Calendar

This Week – Earnings heavy with over 100 S&P 500 names reporting, but TSLA the only MANGMAN(T). The Fed Speakers are almost all non-voting, so we would expect irrelevance.

Thursday – Jobless Claims, KC Fed, New Home Sales, Earnings – LUV, TSCO,

Friday – Durable Goods, Earnings - HCA

Trading Observations

• Nasdaq looking to recover fueled by TSLA, LRCX and NOW

• Yesterday saw a rotation withing chips of selling AI (NVDA, AMD etc) buying analog (TXN, ON, ADI etc) we will see if that was a one day event

• 20-25% of mutual funds end their years next week, will watch for tax loss selling on YTD losers

• Sitting right on near-term support, 5845.  Then 5800 and 5760

Futures

DOW -41

S&P +26

Nasdaq +173

10-Year Yield

Oil

Gold

Consumer/Financial Healthcare

FCNCA – First Citizens with a weak quarter and guide as 9% downside is implied in Q4.

Capital Markets – GS out positively on CME, TRS, RJF, SF as cash balance sweeps have stabilized.

LC – Up 14% Lending Club up 14% on solid revenue. We never know whether to be bullish or bearish when lenders of last resort like this are doing well.

KKR - Up 3% on earnings +58% y/y. Capital markets and alternatives are minting money….for those who sell them.

LVS Macao EBITDA ahead and boosted buyback. 

HOG lowers FY 2024 outlook

Technology

Megacaps: NVDA+1.2%, META+1.1%, AMZN+1%, GOOGL+0.7%, MSFT+0.5%, AAPL+0.3%

UBER/LYFT: Uber, Lyft Shares Slide on Tesla’s Plans for Ridehailing in 2025 

Uber and Lyft shares fell about 2% in postmarket trading after Tesla CEO Elon Musk said the electric-vehicle maker is aiming to roll out ridehailing services in Texas and California next year, pending regulatory approvals.

IBM: -4.5% missed topline driven by miss in consulting revs, missed FCF, and reiterated FY FCF guide. Consulting: clients in that segment aren’t expanding budgets, and some generative AI projects are coming at the expense of traditional consulting

LRCX: +6% better than feared; sentiment / positioning very light post ASML disaster last week. sees 2025 WFE up with China down (most thought WFE would be down) ... Advanced packaging has been a highlight this year, driven by the performance needs of advanced AI devices; China up q/q on dollar basis vs AMAT -24% q/q

AI/NOW: "AI is doing the soul-crushing work so humans don't have to"

PEGA: +4% ACV +16% y/y; Pega Cloud AVG +30% y/y - accelerating; contd strong FCF ….

TMUS: +4% strong raise to FY; upside on all the key KPIs (postpaid phone adds, high-speed internet net adds, service rev, EPS, EBITDA, FCF)

TSLA: +12% strong EPS/cash flow - big source of the beat was margins w/ GMs +195bp Y/Y while OM spiked 323bp. Mgmt says margins benefited from lower manufacturing costs, reduced freight expense, higher regulatory credit rev, and higher ancillary rev .... Cybertruck has reached profitability

TSLA/NVDA/PLTR/AI: “We deployed and are training ahead of schedule on a 29k H100 cluster at Gigafactory Texas – where we expect to have 50k H100 capacity by the end of Oct”

PEGA: +4% ACV +16% y/y; Pega Cloud AVG +30% y/y - accelerating; contd strong FCF

MXL shares are up 11%, after the semiconductor device company’s fourth-quarter revenue forecast exceeded the average analyst estimate at the midpoint.

TER shares are up 4.5% in premarket trading after the semiconductor manufacturer reported third-quarter results that beat expectations.

Industrials 

ATI, Inc. (ATI) downgraded to sector weight from overweight at KeyBanc

Atlas Copco upgraded to buy from hold at Pareto

Boeing (BA) Machinists reject contract offer, with 64% voting against it - Seattle Times – see Baird commentary below

Howmet Aerospace (HWM) downgraded to sector weight from overweight at KeyBanc

United Parcel Service (UPS) ticking up 7% - Q3 Revs and EPS beat, sees FY Revenue ~$91.1B vs prior guidance ~$93B

HON shares slide 2.5% in premarket trading after the industrial conglomerate lowered its revenue outlook for the year following weaker-than-expected third-quarter sales.