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Fly Intel - End of Day Brief - Tuesday Jan 14, 2020

Stocks end mixed as China tariffs reportedly to remain in place

Stocks ended the session mixed, surrendering earlier gains after media reported that tariffs on China will likely remain until after the upcoming U.S. presidential election. Meanwhile, big banks have been a focal point during the session, as major players Citi (C), JPMorgan (JPM) and Wells Fargo (WFC) all reported quarterly earnings along with other mega-cap financial peers.

ECONOMIC NEWS: In the U.S., December headline CPI rose 0.2%, with the core rate up 0.1%, a little below expectations, following respective November gains of 0.3% and 0.2%. The NFIB small business optimism index dropped -1.9% to 102.7 in December, largely erasing November's 2.2% gain to 104.7.

In trade news, the U.S. Department of the Treasury yesterday determined that no major trading partner, including China, met the relevant legislative criteria for currency manipulation or enhanced analysis. Later on, however, Bloomberg reported, as talks between Washington and Beijing continue over a "Phase 1" of their trade agremeent, that existing tariffs on Chinese goods coming into the U.S. are likely to stay in place until after the presidential election. A U.S. official also told CNBC that there "has been no agreement on a path forward with regard to tariff reduction." CNBC's Eamon Javers then reported via Twitter that the tariffs remaining in place is "what has always been understood."

TOP NEWS: Large U.S. banks kicked off the first earnings season of 2020, with Citi shares rising 1.6% after the lender reported better-than-expected earnings and revenue for the fourth quarter. Also joining in the rush of earnings releases was JPMorgan, whose shares were 1.2% higher after it reported upbeat top- and bottom-line results for Q4, with the bank reported a 19% year-over-year increase in assets under management. On the other side, Wells Fargo shares were 5.4% lower after the bank reported lower-than-ex-ected Q4 earnings per share and revenue, with net interest income for the quarter falling $1.4B year-over-year.

In other earnings news, shares of Delta Air Lines (DAL) rose 3.3% after the carrier reported better-than-expected Q4 results and maintained its fiscal 2020 earnings guidance. Of note, the company said on its quarterly conference call that it expects to repurchase $1B in shares by the middle of the year.

In non-earnings news, Visa (V) was in focus after the payments company announced after the close yesterday that it is buying start-up Plaid in a $5.3B deal. Among Plaid's high-profile clients are PayPal's (PYPL) peer-to-peer payment app Venmo, mobile investing app Robinhood and cryptocurrency exchanges Coinbase and Gemini.

Meanwhile, the Wall Street Journal reported that Amazon (AMZN) has notified its third-party merchants that they could once again use FedEx's (FDX) Ground network to ship orders placed under Amazon's Prime membership program, almost a month after imposing a ban on the service.

Additionally, Disney (DIS) shares closed almost 1% higher after SensorTower said that Disney+ has been downloaded 40.9M times since launch. The service saw more than 30M downloads in the U.S. during the fourth quarter, grossed more than $50M in its first 30 days and earned more revenue in the U.S. than HBO NOW's (T) best month. Disney+ was the number 9 app by worldwide downloads in the fourth quarter, despite launching well into the quarter on November 12, according to SensorTower.

MAJOR MOVERS: Among the noteworthy gainers was SmileDirectClub (SDC), which rose 14.7% after announcing plans to sell aligners directly to orthodontists. Also higher was Beyond Meat (BYND), which gained 2.4% after executive chairman Seth Goldman told China news agency Xinhua that the company hopes to enter the Chinese mainland market this year.

Among the notable losers was NantKwest (NK), which slid 27.9% after reporting results from NK Cells trial which included a compassionate use expanded access IND combining the PD-L1-targeted NK cell with ImmunityBio's IL-15 fusion protein. Also lower was GameStop (GME), which fell 13.3% after reporting holiday sales declined 27% and cutting FY19 same-store sales guidance.

INDEXES: The Dow rose 32.62, or 0.11%, to 28,939.67, the Nasdaq lost 22.60, or 0.24%, to 9,251.33, and the S&P 500 declined 4.98, or 0.15%, to 3,283.15.


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Disclosure: I may trade in the ticker symbols mentioned, both long or short. My articles represent my personal opinion and analysis and should not be taken as investment advice. Readers should do their own research before making decisions to buy or sell securities. Trading and investing include risks, including loss of principal.

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