dollar Index, which has already seen hefty gains in the last couple of weeks in anticipation of Fed hawkishness to manage inflation pressures, is currently unchanged. Crude futures are up around USD 2.80 as the EU prepares to implement a phase out of Russian energy within six months, and a phase out of Russian refined products by the end of the year; the bloc assures that such moves will take place in an orderly fashion. Meanwhile, weekly private inventory data were bullish with larger-than-expected stock declines across the board, according to Citi, and would be bullish for prices if confirmed by the DOE report due later today. Energy traders will also be contending with OPEC+ headlines ahead of Thursday’s OPEC+ and JMMC meetings (the JTC sees the 2022 surplus rising +600k BPD vs its previous view, to 1.9mln BPD; OECD stocks are expected to slightly exceed 2015-19 average in Q4); the OPEC+ group is ultimately expected to keep policy steady this month, analysts believe.

KEY US EQUITY LEVELS (via Credit Suisse):

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  SPX: 4063/57, 4072, 4099, 4115, 4128, 4170, 4191, 4208, 4232/35, 4270.


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  NDX: 12592, 12628, 12722/17, 12815/10, 12948, 13318, 13428/56, 13542/43, 13607, 13690.


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  RUT: 1817/13, 1825, 1839, 1850, 1870, 1889, 1915, 1928, 1940, 1954.

TECH:

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  Advanced Micro Devices, Inc. (AMD) - Jumped by 6.8% after results topped expectations and also provided encouraging guidance. Q1 adj. EPS 1.13 (exp. 0.91), Q1 revenue USD 5.9bln (exp. 5.52bln); Q1 Computer And Graphics revenue was USD 2.8bln (exp. 2.64bln), and Enterprise, Embedded And Semi revenues were USD 2.5bln (exp. 2.36bln). Sees Q2 revenue between USD 6.3-6.7bln (exp. 6.38bln), and sees FY 2022 revenue between USD 26.3bln (exp. 25.15bln).


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  Lyft, Inc. (LYFT) - Shares lost 25% of their value after hours as its outlook disappointed expectations. Q1 EPS -57 (exp. -0.07), Q1 revenue USD 875.6mln (exp. 846mln). Q1 Active Riders +31.9% at 17,804, Q1 revenue per active rider +9% at USD 49.18. Exec said Q1 was better than it had expected, and rideshare ride volumes reached a new COVID high. Sees Q2 revenue between USD 0.95-1bln (exp. 1.02bln). Company sees more demand ahead driven by the return of shared rides, especially in H2, and that it has only recovered 70% vs Q4 2019 levels.


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  Intel Corporation (INTC) - Intel acquires Finnish graphics technology company Siru Innovations, which was founded by ex-Qualcomm engineers.


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  Skyworks Solutions, Inc. (SWKS) - Fell over 4.0% after hours after weak guidance for the next quarter. Q2 adj. EPS 2.63 (exp. 2.63), and Q2 revenue USD 1.34bln (exp. 1.33bln). Sees Q3 adj. EPS at 2.36 (exp. 2.55), and sees Q3 revenue between USD 1.2-1.26bln (exp. 1.3bln).


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  Akamai Technologies, Inc. (AKAM) - Dived by over 10% after hours after slashing guidance. Q1 adj. EPS 1.39 (exp. 1.42), Q1 revenue USD 904mln (exp. 903.9mln). FY22 adj. EPS view lowered to 5.32-5.44 (exp. 5.92, prev. 5.82-5.97), and cut its FY22 revenue guidance to USD 3.62-3.67bln (exp. 3.75bln, prev. 3.67-3.73bln). Sees Q2 EPS around 1.28 (exp. 1.45), and sees Q2 revenue between USD 890-905mln (exp. 924.5mln).


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  TeamViewer (TMVWY) - Billings rose and it affirmed its outlook. Q1 revenue EUR 134.5mln (exp. 135mln).


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  Alteryx, Inc. (AYX) - Rose 2.5% after hours. Q1 adj. EPS -0.40 (exp. -0.59), and Q1 revenue USD 157.9mln (exp. 145.9mln). Sees Q2 adj. loss per share between -61c and -58c (exp. -0.29), and sees Q2 revenue between 159-162mln (exp. 156.5mln). For the FY22, sees adj loss per share of -56c to -46c (exp. -0.64), and sees FY22 revenue between USD 730-740mln (exp. 715mln).


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  Paycom Software, Inc. (PAYC) - Jumped over 8% after hours. Q1 EPS 1.90 (exp. 1.75), Q1 revenue USD 354mln (exp. 343mln). Sees Q2 revenue between USD 308-310mln (exp. 301mln), and sees FY22 revenue between USD 1.33-1.34bln (exp. 1.32bln).

COMMUNICATIONS:

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  Twitter (TWTR) - Investor Elon Musk could take Twitter public a few years after his buyout of the social media giant, WSJ reported. Musk has been speaking to investors including private-equity firms about participating in deal. Separately, Musk tweeted that Twitter would always be free for casual users, but it could impose a slight cost for commercial and government users.


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  Match Group (MTCH) - Fell 6.7% after hours on weak guidance. Q1 EPS 0.60 (exp. 0.54), Q1 revenue USD 799mln (exp. 791mln). Q1 total revenue per payer USD 16.00 (exp. 15.94). Announces new CEO, Bernard Kim will replace Shar Dubey. Authorised a 12.5mln share buyback. Sees Q2 revenue between USD 800-810mln (exp. 835.2mln), reflecting the impact of the challenging current macroeconomic environment.


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  Universal Music Group (UNVGY) - Subscription and streaming revenues rose. Q1 revenue EUR 2.20bln (prev. 1.81bln Y/Y). Q1 adj. EBITDA EUR 454mln (prev. 396mln Y/Y).

ENERGY:

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  Russia - EU proposes a ban on Russian oil imports, with a phase out of Russian crude within six months, and a phase out of Russian refined products by the end of the year. EU to ensure phased out takes place in an orderly fashion. Hungary and Slovakia will reportedly get a special regime until 2023. Russia's Interfax news agency, citing a Russian lawmaker, reported that Europe will purchase Russian oil via third nations following the ban on purchases.


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  Inventories - Weekly private inventory data from the API reportedly showed Crude stocks -3.5mln (exp. -0.6mln), Cushing +1mln, Gasoline stocks -4.5mln (exp. -0.8mln), Distillate stocks -4.5mln (exp. -1.4mln), according to Citi, which said the figures were bullish with larger-than-expected stock declines across the board; would be bullish for prices if confirmed by the more definitive DOE report on Wednesday.


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  Equinor (EQNR) - Posted record Q1 profits amid gas price surge. Q1 adj. operating income USD 18bln (exp. 16.92bln). Net USD 5.18bln (exp. 4.85bln). Announces a dividend of 0.20/shr. Will begin the second tranche of its share buyback of around USD 1.33bln. Said its exit from Russia led to an impairment of USD 1.08bln.


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  ONEOK Inc (OKE) - Q1 EPS 0.87 (exp. 0.89), Adj. EBITDA USD 863.9mln (exp. 873mln); affirms FY guidance.

INDUSTRIALS:

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  Maersk (AMKBY) - Q1 revenue USD 19.3bln (prev. 12.4bln). Q1 EBITDA USD 9.08bln (prev. 9.2bln). Global container demand -1.2% (prev. +8% Y/Y), global air cargo volumes increased +2.9%. Global container demand now expected to grow -1/+1% (prev. view +2-4%). Freight rates remained elevated in Q1 as Covid and capacity shortages continued to disrupt the logistics industry. Said trade flow growth flattened from Far East to both North America and Europe, adding hat Russia's invasion of Ukraine was having a negative impact on trade flows and consumer confidence in Europe.


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  Airbus (EADSY) - May need to lower top range of its A321XLR jet amid proposed safety requirements, Bloomberg reported.


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  Tesla (TSLA) - Tesla's second assembly line near Shanghai Gigafactory will add 450k units of annual capacity, according to SCMP.


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  Volkswagen (VWAGY) - Q1 sales were a little short of expectations, but kept outlook unchanged, with its global network offsetting supply chain issues. Q1 revenue EUR 62.74bln (exp. 63.54bln), Q1 deliveries -22% Y/Y. Q1 vehicle sales -14.5% Y/Y. Q1 production -11.9% Y/Y. Based on the figures and the expected better semiconductor supply in H2, confirmed outlook for 2022.


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  BMW (BMWYY), Volkswagen's (VWAGY) - BMW and Volkswagen's Audi suspend shipments by train to China amid client concerns about insurance and confiscation by Russia.


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  Verisk Analytics, Inc. (VRSK) - Fell 2.6% after hours. Q1 adj. EPS 1.34 (exp. 1.39), and Q1 revenue USD 775.5mln (exp. 774.7mln). Named Bruce Hansen as Chair of the board succeeding Scott Stephenson who will retire, as previously announced.


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  Werner Enterprises, Inc. (WERN) - Rose 4.3% after hours. Q1 EPS 0.96 (exp. 0.86), and Q1 revenue USD 764.6mln (exp. 746mln). Noted strong freight demand from its customers in the quarter.


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  Mercury Systems, Inc. (MRCY) - Q3 adj. EPS 0.57 (exp. 0.59), Q3 revenue USD 253.08mln (exp. 249.4mln). Reports record bookings of USD 295mln yielding book-to-bill of 1.17, and record backlog of USD 996mln. Sees Q4 adj. EPS between 0.96-1.06 (exp. 1.10), and sees Q4 revenue between USD 301.5-321.5mln (Exp. 309.5mln). Lowered its FY22 adj. EPS view to 2.34-2.44 (exp. 2.50, prev. 2.51-2.60), and lowered its FY22 revenue guidance to USD 1-1.2bln (exp. 1.01bln, prev. 1-1.03bln).

CONSUMER CYCLICAL:

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  Starbucks Corp (SBUX) - Gained 5% after hours with US comp sales better than expected, and new CEO to be named in the fall. Q2 adj. EPS 0.59 (exp. 0.59), Q2 revenue USD 7.60bln (exp. 7.60bln). Q2 comparable sales +7% globally (exp. 7.5%), +12% in US (exp. 9%), double-digits internationally ex-China; Q2 international comp store sales -8%, China comp store sales -23% (exp. -7%). Q2 net revenues for North America segment +17% Y/Y. CEO said plan is for him to hand over reins in Q1 2023, and will remain on the board after; is working towards naming a new CEO in the autumn.


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  Airbnb, Inc. (ABNB) - Rose 5.7% after hours following publication of results. Q1 EPS -0.03 (exp. -0.29), Q1 revenue USD 1.51bln (exp. 1.45bln). Q1 Gross Booking Value +67% to USD 17.2bln (exp. 15.9bln), more than 70% higher than Q1 2019 levels, and it expects Q2 2022 GBV to increase Q/Q. Exec said people were becoming increasingly confident in booking travel further in advance, with lead times even surpassing 2019 levels by the end of Q1. Ahead, ABNB sees strong sustained pent-up demand. Sees Q2 revenue between USD 2.03-2.13bln (exp. 1.97bln).


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  Yum China Holdings, Inc. (YUMC) - Rose 0.9% after hours. Q1 adj. EPS 0.24 (exp. 0.27), Q1 revenue USD 2.67bln (exp. 2.65bln); comp sales -8% (exp. -9.8%); Pizza Hut comp sales -5% (exp. -10%). KFC revenue +10% Y/Y at USD 2.02bln (exp. 1.96bln), Pizza Hut revenue +1.1% Y/Y at USD 547mln (exp. 526.5mln). Restaurant margins 13.8% (vs 18.7% Y/Y) due to sales deleveraging as a result of the worsened COVID-19 situation. YUMC said it generated operating profit for Q1, but experienced a loss for month of March, adding that unless COVID situation improves significantly in May and June, it expects to incur an operating loss in Q2. Left FY targets unchanged.


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  Caesars Entertainment Corporation (CZR) - Gainde 2.0% after hours. Q1 EPS from cont ops -2.11 (exp. -2.21), Q1 revenue USD 2.3bln (exp. 2.34bln). Q1 adj. same-store EBITDA USD 296mln (prev. 521mln Y/Y); exec said the Las Vegas segment posted an all-time first quarter EBITDA record, consumer trends remain healthy and it is optimistic for the balance of the year. Sees material improvement for Las Vegas occupancy in Q2. Exec added that labour costs were higher in the quarter, but were not a considerable drag, and customer strength was offsetting cost increases.


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  Flutter Entertainment (PDYPY) - Sales rose, underpinned by US markets. Q1 revenue EUR 1.57bln (prev. 1.49bln Y/Y). US revenue +45% Y/Y. UK & Ireland revenue -8% Y/Y. Australia revenue +8% Y/Y. International revenue -5% Y/Y. Said markets were difficult at the moment to consider Fanduel IPO.


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  Aston Martin (ARGGY) - To replace CEO with ex-Ferrari (RACE IM) boss CEO Amedeo Felisa, FT reports.


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  Hugo Boss (BOSSY) - Earnings topped expectations; Q1 revenue EUR 772mln (prev. 497mln). Affirms FY22 revenue and EBIT guidance.


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  Bright Horizons Family Solutions Inc. (BFAM) - Tumbled by over 10% after hours on weak sales numbers. Q1 adj. EPS 0.47 (exp. 0.42), and Q1 revenue USD 460mln (exp. 481.5mln). Lowered its FY22 adj. EPS view to 3.05-3.25 (exp. 3.25, prev. 3.20-3.40), and lowered its FY22 revenue view to between USD 2-2.1bln (exp. 2.1bln, prev. 2.05-2.15bln). Bright Horizons will acquire Only About Children for about USD 320mln.


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  Pandora (PANDY) - Results topped expectations; Q1 revenue DKK 5.69bln (exp. 5.2bln). Q1 EBIT DKK 1.31bln (exp. 1.13bln). Lifted its guidance.

CONSUMER STAPLES:

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  Herbalife Nutrition Ltd. (HLF) - Dropped by over 10% after hours after it lowered its outlook. The company identified that, as a group, the behavior of distributors that joined the business during the pandemic has departed from historical trends and is below the company’s expectations. This slowdown is primarily isolated to the collective performance of that group, while distributors that joined the business pre-pandemic, and the entirety of the company’s preferred customer base continue to order at historical levels.


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  PepsiCo, Inc. (PEP) - Lifted quarterly dividend by 7% to USD 1.15/shr, consistent with its previously announced increase in the annual dividend (by 30c to USD 4.60/shr).

FINANCIALS:

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  American International Group, Inc. (AIG) - Up 1.8% after hours. Q1 adj. EPS 1.30 (exp. 1.18). AIG increased its share repurchase authorisation to USD 6.5bln.


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  Prudential Financial, Inc. (PRU) - Lost over 1% after hours following results. Q1 adj. EPS 3.17 (exp. 2.70).

HEALTH CARE:

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  AstraZeneca (AZN) - Imfinzi plus chemotherapy was granted Priority Review in the US.


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  GlaxoSmithKline (GSK) - Is hiring advisers ahead of the summer demerger of GBP 45bln healthcare division, Sky reports.


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  Fresenius Medical Care (FMS) - Results in line with expectations despite headwinds. Q1 revenue EUR 4.55bln (prev. 4.21bln Y/Y). Q1 net EUR 157mln (prev. 249mln).


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  Fresenius SE (FSNUY) - Profits top expectations in Q1 underpinned by generics. Q1 revenue EUR 9.72bln (exp. 9.5bln). Q1 net EUR 462mln (exp. 430mln). Reaffirms outlook. Appoints Sara Hennicken as new CFO, effective September 1st.


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  Siemens Healthineers (SMMNY) - Raised outlook on demand for COVID testing kits. Q2 revenue EUR 5.46bln (exp. 5.20bln). Q2 adj. EBIT EUR 980mln (exp. 924.8mln).

UTILITIES:

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  EDF (ECIFY) - Revenues were up, but outages limited profit levels. Q1 revenue EUR 35.6bln (prev. 22.0bln), Q1 organic revenue +61% Y/Y. Affirms 2023 guidance.

REAL ESTATE:

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  Public Storage (PSA) - Q1 core FFO/shr 3.65 (exp. 3.60), Q1 revenue USD 973.4mln (exp. 977mln).

04 May 2022 - 09:52- EnergyData- Source: Newsquawk