1. House Speaker Kevin McCarthy (R-Calif.) is triumphant. Can Senate Majority Leader Chuck Schumer (D-N.Y.) pull his weight? Debt ceiling deal passes the GOP-controlled House. Moves to the Democratic-controlled Senate. Must be wrapped up and signed by President Joe Biden by Monday’s default deadline.
2. Stock futures are mixed as investors watch debt-ceiling developments and look ahead to Friday’s May employment report. ADP’s private-sector jobs report beat and pace of wage growth slows. The labor situation will also be a key focus of the Fed as central bank officials Wednesday talked about skipping an interest rate hike at their meeting later this month.
3. Oil steadies Thursday. But West Texas Intermediate crude finished May with its worst monthly performance (down more than 11%) since November 2021. A slide in crude oil prices has weighed on the Club’s three energy holdings: Coterra Energy (CTRA), Pioneer Natural Resources (PXD) and Halliburton (HAL). We wrote about what to expect at the OPEC+ meeting this weekend.
4. One day after breaking a three-session winning streak, it looks like there will be a lid on the Nasdaq at Thursday’s open. The hot AI trade has created haves and have-nots in tech. Haves include Club names Nvidia (NVDA), Microsoft (MSFT), Alphabet (GOOGL), Salesforce and Palo Alto Networks. The have-nots include former Club holding Qualcomm (QCOM), Intel (INTC), HP (HPQ).
5. Salesforce (CRM) shares want to come down despite the quarterly beat and guidance raise. But analysts are raising price targets, including JMP Securities to $275 per from $250. Monster margin increase and cash flow. Once again proves that this is a transformed company, balancing profitable growth at scale.
6. CrowdStrike (CRWD) seems too reliant on new business. Costly and can’t keep harvesting old business. MoffettNathanson lowers price target on the cybersecurity stock to $217 per share from $229. Keeps outperform (buy) rating). Some others raised their PTs. This is not as good as Palo Alto Networks (PANW).
7. Constellation (STZ) brews overtaking Bud Light as the No. 1 beer? Coming out of the quarter in spectacular fashion and putting disastrous cannabis and Ballast Point acquisitions behind them. In a recent commentary, we looked at the rise of STZ and its irreplaceable Mexican beers Corona, Modelo and Pacifico.
8. Barclays is figuring that Estee Lauder (EL) will pull a rabbit out of hat because it always does. Still cuts its price target to $210 per share from $230 on this once-glorious Club name. But the analysts keep their overweight (buy) rating on the prestige beauty stock.
9. Macy’s (M) cuts full-year guidance even as the struggling department store chain beat on quarterly earnings. Revenue was a tad short. Starting in late March demand weakened for discretionary spending. Incremental clearance markdowns. Promotional environment now. Nordstrom (JWN) is helped by Rack outlet stores. So the high-end department store does decent numbers. M down and JWN up.
10. Dollar General (DG) quarter was a huge disappointment and shares sink 10%. Earnings, revenue and same-store sales misses. Lots of bad stuff here including a big increase in inventories.
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