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End of Day Brief - Wednesday April 21 - Stocks rebound up

SP 5004173.42+38.48(0.93%)
10-yr Note 0/321.560
NYSEAdv 2569 Dec 717 Vol 826.3 bln
NasdaqAdv 3246 Dec 927 Vol 3.9 bln

Industry Watch

Strong: Materials, Energy, Industrials, Financials, Consumer Discretionary
Weak: Communication Services, Utilities

Moving the Market

-- Market bounces back as buying interest spreads to most sectors on no specific catalyst

-- Netflix (NFLX) fell 7% after missing subscriber estimates and issuing disappointing Q2 guidance

Stocks higher as market ends two-day losing streak

Equity futures were softer in early morning trading, as the market looked set to extend the pullback from the record high closes seen Friday, but the major averages gathered themselves and closed in the green as earnings report volume continues to pick up.

ECONOMIC EVENTS: In the U.S., WTI crude was relatively steady following EIA inventory figures that showed a roughly 600,000 barrel rise in crude oil inventories.

In COVID-19 news, President Joe Biden said in a press conference that the U.S. has now administered 200M COVID-19 vaccine shots.

TOP NEWS: Shares of Netflix (NFLX) were 7.4% lower despite better than expected quarterly earnings as the company reported a large miss in subscriber numbers in the first quarter.

In other earnings news, Verizon (VZ) shares were fractionally lower after the telecommunications giant reported slightly better than expected sales and profits and said it is "off to an excellent start in 2021." Verizon also reaffirmed its FY21 adjusted EPS view of $5.00-$5.15 per share, with consensus forecasts currently near the middle of that range.

Anthem (ANTM) shares were fractionally higher after a mixed report, as its earnings beat the consensus forecast but its revenue fell short. The health insurer raised its FY21 adjusted EPS view and backed its FY21 revenue view following its first quarter results.

In M&A news, Middleby Corporation (MIDD) announced an agreement to acquire Welbilt (WBT) in an all-stock transaction that it said "will bring together two complementary businesses, accelerate the Middleby growth strategy into key markets globally and increase core capabilities in highly attractive segments." Welbilt shareholders will receive a fixed exchange ratio of 0.1240x shares of Middleby common stock for each share of Welbilt common stock in an all-stock transaction, with an implied enterprise value of $4.3B. Upon closing, Middleby shareholders will own approximately 76% and Welbilt shareholders will own approximately 24% of the combined company on a fully diluted basis.

On the COVID-19 front, the FDA announced that during an inspection of Emergent BioSolutions (EBS) that ended Tuesday, the FDA cited a number of observations concerning whether the facility's processes met the agency's requirements and standards. "In the case of Emergent BioSolutions, we are working with the company to address the conditions identified," the FDA stated. Johnson & Johnson (JNJ) then said in a statement of its own that it will "exercise its oversight authority to ensure that all of FDA's observations are addressed promptly and comprehensively." J&J added that the company "will also redouble its efforts as it continues to work toward securing Emergency Use Authorization in the United States for drug substance manufactured at Emergent Bayview as quickly as possible, so that the company can help bring an end to this global pandemic. To meet its commitments, the company is establishing a global vaccine supply network, where, in addition to our internal manufacturing site in Leiden, the Netherlands, ten manufacturing sites will be involved in the production of the vaccine across different facilities, sometimes in different countries and continents, before the vaccine can be distributed globally."

MAJOR MOVERS: Among the noteworthy gainers was Luminar Technologies (LAZR), which rose 15.2% after the company announced the hiring of executives who formerly worked at Intel (INTC) and Tesla (TSLA). Also higher was Ocugen (OCGN), which gained 17.8% after the company’s partner Bharat Biotech released an interim analysis of its phase 3 study of COVAXIN.

Among the notable losers was Inotiv (NOTV), which declined 6.2% after announcing a common stock offering. Also lower were Halliburton (HAL) and Knight-Swift (KNX), which fell 3.6% and 5.5%, after reporting their respective quarterly results.

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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