Morning Note

Calendar

This Week – A few scattered earnings and Fed Speakers, but the al events are Non-Farm Payrolls off cycle due to the shutdown (Tuesday) and CPI Thursday.

Monday – 2 Fed speakers including uber dove Miran.

Tuesday – NFPs, Auto Sales

Wednesday – MU Earnings, 3 Fed Speakers

Thursday – NKE, FDX Earnings, Initial Claims, CPI

Friday – Existing Home Sales

Trading Observations

• Bouncing a bit post AVGO let's hope it builds as day goes on

• Finally start to get some econ data, Oct/Nov jobs tomorrow (but not as 'clean' as usual) and CPI Thurs highlight

• MU earnings Wed post close

• Still in the same range technically, bounced off 6800 support vs. 6900 resistance

• Oscillators near neutral

• Put buying remained subdued (total only .91) despite the selling

• For the bulls, Credit spreads lowest since 1998 https://tinyurl.com/4yymrdkx [tinyurl.com]

• If you think we are in a bubble, historically need to see tightening financial conditions to burst it https://tinyurl.com/3f57wh82 [tinyurl.com]

• New highs encouraging https://tinyurl.com/6ux3n7eu [tinyurl.com]

Futures

DOW +260

S&P +38

Nasdaq +171

Charts/Sentiment

Financials / Consumer / Healthcare

DG – Up 3% - Upgraded to overweight at JPM as valuation looks attractive after meetings with the company. 12% annual EPS growth against a cheaper than normal multiple is the theme.

GS on Lodging – Upgrading MAR, HLT and LVS to Buy, Downgrading WH, CHH, and CZR to Neutral. MAR drivers are World Cup and Credit card, LVS and WYNN are Macau.

TRU, SPGI – JPM making these names their top picks in info-tech.

CRCL – Receiving conditional approval for a National Trust Charter, which means it can become a bank, or the very first Digital Currency Bank. Adds regulatory but legitimizes.

COF – November credit statistics look fine, no major issues.

NKE Earnings this week – Inter-quarter data is mixed overall per GS. Sentiment was horrible, now mixed. China could be the positive driver, but setup isn’t as good as it has been in the past.

IRBT – Declaring bankruptcy. AMZN wanted to buy it for a nothing $1.7B to them, and our old FTC blocked it. Take an L.

BMY – Up 3% on a positive GS note

COST are down 1% after Roth Capital Partners analyst William Kirk cut his recommendation on the club retailer to sell from neutral.

More than 9M US student loan holders have missed at least one payment this year – FT

Technology

Semis / Goldman call: sees hyperscaler AI spending continuing to move higher, driving tailwinds for digital, memory and storage in 2026. It also also sees a gradual industrial and automotive recovery driving cyclical tailwinds in analog.

Semis: performance since Aug 1 = NVDA +1%, AMD +23%, AVGO+24%, SOX+27%, STX+86%, INTC+96%, MU+130%, WDC +130%, SNDK+400%

ADBE: cut to UW at KeyBanc - survey work shows Adobe's competitive pressures have been picking up and will continue to weigh on shares and the multiple .... prefers small- and mid-cap software over large-caps heading into next year (upgraded AKAM, ASAN, FSLY, GTM)

AMAT: +1.8% multiple positive sell-side notes (Jefferies, Wells) - AI should lift semiconductor capital, driving demand across leading edge, DRAM, and packaging

ARM: -2.8% cut to SELL at Goldman - citing limited leverage to the AI cycle, traction across non-traditional markets, and business model transition for the downgrade of Arm

AV Wars: TSLA +1% now testing robotaxi rides in Austin without a human safety monitor in the vehicle ... UBER -1% in sympathy

GOOGL: has a ~7% stake in SpaceX for which it paid just $900M back in 2015, and an IPO of the aerospace firm at a valuation of ~$1.5T (which media reports have said is what SpaceX is targeting) would value Google’s position at more than $110B (Business Insider) ... GOOGL removed AI-generated videos containing Disney characters from YouTube after receiving a cease-and-desist letter from Disney (Variety)

IRBT: Roomba maker iRobot files for bankruptcy; said devices will continue to function normally during restructuring

INTC: in advanced talks to buy AI chip startup firm SambaNova Systems for ~$1.6B (Bloomberg) .... an acquisition of SambaNova would deliver Intel a platform to help build out its AI product offering, with SambaNova having been valued at $5B in 2021

KLAC: upgraded @ Jefferies - says AI should lift semiconductor capital, driving demand across leading edge, DRAM, and packaging. Cites KLA's outsized exposure to the leading edge and recent relative multiple reset for the upgrade

MEMORY: MU +2% ahead of print / positive previews cont to pour in .... DRAM price surge shows no signs of stopping According to reports from Taiwanese media, Samsung has abruptly raised the DDR5 contract price to $19.50, bringing it close to $20. This figure represents an increase of >100% compared to the previous contract price. According to the Taiwanese media's description, Samsung threw up its hands and notified downstream customers that there is "no stock!"

NOW: ServiceNow in advanced talks to buy cybersecurity startup Armis for as much as $7B (Bloomberg) KeyBanc downgraded NOW and ADBE this am..

NVDA: -4% last week (down 4 out of 6 wks) as failed hard @ 50D before plunging thru 100D in 2H of week ... px action has been choppy to say the least since early Sept .... Nvidia is considering increasing H200 production as China demand has come in ahead of existing capacity according to a Reuters report out Fri morning (Reuters)

TXN: -2.5% double downgrade @ GS citing lackluster execution through the cycle, and less leverage than peers in the upcycle

Industrials 

Mining stocks (NEM +2.2%, AEM +1.4%, FCX +3.2%) are among the top gainers in US premarket trading amid a renewed advance in metals prices.

Air Products (APD) downgraded to neutral from buy at Citi

Boeing (BA) delays new Air Force One a year to mid-2028

Builders FirstSource (BLDR) downgraded to hold from buy at Jefferies; $110 PT

Fastenal (FAST) upgraded to buy from hold at Jefferies; $52 PT

Masco (MAS) upgraded to overweight at Wells Fargo; $75 PT

Stanley Black & Decker (SWK) transferred equal weight at Wells; $75 PT

Teradyne (TER) upgraded to buy from sell at Goldman; $230 PT

Teradyne (TER) Cut to Sell at CFRA; PT $170

Trane Technologies (TT) upgraded to overweight from sector weight at KeyBanc; $500 PT

Trex Co. (TREX) upgraded to buy from hold at Jefferies; $42 PT

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