Briefing.com

Hourly In Play (R)

Updated: 01-Apr-20 08:00 ET

 Today's In Play   
07:59  WRAPX S&P futures vs fair value: -89.50. Nasdaq futures vs fair value: -231.80.

The S&P 500 futures are down 90 points and trade 3.5% below fair value after President Trump warned that the coronavirus could result in 100,000-240,000 U.S. deaths, even with the social distancing guidelines urged to limit its spread. 

The president added that Americans should brace for a "very painful two weeks," as the data suggests that the daily number of deaths will peak in two weeks. The dire warning serves as reminder that the economy still must weather through tougher times and the scope of a recovery may not be the V-shaped some had hoped. 

Investors today will receive several economic reports for March, starting with the ADP Employment Change Report (Briefing.com consensus -175,000) at 8:15 a.m. ET, followed by the ISM Manufacturing Index for March (Briefing.com consensus 43.3) at 10:00 a.m. ET. Construction Spending for February (Briefing.com consensus 0.5%) will be released with the manufacturing report.  

In addition, auto and truck sales for March will be released throughout the day. Earlier, the weekly MBA Mortgage Applications Index increased 15.3% following a 29.4% drop in the prior week. 

U.S. Treasuries trade mixed again with longer-dated tenors continuing to see the bulk of buying activity. The 2-yr yield is up four basis points to 0.24%, while the 10-yr yield is down eight basis points to 0.62%. The U.S. Dollar Index is up 0.7% to 99.69. WTI crude is down 0.2% to $20.44/bbl.  

In U.S. Corporate news:

  • Marriott (MAR 69.79, -5.02): -6.7% after disclosing a breach that impacted 5.2 million customers.
  • Xerox (XRX 18.50, -0.44): -2.2% after withdrawing its offer to acquire HP Inc (HPQ 16.90, -0.46, -2.7%). 

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the midweek session on a mostly lower note. Japan's Nikkei: -4.5%, Hong Kong's Hang Seng: -2.2%, China's Shanghai Composite: -0.6%, India's Sensex: -4.1%, South Korea's Kospi: -3.9%, Australia's ASX All Ordinaries: +3.5%.
    • In economic data:
      • China's March Manufacturing PMI 50.1 (expected 45.5; last 40.3)
      • Japan's Q1 Tankan Large Manufacturers Index -8 (expected -10; last 5) and Q1 Large Non-Manufacturers Index 8 (expected 6; last 20). March Manufacturing PMI 44.8, as expected (last 47.8)
      • South Korea's March Nikkei Manufacturing PMI 44.2 (last 48.7). March trade surplus $5.04 bln (last surplus of $3.98 bln). March Imports -0.3% yr/yr (expected 1.3%; last 1.5%) and Exports -0.2% yr/yr (expected 1.5%; last 4.3%)
      • Australia's February Building Approvals 19.9% m/m (expected 4.5%; last -15.3%) and Private House Approvals -0.8% m/m (last 0.3%). March AIG Manufacturing Index 53.7 (last 44.3) and March Manufacturing PMI 49.7 (expected 50.1; last 50.2).
    • In news:
      • The Bank of Japan reduced its daily purchases of JGBs with maturities between 3- and 5-yrs while Prime Minister, Shinzo Abe, said that he wants larger stimulus than what was deployed after the fall of Lehman Brothers.
      • China's State Council pledged continued support for small and medium enterprises and an increase to local government bond issuance.
  • Major European indices trade in negative territory. STOXX Europe 600: -3.4%, Germany's DAX: -3.8%, U.K.'s FTSE 100: -3.6%, France's CAC 40: -4.2%, Italy's FTSE MIB: -2.2%, Spain's IBEX 35: -2.3%.
    • In economic data:
      • Eurozone's February Unemployment Rate 7.3% (expected 7.4%; last 7.4%) and March Manufacturing PMI 44.5 (expected 44.7; last 44.8)
      • Germany's February Retail Sales 1.2% m/m (expected 0.1%; last 1.0%); 6.4% yr/yr (expected 1.5%; last 2.1%). March Manufacturing PMI 45.4 (expected 45.5; last 45.7)
      • U.K.'s March Manufacturing PMI 47.8 (expected 47.0; last 51.7)
      • France's March Manufacturing PMI 43.2 (expected 42.9; last 49.8)
      • Italy's March Manufacturing PMI 40.3 (expected 40.5; last 48.7)
      • Spain's March Manufacturing PMI 45.7 (expected 44.0; last 50.4)
      • Swiss March procure.ch PMI 43.7 (expected 40.0; last 49.5)
    • In news:
      • The European Banking Authority called on all banks to limit dividends and share buybacks while the Bank of England and Prudential Regulation Authority issued similar guidelines that also call for a suspension of buybacks and bonuses to senior staff.
      • Italy's Prime Minister, Giuseppe Conte, once again called for the issuance of euro bonds despite opposition from Austria and Germany.
07:59  SCANX Gappiing down

Gapping down
In reaction to disappointing earnings/guidance
:

  • PAYS -20.5% (postpones earnings call), BB -14.6%, VRNT -12.3%, GVA -1.1%

Other news:

  • DK -8.5% (to dropdown logistics assets to DKL)
  • MAR -7.8% (disclosing data breach that impacted 5.2 mln customers)
  • CAR -7.5% (attributed to block trade)
  • GIII -6.2% (announces employee furloughs)
  • TWO -6.1% (details additional risk factors in 10-K)
  • NOC -5.3% (files mixed securities shelf offering)
  • SIX -4.5% (adopts short-term stockholder rights plan)
  • MTCH -4.4% (says it's seeing fewer new users joining; also co has delayed several product feature and press launches)
  • HPQ -3.8% (Xerox withdraws its offer to acquire HPQ)
  • AGNC -3.2% (believes that the worst is behind it for its Agency MBS portfolio)
  • MMM -2.4% (provides details about capacity increases of N95 respirators)
  • JKS -2.4% (sings a one-year AUD37 million line of credit agreement with the National Australia Bank)
  • XRX -2.2% (Xerox withdraws its offer to acquire HPQ)
  • SGMS -2.1% (signs new 4-year deal with LOTTO Bayern in Germany)

Analyst comments:

  • SYK -8% (downgraded to Sell from Buy at Goldman)
  • I -5.9% (downgraded to Sell from Neutral at Goldman; tgt lowered to $0.50)
  • TSLA -3.7% (Bernstein stays Market Perform rated on TSLA, $730 tgt; "materially" lowering 2020 ests)
  • T -3.4% (downgraded to Neutral from Overweight at JP Morgan)
  • VAR -2.6% (downgraded to Neutral from Buy at Goldman )
  • BRKR -2.5% (downgraded to Hold at Needham)
07:54  SCANX Gapping up

Gapping up
In reaction to strong earnings/guidance
:

  • PUMP +1.8%  

Other news:

  • IFRX +74.3% (doses first patient in trial investigating IFX-1 in patients with severe COVID-19-induced pneumonia)
  • CEMI +32.8% (to launch DPP COVID-19 serological point-of-care test; results in 15 minutes from a simple finger stick)
  • MNK +16.2% (Mallinckrodt plc and Novoteris receive clearance from Health Canada to start pilot trial of high-dose inhaled nitric oxide therapy for COVID-19 infection and associated lung complications)
  • VEL +14% (files to delay its 10-K)
  • INSG +12.2% (ramping up production of its 4G and 5G MiFi mobile hotspots and other wireless connectivity devices in response to record increases in demand)
  • NVAX +8.4% (signs NanoFlu manufacturing agreement with EBS)
  • GCI +8.1% (announces business response to COVID-19)
  • OII +4.5% (confirms Q1 guidance but is withdrawing its full-year 2020 guidance)
  • BP +3.5% (provides COVID-19update)
  • VECO +2.9% (reports prelim Q1 revs in-line with consensus)
  • FLXN +2.9% (enters into an exclusive license agreement with HK Tainuo and Jiangsu Tainuo for the development and commercialization of ZILRETTA)
  • CMTL +2.4% (provides COVID-19 update; withdraws outlook)
  • WSO +2% (increases quarterly dividend to $1.775/share from $1.60/share)

Analyst comments:

  • ABM +0.8% (upgraded to Overweight from Sector Weight at KeyBanc Capital Markets)
07:34  INSG Inseego 'is ramping up production of its 4G and 5G MiFi mobile hotspots and other wireless connectivity devices in response to record increases in demand' (6.23 )

 
07:33  WSO Watsco increases quarterly dividend to $1.775/share from $1.60/share (158.03 )

 
07:30  SUMRX European Markets Update: DAX -3.8%, FTSE -3.6%, CAC -4.2%

Major European indices trade in negative territory. The European Banking Authority called on all banks to limit dividends and share buybacks while the Bank of England and Prudential Regulation Authority issued similar guidelines that also call for a suspension of buybacks and bonuses to senior staff. Italy's Prime Minister, Giuseppe Conte, once again called for the issuance of euro bonds despite opposition from Austria and Germany.

  • In economic data:
    • Eurozone's February Unemployment Rate 7.3% (expected 7.4%; last 7.4%) and March Manufacturing PMI 44.5 (expected 44.7; last 44.8)
    • Germany's February Retail Sales 1.2% m/m (expected 0.1%; last 1.0%); 6.4% yr/yr (expected 1.5%; last 2.1%). March Manufacturing PMI 45.4 (expected 45.5; last 45.7)
    • U.K.'s March Manufacturing PMI 47.8 (expected 47.0; last 51.7)
    • France's March Manufacturing PMI 43.2 (expected 42.9; last 49.8)
    • Italy's March Manufacturing PMI 40.3 (expected 40.5; last 48.7)
    • Spain's March Manufacturing PMI 45.7 (expected 44.0; last 50.4)
    • Swiss March procure.ch PMI 43.7 (expected 40.0; last 49.5)

---Equity Markets---

  • STOXX Europe 600: -3.4%
  • Germany's DAX: -3.8%
  • U.K.'s FTSE 100: -3.6%
  • France's CAC 40: -4.2%
  • Italy's FTSE MIB: -2.2%
  • Spain's IBEX 35: -2.3%

---FX---

  • EUR/USD: -0.8% to 1.0943
  • GBP/USD: -0.3% to 1.2389
  • USD/CHF: +0.6% to 0.9655
07:26  S&P futures vs fair value: -89.10. Nasdaq futures vs fair value: -228.80.

07:08  S&P futures vs fair value: -91.10. Nasdaq futures vs fair value: -234.60.

07:08  European Markets

FTSE...5463.52...-208.40...-3.70%.  DAX...9585.88...-350.00...-3.50%.
07:08  Asian Markets

Nikkei...18065...-851.60...-4.50%.  Hang Seng...23086...-517.70...-2.20%.
07:06  HSIC Henry Schein will serve as the exclusive distributor in the United States of a second point-of-care rapid test kit that can detect antibodies associated with COVID-19 (50.52 )

  • Working with BD (BDX), a leading global medical technology company, and BioMedomics, a privately held, North Carolina-based clinical diagnostics company, Henry Schein will make the test kits available to health care professionals as part of the Company's broad offering of point-of-care rapid tests.
  • The BioMedomics test analyzes blood, serum, or plasma samples for the presence of Immunoglobulin M (IgM) and Immunoglobulin G (IgG) antibodies associated with the coronavirus (SARS-CoV-2). The test is completed in four simple steps. First, blood is collected through normal blood collection devices, and then a few drops are transferred to the test cartridge, followed by two to three drops of a buffer. The results can be read in 15 minutes.
07:06  RRGB Red Robin Gourmet suspends share repurchases, withdraws prior 2020 and long-term outlook due to COVID-19 impact (8.52 )

 
07:03  FLXN Flexion Therapeutics enters into an exclusive license agreement with HK Tainuo and Jiangsu Tainuo for the development and commercialization of ZILRETTA, withdraws 2020 ZILRETTA revenue guidance due to the impact of the coronavirus global pandemic (7.87 )

  • HK Tainuo will pay Flexion an upfront payment of $10 million. Flexion will also be eligible to receive up to $32.5 million in aggregate development, regulatory and commercial sales milestone payments. HK Tainuo will be responsible for the clinical development, product registration and commercialization of ZILRETTA in Greater China.
  • The terms related to product manufacturing and supply, including pricing and minimum purchase requirements agreed to in the license agreement, will be covered by a separate supply agreement. HK Tainuo expects to be able to file a Clinical Trial Application for ZILRETTA with the China National Medical Products Administration by the end of 2020 and to begin clinical studies in China as soon as possible thereafter.
  • Due to the extraordinary impacts of the novel coronavirus global pandemic, Flexion has determined that it is prudent to withdraw its previous ZILRETTA revenue guidance for 2020.
07:00  SUMRX Asian Markets Close: Nikkei -4.5%, Hang Seng -2.2%, Shanghai -0.6%

Equity indices in the Asia-Pacific region ended the midweek session on a mostly lower note. The Bank of Japan reduced its daily purchases of JGBs with maturities between 3- and 5-yrs while Prime Minister, Shinzo Abe, said that he wants larger stimulus than what was deployed after the fall of Lehman Brothers. China's State Council pledged continued support for small and medium enterprises and an increase to local government bond issuance.

  • In economic data:
    • China's March Caixin Manufacturing PMI 50.1 (expected 45.5; last 40.3)
    • Japan's Q1 Tankan Large Manufacturers Index -8 (expected -10; last 5) and Q1 Large Non-Manufacturers Index 8 (expected 6; last 20). March Manufacturing PMI 44.8, as expected (last 47.8)
    • South Korea's March Nikkei Manufacturing PMI 44.2 (last 48.7). March trade surplus $5.04 bln (last surplus of $3.98 bln). March Imports -0.3% yr/yr (expected 1.3%; last 1.5%) and Exports -0.2% yr/yr (expected 1.5%; last 4.3%)
    • Australia's February Building Approvals 19.9% m/m (expected 4.5%; last -15.3%) and Private House Approvals -0.8% m/m (last 0.3%). March AIG Manufacturing Index 53.7 (last 44.3) and March Manufacturing PMI 49.7 (expected 50.1; last 50.2)

---Equity Markets---

  • Japan's Nikkei: -4.5%
  • Hong Kong's Hang Seng: -2.2%
  • China's Shanghai Composite: -0.6%
  • India's Sensex: -4.1%
  • South Korea's Kospi: -3.9%
  • Australia's ASX All Ordinaries: +3.5%

---FX---

  • USD/JPY: -0.1% to 107.46
  • USD/CNH: +0.2% to 7.1024
  • USD/INR: UNCH at 75.31
06:56  APA Apache doubles estimate of annual cost savings from recent organizational redesign (4.18 )

  • Co provided an update regarding the cost savings associated with its previously announced organizational redesign.
  • Apache now expects to deliver an annualized G&A and LOE cost reduction in excess of $300 million, up from an original target of $150 million. Approximately $225 million of the identified savings, which includes the impact of severance and reorganization costs, will be achieved in 2020.
06:55  GCI Gannett announces business response to COVID-19 (1.48 )

  • "We expect operating performance to be adversely affected by the widespread disruption caused by the COVID-19 pandemic. As a media company, we are generally exempt from mandates requiring closures of non-essential businesses and therefore have been able to continue operations. However, we expect our advertising and events revenues to decline as a result of widespread business closures and social distancing measures.
  • In addition, we continue to target $100 - $125 million in real estate sales by the end of 2021, the proceeds of which we intend to use to pay down debt. Since reporting fourth quarter earnings, the Company has paid down an additional $3.3 million of principal on our term loan facility, reducing debt outstanding to $1.744 billion."
06:49  HWM Howmet Aerospace begins trading today on the NYSE following the separation of Arconic (ARNC) into two standalone companies complete (16.06 )

 
06:47  MNK Mallinckrodt plc and Novoteris receive clearance from Health Canada to start pilot trial of high-dose inhaled nitric oxide therapy for COVID-19 infection and associated lung complications (1.98 )

  • Co announces that the Therapeutic Products Directorate of Health Canada has cleared the companies' joint pilot clinical trial, entitled "Inhaled Gaseous Nitric Oxide Antimicrobial Treatment of Difficult Bacterial and Viral Lung (COVID-19) Infections" application to investigate the use of Thiolanox, a high-dose inhaled nitric oxide therapy for the treatment of patients infected with novel coronavirus (SARS-CoV-2) at Vancouver Coastal Health Authority facilities.
  • The investigative therapy employs Novoteris' Inhaled Nitric Oxide Delivery Device (INODD) and Mallinckrodt's high-concentration, 5000 PPM nitric oxide gas for inhalation canisters. The study will investigate the therapy's safety and effectiveness in treating COVID-19 and its associated lung complications. The companies expect to begin recruiting patients in the coming days.
06:36  WIRES On The Wires

  • Mesoblast (MESO) announced that the FDA has accepted for priority review the Company's Biologics License Application filing for RYONCILTM (remestemcel-L), its allogeneic cell therapy for the treatment of children with steroid-refractory acute graft versus host disease (SR-aGVHD). The FDA has set a Prescription Drug User Fee Act action date of September 30, 2020, and if approved, Mesoblast will make RYONCIL immediately available in the United States.
  • Equitrans Midstream (ETRN) announced that its Board of Directors has appointed Patricia Collawn, chairman, president, and chief executive officer of PNM Resources, a publicly traded energy holding company that provides electricity to homes and businesses in New Mexico and Texas, to the Company's Board of Directors, effective April 1, 2020.
06:33  ARNC Arconic launches as standalone company (16.06 )

The Company's common stock will begin trading on the New York Stock Exchange under the ticker "ARNC" at 9:30 a.m. Eastern Daylight Time on April 1, 2020.
06:32  VRAY ViewRay announce strategic collaboration to accelerate adoption of personalized cancer care (2.50 )

  • Co announces a strategic collaboration with VieCure, an artificial intelligence (AI) informatics company with a leading point-of-care clinical decision support platform and a comprehensive electronic medical record (EMR) in oncology.
  • The collaboration is designed to drive personalized care and treatment to patients by educating oncology practices on both companies' precision oncology solutions.
06:09  CYDY CytoDyn files a clinical trial protocol with the FDA to treat severely ill COVID-19 patients with leronlimab where the primary endpoint is mortality rate at two weeks (2.66 )

  • Co announces that it has filed a second clinical trial protocol with the U.S. Food and Drug Administration (FDA) to treat severely ill COVID-19 patients with leronlimab. This trial will be conducted under the same FDA-approved IND as the Company's recently initiated Phase 2 clinical trial to treat COVID-19 patients with mild-to-moderate indications.
  • The Company's investigational new drug, leronlimab, has been administered to 10 severely ill patients with COVID-19 at a leading medical center in the New York City area under an emergency IND recently granted by the FDA.
06:08  VLRS Volaris Aviation announces temporary reduction of capacity, as a result of the declaration of health emergency in Mexico (3.43 )

  • The Declaration of Emergency and the health security measures announced by the GHC, such as the suspension of non-essential activities in the public, private and social sector, as well as the call to the population to comply with stay at home, will impact the demand for passenger air transportation whilst the Declaration of Emergency is in effect.
  • As a result, from the date hereof, Volaris will make an additional capacity reduction to that which was advised on March 24, 2020. Capacity measured by available seat miles (ASMs) for the month of April, 2020 will reduce to approximately 80% of total operation versus the schedule originally published.
06:07  AFIN American Finance Trust intends to pay monthly dividends on each share of Class A common stock at an annualized rate of $0.85 per share (6.25 )

 
06:06  ESTE Earthstone Energy reduces capital program by 67% (1.76 )

  • Co announced that the regularly scheduled redetermination of the borrowing base under its senior secured revolving credit facility has been completed with the borrowing base now set at $275 million, representing a 15% decrease from the previous borrowing base of $325 million. The next regularly scheduled redetermination of the borrowing base is on or around November 1, 2020.
  • The Company also has provided an update on its debt balance. As of March 31, 2020, the Company had outstanding borrowings under its Credit Facility of $152 million, which represents a reduction of 11% compared to the $170 million in outstanding borrowings as of December 31, 2019. The Company's only debt is borrowings under the Credit Facility.
  • Management Comments - "Earthstone remains well positioned in terms of liquidity and debt levels despite the recent dramatic drop in commodity prices. As recently announced, we have reduced our 2020 capital program by 67% and expect to generate free cash flow beginning in the second quarter that we will use to reduce borrowings under our credit facility..."
06:02  WIRES On The Wires

  • Royal Philips (PHG) announced that it can help general practitioners and healthcare institutions manage the increased patient flows resulting from the COVID-19 outbreak through a dedicated and scalable telehealth solution that facilitates the use of online screening, follow-up questionnaires and monitoring, and external call center collaborations. It aims to prevent unnecessary visits to general practitioners and hospitals and the remote monitoring of the vast majority of COVID-19 patients that are in quarantine at home.
  • Ribbon Communications (RBBN) and ECI Telecom Group announced that it has been chosen by Poka Lambro Telephone Co-operative in Texas to upgrade its fiber optic and high-speed internet infrastructure.
06:02  JKS JinkoSolar Holding sings a one-year AUD37 million line of credit agreement with the National Australia Bank (14.85 )

 
06:02  BEST BEST Inc intends to create over 40,000 jobs in China and Southeast Asia this year to meet current and anticipated demand recovery in supply chain and logistics (5.15 )

  • The additional jobs will be created through BEST's various divisions, including Express, Freight, Supply Chain Management and Global. These roles will cover technology development, product operations, quality control and procurement, as well as front line operations such as warehousing, sorting and transportation.
06:02  CMCL Caledonia Mining defers April dividend decision (9.28 )

  • Co announces that due to the uncertain business environment associated with the COVID-19 Pandemic, the board of directors has decided to defer its approval of the declaration of the second quarterly dividend of 2020. The board will keep this decision under constant review as it monitors prevailing market conditions.
06:01  BP BP provides COVID-19update; now expects 2020 organic capital spend to be around $12 bln, around 25% below its prior full-year guidance (24.39 )

  • Divestment program: BP's existing divestment program to deliver $15 billion of announced transactions by mid-2021 remains on track. The phasing of receipt of $10 billion of divestment proceeds by the end of 2020 may be revised as transactions complete, particularly while volatile market conditions persist. This includes the sale of our Alaskan business to Hilcorp which we continue to expect will complete during 2020, subject to regulatory approvals. We will provide further information on this transaction going forward, as appropriate.
  • To date, $9.6 billion of transactions have been announced since the start of 2019, with around $3.4 billion of cash proceeds received. This divestment programme is underpinned by a wide range of options, including assets in less commodity-sensitive businesses where demand remains strong.
  • Capital expenditure: We now expect 2020 organic capital spend to be around $12 billion, around 25% below our prior full-year guidance. In Upstream, this includes a reduction of around $1.0 billion in spend on short-cycle onshore activity, including in BPX Energy, as well as deferral of certain exploration and appraisal activity and optimisation of our major project spend. In Downstream, we expect a reduction in spend of around $1.0 billion, which includes reduced spending across our fuels marketing, refining and petrochemicals businesses.
  • BP continues to monitor the impact of COVID-19 on our global operations and in the first quarter there was no significant operational impact. This could change through the second quarter.
  • BP's first-quarter reported Upstream production is expected to be lower than fourth-quarter 2019, in a range of 2,550-2,600 mboed;
06:01  BCS Barclays PLC decided that for 2020 the Company will not undertake any interim ordinary share dividend payments, accrual of ordinary share dividends, or share buybacks. (4.53 )

  • In addition, in response to a request from the UK Prudential Regulation Authority and to preserve additional capital for use in serving Barclays' customers and clients, the Board has agreed to cancel the 6.0p per ordinary share full year 2019 dividend that was due for payment on 3 April 2020. The Board will decide on any future dividend policy and amounts at year-end 2020.
  • The Company still intends to publish its Q1 2020 Results Announcement on or about 29 April 2020.
06:01  WIRES On The Wires

  • Sally Beauty Holdings (SBH) announced the appointment of Marlo Cormier, as Senior Vice President - Finance and Chief Accounting Officer. Ms. Cormier was also named to the Company's senior leadership team. Ms. Cormier joins the Company from Fossil Group, Inc., where she was Senior Vice President, Corporate Finance and Chief Accounting Officer.
  • Trupanion (TRUP) announced the continued collaborative efforts of the COVID Council for animal health. The move follows groundbreaking attendance from thousands of members of the animal health community in the recent webinar hosted by the group.
  • Amgen (AMGN) announced that it has consummated the purchase from Astellas of 49% of shares of Amgen Astellas BioPharma K.K, a joint venture between Amgen and Astellas established in 2013. AABP, which is now a wholly-owned Amgen affiliate in Japan renamed Amgen K.K., has enabled Amgen to build a strong presence in Japan as it advances treatments for serious illnesses.
06:01  TECK Teck Resources provides Q1 update; suspending guidance (7.56 )

  • Co provided an update on Q1 2020 operations, preventative measures taken with respect to COVID-19 and updated its 2020 annual guidance.
  • Q1 2020 Operations Update - Following a difficult start to the year, results in our Steelmaking Coal Business Unit improved significantly in late February and March. First quarter steelmaking coal sales are estimated at 5.6 million tonnes, exceeding our guidance of 4.8 to 5.2 million tonnes. At the same time, based on preliminary results we expect to report adjusted site cost of sales of approximately $65 per tonne, well below previous expectations.
    • Taking into account both the cost savings and the higher average pricing for Elkview coal, assuming US$150 benchmark coal pricing and current exchange rates, this should translate to an annual $110 million increase in EBITDA.
  • COVID-19 Production Impacts - Impacts from COVID-19 will vary by operation, but production will continue at sites on a reduced basis.
    • While the reductions at our steelmaking coal operations will vary by mine, total production is expected to be reduced on average to approximately 80% to 85% of normal levels during the initial two week period.
  • 2020 Guidance - "Given the high degree of uncertainty associated with the current COVID-19 situation we are suspending our 2020 guidance. We will provide a further update when we report our Q1 2020 financial results."
06:01  CEMI Chembio Diagnostics to launch DPP COVID-19 serological point-of-care test; results in 15 minutes from a simple finger stick (5.12 )

  • Co announced the U.S. launch of the rapid DPP COVID-19 serological point-of-care test for the detection of IgM and IgG antibodies. These results can be obtained within 15 minutes from a simple finger stick utilizing Chembio's MicroReader 1 and MicroReader 2 analyzers which are produced by Chembio Germany.
  • The ability of the DPP platform to provide numerical results can aid clinicians in determining current or past exposure to the COVID-19 virus and monitoring infection progression, while avoiding the human interpretation errors associated with visual readings.
06:01  RARE Ultragenyx Pharma enters strategic partnership with Daiichi Sankyo (DSNKY) for Ultragenyx's proprietary AAV-based gene therapy manufacturing technologies (44.43 )

  • Ultragenyx Pharmaceutical announced a strategic partnership and non-exclusive license and technology access agreement with Daiichi Sankyo Company for Ultragenyx's proprietary AAV-based gene therapy manufacturing technologies. Ultragenyx's HeLa producer cell line platform enables large commercial-scale AAV-based gene therapy product manufacturing that is intended to be highly reproducible, more consistent, and less expensive than other gene therapy manufacturing platforms. In addition, Ultragenyx has developed a proprietary HEK293 transient transfection system for AAV manufacture which is also a subject of the collaboration.
  • Daiichi Sankyo granted non-exclusive license to Ultragenyx HeLa manufacturing platform.
  • Ultragenyx to receive $200 million upfront, including $125 million in cash and $75 million via equity investment.
06:00  SUMRX Overnight Summary -- World markets lower as US continues to warn about coronavirus fallout

  • The global equity markets are all trading lower following the US's coronavirus update that the nation could experience 100,000 to 240,000 deaths due to the pandemic and that the next two weeks may be painful. The markets certainly showed disdain for the dire warning. S&P Futures have retreated back to the 2500 area after putting in a high of 2562.25. The session low resides at 2476.25.
  • In Asia, the regional markets closed lower with China down 0.6%, while Japan dropped 4.5%. China's March Caixin Manufacturing PMI showed slight expansion with a print of 50.1, up from last month's reading of 40.3 and well above consensus or 45.5. The Nikkei tumbled after sentiment soured following the US's coronavirus update and the BOJ's Q1 Large Manufacturing Tankan Survey plunging to a -8 reading. This marked the fifth straight decline and the worst since 2008.
  • In Europe, the major bourses are all trading lower, in tandem with the rest of the world. Banks are among the hardest hit with names such as Deutsche Bank and Soc Gen both down 5%. 

Market Updates

  • S&P Futures vs Fair Value: -74.0
  • 10 yr Note: 0.619%
  • USD/JPY: 107.56 +0.07
  • EUR/USD: 1.0922  -0.0107
  • Europe: FTSE -3.8%  DAX -2.5%  CAC -3.5%
  • Asia: Hang Seng -2.2% Shanghai -0.6% Nikkei -4.5%
  • Gold (1605.20 +8.60) Silver (14.18 +0.02) Crude (20.19 -0.29)
 Tuesday After the Close   
18:17  RPT RPT Realty withdraws 2020 guidance (6.02 +0.24)

  • Co says it has taken decisive actions to enhance liquidity and balance sheet flexibility in light of the pandemic.
  • Co has reduced capital expenditures and implemented further liquidity enhancing measures.
  • Co is withdrawing all previously provided guidance for 2020
18:14  AGNC AGNC Investment believes that the worst is behind it for its Agency MBS portfolio (10.58 -1.10)

  • Co took aggressive actions to counter these extremely challenging market conditions in an effort to strengthen its liquidity position and mitigate risk.
  • AGNC's leverage and liquidity levels have returned to recent norms. As such, co believes that the worst is behind it for its Agency MBS portfolio, which allows co to focus on positioning the portfolio to benefit from the current market environment.
  • Tangible net book value per common share is estimated to be between $12.35 and $13.25, after deductions for common and preferred dividends declared through March 31.
17:53  EQX Equinox Gold guides to 2020 production of 540,000 to 600,000 ounces of gold (6.63 +0.16)

  • Co announces 2020 production and cost guidance of 540,000 to 600,000 ounces of gold at all-in-sustaining costs of $1,000 to $1,060 per oz.
  • "With the merger complete, Equinox Gold expects to more than triple its annualized gold production in 2020 and is fully funded to increase production over the next two years to more than one million ounces of gold annually. We also recognize the challenges presented by the COVID-19 pandemic and its potential effect on our operations and our guidance for this year. If necessary, we will adjust our expectations as the situation evolves."
17:51  HPQ HP responds to Xerox withdrawal of offer (17.41 -0.43)

  • Co responds to Xerox (XRX) withdrawl of offer (see 16:37 comment). HP says it's a strong company and has a healthy cash position and balance sheet that enable it to navigate unanticipated challenges such as the global pandemic.
  • Its focus remains on addressing the needs of its ecosystem of stakeholders around the world.
17:45  MTCH Match Group says virus impact may make it challenging to grow revenue from Q1 to Q2 this year (66.04 -0.63)

  • In an 8-K filing, co says virus's impact may make it challenging to grow revenue from Q1 to Q2 this year, although co currently believes it will have year-over-year Q2 revenue growth.
  • Co says while it has seen increases in engagement trends among younger users, it's seeing fewer new users joining its products. This impact is most pronounced among users over the age of 30 and varies by region, depending on the level of COVID-19 containment.
  • In markets in Asia where containment has gone well, such as Japan and South Korea, its business has largely remained intact.
  • In countries severely impacted by COVID-19, like Italy and Spain, co has seen more significant declines.
  • As a result of the virus, co has delayed several product feature and press launches, including the international launch of Swipe Night on Tinder. With the Olympic Games now moving to 2021, the co is also postponing a number of marketing campaigns planned around the Games.
17:33  SGMS Scientific Games signs new 4-year deal with LOTTO Bayern in Germany (9.70 +0.81)

  • Co signs a new four-year systems technology agreement with long-time partner Staatliche Lotterieverwaltung ("LOTTO Bayern"), the state lottery of Bavaria in Munich, Germany.
  • The Lottery may extend the contract up to five additional years.
17:32  DK Delek US Holdings announces agreement to dropdown logistics assets to Delek Logistics Partners (DKL) (15.76 -0.28)

Delek US Holdings and Delek Logistics Partners today announced an agreement for the dropdown of the Big Spring gathering system to Delek Logistics for total consideration of $100 mln in cash and 5.0 mln common units representing limited partnership interest in Delek Logistics. The transaction is effective March 31 and is expected to be immediately accretive to Delek Logistics' distributable cash flow per unit. These assets and services are projected to generate incremental annual EBITDA of approx. $30-32 mln.
17:29  CMTL Comtech Telecom provides COVID-19 business update; withdraws outlook for fiscal year ending July 31, 2020 (13.29 -1.09)

  • Although deemed an essential business by the U.S. government, Comtech has modified its business practices with a view to the safety of its employees, customers, partners and suppliers.
  • To date, the primary impacts of the coronavirus pandemic on Comtech have been significant order delays and the inability of Comtech's sales and marketing personnel to travel and/or meet with customers. Due to travel bans and/or forced shutdowns at customer locations, Comtech has encountered difficulty in delivering products that had been previously ordered by its customers.
  • As a result of these conditions, Comtech has taken steps to reduce both direct and indirect costs at certain of its facilities. Additional cost reduction measures may be required.
  • In light of these developments, Comtech is withdrawing its guidance for the fiscal year ending July 31, 2020 previously issued on March 4.
  • Status of the Gilat Acquisition: Comtech's $800.0 mln secured credit facility has proceeded through full syndication and was oversubscribed. The recent price decline in Comtech shares will have no impact on the number of shares to be issued to Gilat shareholders as merger consideration because Gilat and Comtech agreed to a fixed exchange ratio under the merger agreement. Although the statutory waiting period under the Hart-Scott-Rodino Antitrust Improvements Act has expired, the transaction is still under the review of the Federal Antimonopoly Service of the Russian Federation.
17:25  MSG Madison Square Garden approves the spin-off of its entertainment businesses from its sports businesses; temporarily suspends construction of Las Vegas venue due to virus (212.02 -12.40)

  • Co approves the spin-off of its entertainment businesses from its sports businesses, which is expected to be completed in mid-April.
  • MSG will be a pure-play sports company and will change its name to Madison Square Garden Sports Corp. (MSG Sports), while the newly-formed entertainment company will be named Madison Square Garden Entertainment (MSG Entertainment).
  • The distribution will take place on April 17 to MSG stockholders of record as of the close of business on April 13. Each MSG common stockholder will receive one share of MSG Entertainment Class A or Class B common stock.
  • Beginning on April 9, MSG expects that its common stock will trade in two markets on the NYSE: in the "regular way" market under the symbol "MSG" and under the current name, "The Madison Square Garden Company", and in the "ex-distribution" market under the symbol "MSGS WI" and under the new name "Madison Square Garden Sports Corp."
  • Update on MSG Sphere Construction in Las Vegas: Co is currently building a state-of-the-art venue in Las Vegas, called MSG Sphere. The widespread global effects of COVID-19 have resulted in significant impediments to construction. As a result, the Company will implement a temporary suspension of construction, with all work ceasing over approximately the next two weeks. Co remains committed to building a state-of-the-art venue in Las Vegas and looks forward to quickly and efficiently resuming construction as soon as practicable. As a result of this delay, the Company does not expect to achieve its goal of opening the venue in calendar year 2021.
17:18  ASND Ascendis Pharma has filed an Investigational New Drug application amendment with the FDA to initiate its Phase 3 trial of TransCon hGH in subjects with adult growth hormone deficiency (112.61 -3.39)

 
17:15  OII Oceaneering Intl confirms Q1 guidance but is withdrawing its full-year 2020 guidance (2.91 -0.53)

  • Co is confirming its Q1 guidance but is withdrawing its full-year 2020 financial guidance.
  • Additionally, co expects to lower its organic capital expenditures for 2020 to between $60-80 mln and reduce its Unallocated Expenses.
17:12  C Citigroup postpones Investor Day that was set for May 13 due to virus (42.11 -1.98)

 
17:12  TROW T. Rowe Price approves 15 million share increase in the authorization to repurchase shares of its common stock (97.65 -1.18)

 
17:11  AKR Acadia Realty Trust withdraws FY20 guidance (12.39 +0.02)

  • Due to the economic uncertainty resulting from the COVID-19 pandemic, Acadia is withdrawing its full-year 2020 guidance which was previously announced on February 12, 2020.
  • There is currently no ground-up construction underway in Acadia's Core Portfolio. For the foreseeable future, the company expects that the only material capital expenditures at these properties will be tenant improvements and/or other leasing costs associated with executed leases. Acadia has no unsecured debt maturities it its Core Portfolio until March 2023. Acadia has no material scheduled secured debt maturities until 2023 in its Core Portfolio.
  • There is currently no ground-up construction underway in Acadia's Fund Portfolio. Inclusive of extension options, Acadia has no material secured or unsecured debt maturities in 2020 in its Fund Portfolio. The $200.0 mln City Point financing maturing in May 2020 has an extension option not sooner than May 2022.
17:08  HP Helmerich & Payne intends to reduce future quarterly dividends to $0.25/share from $0.71/share (15.65 +0.15)

  • As part of the company's commitment to long-term shareholder returns and at the same time maintaining its strong financial position, consistent with its previous announcement on March 23, 2020 that it was reviewing its capital allocation policy, the company announced it intends to reduce the future quarterly dividends to $0.25/share. The declaration and amount of any future dividends, and any future increase or decrease, is at the discretion of the Board of Directors.
  • H&P also reaffirms its commitment to pay the previously announced $0.71/share dividend on June 1, 2020, to stockholders of record at the close of business on May 11.
  • In light of the uncertainties related to COVID-19 and the significant negative impact that a weakened commodity price environment have had on the outlook for the industry rig count, H&P has preliminarily reassessed certain portions of its cost structure, including SG&A and capital expenditures, for the remaining six months of fiscal year 2020.
    • Gross capital expenditures are now expected to be approx. $210-30 million for the full FY20 and are still expected to include amounts for walking rig conversions backed by term contracts and certain in-process corporate projects, including information technology initiatives. Second half fiscal 2020 capital expenditures are expected to consist primarily of maintenance capital expenditures at an annualized level of approx. $1 mln per average active rig.
    • Asset sales include reimbursements for lost and damaged tubulars and sales of other used drilling equipment that offset a portion of gross capital expenditures and are now expected to be approx. $25-35 mln for the full FY20.
    • SG&A costs, excluding any future one-time items, for the full FY20 are now expected to be approx. $185 mln.
17:04  BERY Berry Global invests in meltblown capacity to produce high-efficiency filtration media serving the EMEIA markets (33.71 +0.16)

  • Berry Global has advanced its investment in an additional specialty meltblown asset to produce high-efficiency filtration media serving the EMEIA markets. Current projections are for commercial production to start in the June quarter of 2020.
  • This investment is targeted to meet increased demand and customer growth and will be focused on premium applications, such as FFP2 (N95) and FFP3 (N99) for industrial face mask and cabin air filtration markets. The new line will be equipped with Berry's proprietary charging technology to deliver optimal filtration efficiency and pressure drop at lower basis weights. Berry has a unique offering, providing products across technologies and markets. In this instance, the company is using its resources to provide the highest level of supply across Europe and more.
17:02  WSM Williams-Sonoma extends temporary closure of all US and Canada stores for an additional two weeks (42.54 -0.82)

  • Co will extend the temporary closure of all U.S. and Canada stores for an additional two weeks.
  • Co will continue to pay store associates for their scheduled time and provide benefits through these two weeks of extended closures.
  • All of Williams-Sonoma's corporate offices remain closed with associates working from home.
16:52  ECOL US Ecology announces capital preservation initiatives; temporarily suspends dividend; withdraws 2020 financial guidance (30.40 -0.35)

  • US Ecology today announced several capital preservation initiatives in response to current market volatility and economic uncertainty as a consequence of the COVID-19 pandemic. While it remains too early to quantify the potential impact on the company's financial performance, in response to these market circumstances, the company is proactively implementing cost control initiatives that are expected to generate approx. $15-20 mln of annual savings. The company also intends to reduce its planned 2020 capital expenditures by approx. 30%, which is expected to save up to $30 mln in cash.
  • US Ecology's Board of Directors has approved a plan to suspend quarterly cash dividends at this time, beginning with the second quarter of 2020 that was expected to be declared in April 2020.
  • Says CEO and Chairman Jeff Feeler, "To date, our core environmental services business has not been significantly impacted and is showing strong volumes and service revenue. However, as industrial facilities are forced to temporarily close and the labor force is reduced, we could see a downturn in 2020. Our services-based business is expected to remain stable and is showing growth as a result of our small quantity generation services and our leading emergency response business that has seen a significant uptick in COVID-19 decontamination services. Our energy waste disposal services business, however, will be impacted as energy companies reduce capital expenditures by up to 50% as a result of seventeen-year lows in oil prices."
  • As a result of uncertainty surrounding the magnitude and duration of the COVID-19 pandemic, the company is withdrawing its previously issued guidance for the year ended December 31, 2020.
  • The actions announced today are expected to allow the company to continue to generate positive cash flow even at lower than expected adjusted EBITDA levels.
16:49  BIDU Baidu announces proposed debt offering to repay certain indebtedness (100.79 +1.84)

  • BIDU announces that it has filed a preliminary prospectus supplement with the SEC under an automatic shelf registration statement on Form F-3, pursuant to which the company proposes to sell senior notes.
  • The company intends to use the net proceeds from the offering to repay certain existing indebtedness and for general corporate purposes.
16:49  DGX Quest Diagnostics provides update on COVID-19 impact; experienced material decline in testing volumes in March; withdraws FY20 guidance (80.30 -2.76)

  • As COVID-19 continues to spread and severely impact the economy of the US and other countries around the world, the company has made substantial investments to expand the amount of COVID-19 testing available to the country and is currently testing more than 30,000 COVID-19 tests per day. The company has also put preparedness plans in place at its facilities to maintain continuity of operations.
  • The company's operating results in January and February were consistent with the guidance for full year 2020 provided on January 30. However, in March, the company experienced, and anticipates it will continue to experience, a material decline in testing volumes due to the COVID-19 pandemic.
    • During the last two weeks of March, volumes declined in excess of 40% inclusive of COVID-19 testing.
    • Federal, state and local governmental policies and initiatives designed to reduce the transmission of COVID-19 have resulted in, among other things, a significant reduction in physician office visits, the cancelation of elective medical procedures, customers closing or severely curtailing their operations, and the adoption of work-from-home or shelter-in-place policies, all of which have had, and are expected to continue to have, an impact on the company's operating results, cash flows, and financial condition. It is possible that the Company will experience an adverse impact on cash collections from customers, clients and payers as a result of the impact of the COVID-19 pandemic.
  • At this time, the company cannot reasonably estimate the adverse impact the COVID-19 pandemic will have on its businesses, operating results, cash flows, and/or financial condition, but the adverse impact is likely to be material. The company is therefore withdrawing its previously announced guidance for full year 2020.
  • The company expects to release first quarter 2020 financial results on April 22.
16:43  CAC Camden National Corp. appointes Gregory A. White as CFO, effective April 15 (31.45 +1.45)

  • On March 31, Camden National Corp. appointed Gregory A. White as EVP and CFO, effective as of April 15. Mr. White will serve as the company's principal financial officer and principal accounting officer. Mr. White was also appointed EVP and CFO of the company's wholly-owned subsidiary, Camden National Bank. Prior to this appointment, Mr. White served from 2009 to 2018 as EVP, CFO, and Treasurer of Farmington Bank.
  • Deborah A. Jordan, the company's current CFO, will continue to serve in that role until the effective date of Mr. White's appointment.
16:41  NOC Northrop Grumman files mixed securities shelf offering (302.06 -11.47)

 
16:40  KBAL Kimball adjusts manufacturing operations to prioritize the needs of its healthcare business (11.91 +0.60)

  • KBAL is making some temporary shifts in its business operations to prioritize critically needed healthcare products for the crisis.
  • Its Kimball Health Brand has launched a family of Health Crisis Solutions: QUICK TRIAGE designed for quick diagnosis and patient sorting, CARETEAM WORK ENVIRONMENTS supporting temporary nurse stations and RAPID RESPONSE PATIENT ROOMS for makeshift facilities.
  • Its National Brand has also launched a grouping of Quickship Products specifically targeting facilities servicing the COVID-19 crisis.
  • With this decision, KBAL will temporarily adjust its manufacturing footprint to focus production within four of its ten U.S. manufacturing facilities.
16:37  XRX Xerox withdraws its offer to acquire HPQ (18.92 +1.01)

  • Co says the current global health crisis and resulting macroeconomic and market turmoil caused by COVID-19 have created an environment that is not conducive to Xerox continuing to pursue an acquisition of HP Inc. (HPQ). Accordingly, co is withdrawing its tender offer to acquire HPQ and will no longer seek to nominate its slate of candidates to HP's Board of Directors.
16:37  SIX Six Flags adopts short-term stockholder rights plan (12.54 -0.03)

  • Six Flags Entertainment's Board has approved the adoption of a short-term (one-year) stockholder rights plan to protect stockholder interests and maximize sustained value for all stockholders.
  • The company recently became aware of substantial activity in its stock. In addition, the Board has taken note that, in light of the COVID-19 pandemic and recent market events, there has been significant volume and volatility in the trading of company stock. The Board believes that the current trading price of company stock does not reflect the company's intrinsic value.
16:34  WTTR Select Energy Services details cost reductions due to virus (3.20 +0.36)

  • Co announces immediate strategic actions in response to the significant decline in activity following the rapid decline in commodity prices this month and the operational disruption and market volatility resulting from the COVID-19 pandemic.
  • Co expects to realize annualized SG&A savings of $25-30 million due to headcount and wage reductions across the employee base, including executive management, as well as significant curtailment or renegotiation of other internal and third-party expenses, with initial benefits realized in Q1.
16:34  PII Polaris Industries takes additional actions in response to the COVID-19, including furloughing most exempt and non-exempt employees for two weeks (48.15 +0.98)

In response to continued uncertainty in market demand and the escalating near-term impact of COVID-19, PII made the decision to enact several temporary changes related to employee compensation and hiring practices for exempt and nonexempt employees, including:

  • Delaying merit increases for exempt and nonexempt employees through the end of the year;
  • Implementing a hiring freeze on exempt and nonexempt positions;
  • Furloughing most exempt and non-exempt employees for two weeks in the second quarter. Employees will not be paid but will maintain their health care benefits and may be eligible for unemployment benefits, subject to federal, state, and local regulations;
  • Exempt and non-exempt employees, including PII's Executive Leadership Team, who are not furloughed will have their pay reduced by approximately 20% beginning April 13 through the end of the second quarter.

Additionally, the company is taking further action to increase financial flexibility and liquidity, including reviewing all operating expenses, postponing non-essential capital expenditures, and suspending share repurchases. The company has also elected to draw down an incremental $150 million under its current revolving credit facility.

16:29  MMM 3M provides details about capacity increases of N95 respirators (136.75 -1.06)

  • Co is announcing additional details about 3M's capacity increases of N95 respirators, strong measures to combat price gouging and counterfeiting, and new partnerships to help protect healthcare workers on the front lines.
  • As previously communicated, beginning in January co ramped up to maximum production of N95 respirators, doubling its global output to a rate of 1.1 billion per year, or 100 million per month.
  • This includes 35 million per month in the US, and over just the last seven days co has delivered 10 mln N95 respirators to healthcare facilities in states across the country.
  • Co has put into motion additional investments and actions that will enable it to double capacity once again, to 2 billion globally within the next 12 months -- and some of that additional capacity will begin to come online in the next 60-90 days.
  • In the US, co expects to be producing N95 respirators at a rate of 50 million per month in June, a 40% increase from current levels.
  • In the U.S., more than 90% of its N95 respirators are going to healthcare and public health, with the remaining deployed to other critical industries such as energy, food and pharmaceuticals.
  • Additionally, co is partnering with Ford (F) to bolster production of 3M's powered air purifying respirators (PAPRs), which are highly specialized pieces of equipment used in the most demanding healthcare environments. Goal is increasing PAPR production by six-fold within the next 60 to 90 days.
16:29  STAG STAG Industrial provides 2020 guidance in presentation slides (22.52 -0.32)

  • Sees cash same store NOI growth of 1.0-2.0%, including bad debt assumption of 50 bps.
  • Expects retention of 65-75%, including ~70 bps impact from top ten tenant move out.
  • Expects acquisition volume range of $800 mln to $1 bln and capital expenditure per average SF range of $0.27 to $0.31.
  • Sees net debt to run rate adjusted EBITDA of 4.75x to 6.00x.
16:27  TLRD Tailored Brands reopens e-commerce fulfillment centers, effective March 30 (1.74 +0.19)

  • After instituting enhanced social distancing and sanitation protocols that meet or exceed those recommended by the Centers for Disease Control and Prevention, the company reopened its e-commerce fulfillment centers effective Monday, March 30, and these centers have begun shipping online orders.
  • The company also announced that its factory in New Bedford, Massachusetts, in conjunction with a leading privately held manufacturer and distributor of medical supplies, will begin the production of cotton washable facemasks that can be used when an FDA approved mask is not available. The factory will use the manufacturer's material and specifications and provide the sewing. The company will bring back furloughed employees to make 50,000 masks over the next few weeks and will continue to look for additional opportunities to help front-line healthcare professionals.
16:23  ATI Allegheny Tech to idle joint venture plant (8.51 -0.21)

  • Co announces that its 50% owned A&T Stainless joint venture plans to idle its DRAP operations in Midland, PA by the end of June due to Section 232 tariffs that make the business unsustainable.
16:22  IFRX InflaRx doses first patient in trial investigating the safety and efficacy of IFX-1 in patients with severe COVID-19-induced pneumonia (3.82 +0.29)

  • InflaRx today announced the enrollment of the first patient into a randomized clinical trial investigating the safety and efficacy of IFX-1, the company's monoclonal anti-C5a antibody, in patients with severe COVID-19-induced pneumonia.
  • The company has received initial positive human data from two initial patients suffering from COVID-19-induced severe pneumonia who were treated with BDB-001, an anti-C5a antibody produced by BDB from the IFX-1 cell line, in China. Data from the two patients are part of a larger investigation on the role of complement activation in COVID-19 that have been made publicly available through a pre-print server and have not been independently validated by InflaRx.
  • Based on the company's existing pre-clinical research on the role of C5a in viral-induced pneumonia and the initial results from the BDB study, InflaRx has decided to initiate a clinical development program with IFX-1 in COVID-19 patients with severely progressed pneumonia. The company has received regulatory approval to start the trial in the Netherlands and enrolled the first patient at the Amsterdam University Medical Centers. Subject to regulatory approval, the company plans to initiate additional centers in Germany and potentially other European countries.
16:20  SYK Stryker withdraws Q1 and FY20 organic sales and EPS guidance (166.49 +3.53)

  • Stryker is withdrawing its first quarter and full year 2020 organic sales growth and earnings per share guidance, originally disclosed on January 28.
  • As the COVID-19 pandemic expands, unprecedented measures to slow the spread of the virus have been taken by local governments and health care authorities globally, including the deferral of elective medical procedures and social contact restrictions, which have had, and are expected to continue to have, a significant negative impact on Stryker's operations and financial results. Due to the uncertain scope and duration of the pandemic, and uncertain timing of global recovery and economic normalization, Stryker is unable to estimate the overall impacts on its operations and financial results, which could be material.
  • Stryker plans to provide additional information in its next earnings release and conference call, currently scheduled for April 30.
16:20  CTRN Citi Trends extends store closures, places employees on furlough (8.90 -0.29)

  • Co has extended its previously announced temporary closure of all of its retail stores, distribution centers and New York office until further notice.
  • The Savannah corporate office will also be temporarily closed for all but minimum basic operations.
  • Co has placed on furlough substantially all of its store and distribution center personnel, as well as about 40% of its corporate staff.
16:19  ORTX Orchard Therapeutics outlines COVID-19 impact on business (7.53 -0.06)

While the company continues to progress its development, regulatory, and commercialization plans, it also acknowledges the following impacts, among others, of COVID-19 on clinical activities, regulatory timelines, and commercial readiness efforts that are underway.

  • Orchard continues to engage with the European Medicines Agency (EMA) on the company's marketing authorization application (MAA) for OTL-200 for the treatment of MLD ( metachromatic leukodystrophy) under an accelerated assessment. While the company is still preparing for a potential approval in 2020, the timeline could be extended as a result of the coordination needed among EMA, the company, its clinical site, its manufacturing partners, and other key stakeholders involved in the review process.
    • Throughout the remainder of 2020, Orchard plans to continue its commercial preparation efforts in Europe, which include a focus on patient identification, disease awareness, site qualification, and market access activities. If approved, the commercial launch of OTL-200 in Europe is likely to occur in the first half of 2021 based on expected regulatory timelines.
    • The company now believes it is likely to submit the biologics license application (BLA) for MLD with the FDA in the first half of 2021.
  • OTL-101 for adenosine deaminase severe combined immunodeficiency (ADA-SCID): Based on COVID-19-related impacts at Orchard's clinical and manufacturing sites, the company does not expect to complete the necessary activities to enable initiation of its rolling BLA in the U.S. in the first half of 2020.
  • The U.S. and EU regulatory filings for the OTL-103 program in WAS remain on track for 2021.
  • While the company's clinical sites are still treating patients in studies for OTL-201, OTL-103, and OTL-200, these centers are devoting significant resources to patients with COVID-19, which could limit their ability to enroll additional patients in ongoing clinical studies.
16:19  SKT Tanger Factory withdraws 2020 guidance, draws down substantially all of its capacity under its $600 mln unsecured lines of credit (4.99 -0.23)

  • As a result of the COVID-19 pandemic, most of the stores in the company's outlet centers are currently closed, with many having already been so for two full weeks.
  • The company has limited visibility into the duration and magnitude of the pandemic. Given this level of uncertainty regarding the impact to its business, SKT is withdrawing its 2020 guidance.
  • To increase liquidity, preserve financial flexibility and help ensure that the company is able to meet its obligations for a sustained period of time until there is more clarity regarding the impact of the pandemic, SKT has drawn down substantially all of its capacity under its $600 million unsecured lines of credit.
  • The company has also taken steps to reduce cash outflows, including the reduction or deferral of certain operating and general and administrative expenses, as well as the deferral of the Nashville project and certain other planned capital expenditures.
  • SKT intends to pay its first quarter 2020 dividend, which was declared in January, as scheduled on May 15, 2020.
16:17  WRAPX Closing Stock Market Summary

The stock market ended the tumultuous first quarter in negative territory on Tuesday, while investors continued to assess the latest news on the coronavirus and the policies proposed to address its impact. The S&P 500 closed near session lows with a 1.6% decline after a brief stay in positive territory early in the session.

The Dow Jones Industrial Average lost 1.8%, the Nasdaq Composite lost 1.0%, and the Russell 2000 lost 0.5%.   

Notably, President Trump said a $2 trillion infrastructure bill should be included in the fourth part of a stimulus bill with U.S. interest rates near zero. Prior to the statement, Bloomberg reported that White House officials were looking into a $600 billion relief bill for mortgage markets, the travel industry, and state governments.

There was another story from a Bloomberg reporter that President Trump approved a proposal pushed for by some businesses to delay payment of certain tariffs by 90 days. An announcement could come as soon as this week. Market reaction was muted, although shares of Caterpillar (CAT 116.04, +4.33, +3.9%) likely benefited from the president's infrastructure proposal. 

Instead, quarter-end rebalancing contributed to the outperformance of the distressed energy sector (+1.6%) and, conversely, the sharp declines in the defensive-oriented utilities (-4.0%) and real estate (-3.3%) sectors.

On the coronavirus front, NIAID Director Dr. Fauci said there have been "glimmers of hope" that social distancing is helping to curtail the spread of COVID-19, but the situation remained dire with the number of infections continuing to rise in the U.S. On a related note, Texas Governor Abbott issued a "stay at home" order until May 4. 

Separately, the Fed established a repurchase agreement facility as an alternative source for foreign central banks to temporarily exchange their U.S. Treasury securities for U.S. dollars. This was simply the latest "whatever it takes" action by the Fed to support financial markets. 

U.S. Treasuries had a relatively quiet day, ultimately closing mixed and little changed. The 2-yr yield declined one basis point to 0.20%, while the 10-yr yield increased three basis points to 0.70%. The U.S. Dollar Index declined 0.2% to 98.99. WTI crude increased 1.5% to $20.52/bbl, although it was up more than 8% in the session. 

Reviewing Tuesday's economic data:

  • The Conference Board's Consumer Confidence Index for March dropped to 120.0 (Briefing.com consensus 110.0) from an upwardly revised 132.6 (from 130.7) for February. The March reading is the lowest since July 2017.
    • The key takeaway from the report is that the downturn was not as bad as feared; however, the prevailing expectation is that consumer confidence will get much worse due to the impact of the coronavirus and its effect on consumer attitudes about job security and income growth prospects.
  • The Chicago PMI decreased to 47.8 in March (Briefing.com consensus 40.0) from 49.0 in February.
  • The S&P Case-Shiller Home Price Index for January increased 3.1% following an upwardly revised 2.8% increase in December (from +2.9%).

Looking ahead, investors will receive the ISM Manufacturing Index for March, the ADP Employment Change Report for March, Construction Spending for February, the weekly MBA Mortgage Applications Index, and auto and truck sales for March on Wednesday. 

  • Nasdaq Composite: -14.2%
  • S&P 500: -20.0%
  • Dow Jones Industrial Average: -23.2%
  • Russell 2000: -30.9%
16:17  XYL Xylem withdraws guidance for Q1 and for the full year (65.19 -1.11)

  • Co withdraws guidance for Q1 and for the full year, because of the impact of COVID-19.
  • The rapid international spread of the disease, especially in recent weeks, has since disrupted commercial activity and supply chains more broadly.
  • "We have a strong balance sheet, healthy cash reserves and ready access to capital. We are also moving quickly to adapt our operating and capital spending."
16:16  VECO Veeco Instruments provides business update related to COVID-19; reports prelim Q1 revs in-line with consensus (9.57 -0.36)

  • On March 17, 2020, the co announced withdrawal of guidance for the first quarter ending March 31, 2020 due to the possible disruption of operations for Veeco as well as customers. "We subsequently determined that our operations are considered part of the critical and essential infrastructure defined by applicable government agencies. Consequently, we are currently permitted and are endeavoring to maintain manufacturing and supply chain operations during these uncertain times. We expect revenue for the quarter ending March 31, 2020 to be between $100 million and $105 million [vs. $103.53 mln S&P Capital IQ Consensus.]. We continue to monitor this dynamic situation and expect to provide further updates during our first quarter 2020 earnings conference call."
16:14  PRTA Prothena announces that baseline data from the Phase 2 PASADENA study will be provided at conference (10.70 +0.07)

  • Co announces that baseline data from the Phase 2 PASADENA study of prasinezumab in patients with early Parkinson's disease will be presented by Roche in an oral presentation at the Advances in Alzheimer's and Parkinson's Therapies AAT-AD/PD Focus Meeting (AAT-AD/PD), to be held virtually on April 2-5.
  • Prasinezumab is the focus of a worldwide collaboration between Prothena and Roche.
16:13  PLCE The Children's Place provides COVID-19 business update; extends temporary store closures; suspends capital return program (19.56 +0.29)

  • Based on direction from federal, state and local government and health officials, and to ensure the safety and well-being of its associates and customers, the company has suspended all store operations in the US and Canada beginning March 18: Until further notice from government and health officials, all of the company's stores remain closed. The company is not able to predict the timing of store re-openings at this time.
  • Store sales were planned to represent approx. 65% of Q1 fiscal 2020 revenue with a significant portion of sales planned for the months of March and April. Digital sales continue to accelerate, with quarter-to-date demand up double digits versus last year. The company has implemented strict safety protocols and additional compensation incentives at our distribution centers, allowing the company to continue to service its customers through its e-commerce sites.
  • The company is finalizing the execution of the accordion feature on its revolving credit facility, which will provide an additional $50 mln of liquidity; it is evaluating its options on approx. 600 store lease events occurring over the next twelve months; and it has temporarily suspended its capital return program, inclusive of share repurchases and dividends.
16:11  RARE Ultragenyx Pharma and REGENXBIO announce a new exclusive, worldwide license agreement, extending the companies' gene therapy partnership (44.43 +0.11)

  • REGENXBIO (RGNX) and Ultragenyx Pharmaceutical (RARE) announce a new exclusive, worldwide license agreement, extending the companies' existing gene therapy partnership.
  • Under the terms of the agreement, RRNX has granted RARE an exclusive, worldwide license, with rights to sublicense, to RGNX's NAV AAV8 and AAV9 Vectors for the development and commercialization of gene therapy treatments for a rare metabolic disorder.
  • In return for these rights, RGNX will receive an upfront payment of $7 mln, ongoing fees, milestone payments, and royalties on net sales of products incorporating the licensed intellectual property.
16:10  BB BlackBerry beats by $0.05, misses on revs (4.12 +0.21)

  • Reports Q4 (Feb) earnings of $0.09 per share, excluding non-recurring items, $0.05 better than the S&P Capital IQ Consensus of $0.04; non-GAAP revenues rose 13.2% year/year to $291 mln vs the $296.29 mln S&P Capital IQ Consensus.
  • Co says it will guide for FY21 on the call which starts at 5pm ET.
16:09  NVAX Novavax and Emergent BioSolutions (EBS) sign NanoFlu manufacturing agreement (13.58 -0.72)

  • Emergent BioSolutions today announced an agreement with Novavax whereby Emergent will provide molecule-to-market contract development and manufacturing (CDMO) services to produce Novavax's NanoFlu, its recombinant quadrivalent seasonal influenza vaccine candidate with its proprietary Matrix-M adjuvant. Novavax recently announced that NanoFlu met all primary objectives in its Phase 3 clinical trial evaluating immunogenicity and safety in adults aged 65 and older.
  • Emergent will provide drug substance manufacturing services, including technology transfer and process validation and performance qualification to pave the way for commercial manufacturing. This work will be conducted at Emergent's Baltimore Bayview location, where the COVID-19 experimental vaccine candidate of Novavax is also being produced. The collaboration allows for flexibility to deploy capacity towards an expanded COVID-19 program.
16:08  GWW Grainger draws down $1 billion from its unsecured revolving credit facility (248.91 -6.23)

  • Co announces that it elected to draw down $1 bln from its unsecured revolving credit facility. This is a proactive measure to increase the company's cash position and preserve financial flexibility in light of current uncertainty in the global markets resulting from the COVID-19 pandemic.
  • After the draw down, GWW expects to have approximately $1.5 bln of cash on hand and approximately $250 mln of available committed capacity remaining under the revolving credit facility.
16:07  VRNT Verint Systems misses by $0.05, misses on revs; does not provide guidance (43.00 +0.24)

  • Reports Q4 (Jan) earnings of $1.11 per share, excluding non-recurring items, $0.05 worse than the S&P Capital IQ Consensus of $1.16; revenues rose 2.7% year/year to $339.2 mln vs the $374.51 mln S&P Capital IQ Consensus.
  • "We had a successful FY20 and entered FY21 with a strong outlook. At this point, considering the rapidly changing conditions arising from COVID-19 and uncertainty about its potential impact, we are unable to provide guidance. In the event the global economy deteriorates due to the pandemic, we have a strong balance sheet with $3 billion of assets, including more than $550 million of cash and short-term investments. We believe we are well positioned to navigate the current environment, as we stay focused on supporting our customers and partners during this period."
16:07  BDX Becton Dickinson and BioMedomics announce launch of rapid serology test for detection of COVID-19 exposure (229.77 +6.90)

BD and BioMedomics, a privately held, North Carolina-based clinical diagnostics company, today announced the release of a new point-of-care test that can detect antibodies in blood to confirm current or past exposure to COVID-19 in as little as 15 minutes. The new test, developed and manufactured by BioMedomics, will be available through BD and distributed exclusively by Henry Schein (HSIC) to health care providers throughout the United States.
16:05  JAZZ Jazz Pharma sees limited financial impact today from COVID-19, but can't rule out future impact on its business and guidance (99.74 +0.14)

  • JAZZ provided an update regarding the impact of COVID-19 on its business and the actions it is taking to mitigate the spread of this virus.
  • Company sees a limited financial impact today, given its portfolio of differentiated products addressing chronic and life-threatening diseases. However, given the global economic slowdown, reduced field-based interactions with healthcare professionals and the uncertainty surrounding the scale and duration of the pandemic, the company, at this time, cannot rule out future impact on its business and associated guidance.
  • The company remains confident in its ability to supply its medicines to patients around the world and currently has ample supply to meet commercial needs well into the future, with the exception of Erwinaze (asparaginase Erwinia chrysanthemi). The manufacturer of Erwinaze continues to have supply disruptions unrelated to COVID-19.
  • Currently, the company expects adequate supply of lurbinectedin and JZP-258 to support the U.S. launches following potential U.S. Food and Drug Administration approvals.
  • JAZZ is working closely with the company's third-party manufacturers, distributors and other trusted partners to manage the supply chain activities and mitigate any potential disruptions to the company's product supply as a result of COVID-19. To date, all third-party manufacturers are continuing operations.
16:03  GIII G-III Apparel announces employee furloughs (7.70 +0.45)

  • Co will be furloughing approximately 60% of its wholesale operations segment employees, effective April 6.
  • All wholesale business furloughed employees will continue to receive existing healthcare benefits.
  • Co will be decreasing the number of its retail segment employees by over 80% through furloughs and staff reductions, effective April 6.

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