In Asian Equity Markets Japan’s Nikkei index on Tuesday morning with semiconductor equipment manufacturers’ stocks hit by weakness in U.S. tech shares overnight, undercutting gains in financial stocks as banks and brokers. The Nikkei declined 0.5 percent to 22,599.67 in mid-morning trade. The broader Topix fell 0.2 percent to 1,783.47. MSCI’s broadest index of Asia-Pacific stocks outside Japan were little changed, with a fall in semi-conductor shares offset by gains in telecom and financial shares. In Greater China, the Shanghai Composite edged up 0.05 percent and the Hang Seng Index fell 0.33 percent.

 

In Currency Markets  the dollar fell on Tuesday, as investors waited to see how the next step of the U.S. tax reform legislation proceeds rather than extend the rise made by the dollar at the start of the week following the U.S. Senate’s approval of the tax bill. The euro was a shade higher at $1.1874  after losing 0.3 percent overnight. The dollar nudged up to 112.550 yen, but remained well off the 2-1/2-week high of 113.090 struck on Monday. The pound was 0.1 percent lower at $1.3465 after wide swings the previous day. The Australian dollar was 0.6 percent higher at $0.7639 and the New Zealand dollar firmed 0.45 percent to $0.6890. The dollar index against a basket of six major currencies eased 0.15 percent to 93.050.

 

In Commodities Markets oil markets nudged higher on Tuesday, buoyed by expectations of a decrease in U.S. crude stockpiles and after last week’s deal between OPEC and other crude producers to extend output curbs. International benchmark Brent crude futures were trading up 0.1 percent, from their last close at $62.51 per barrel. U.S. West Texas Intermediate crude futures were up 0.2 percent, at $57.59 per barrel. Spot gold was nearly unchanged at $1,275.24 an ounce. Meanwhile, silver was up 0.2 percent to $16.34 an ounce. Platinum was 0.4 percent higher at $927.30 an ounce and palladium was up 0.7 percent to $998.48.

 

In US Equity Markets  the Dow reached a record high on Monday, with banks and retailers rising and technology companies falling as investors realigned their portfolios in hopes of benefiting from expected corporate tax cuts. The Dow rose 0.24 percent to end at 24,290.05 points, while the S&P 500 lost 0.11 percent to 2,639.44. The Nasdaq Composite fell 72.22 points to end at 6,775.37. Media stocks rose after the Financial Times reported that Twenty-first Century Fox had resumed talks to potentially sell most of its assets to Walt Disney. Disney added 4.72 percent and Fox climbed 2.80 percent.  CVS Health shares lost 4.57 percent after the company agreed to buy Aetna for $69 billion in the year’s largest corporate acquisition.

 

In Bond Markets  U.S. Treasury yields fell on Monday but remained higher than their levels late on Friday, boosted by increased confidence that the U.S. Congress would enact tax cut legislation after the Senate passed a bill early Saturday. The 10-year note was down 5/32 in price, yielding 2.385 percent, up 2 basis points from its Friday close but around 3.5 basis points lower than its Monday opening.

 

 

Economic Calendar

• 10:30 GMT+0 UK Services PMI
• 14:30 GMT+0 CAD Trade Balance
• 16:00 GMT+0 US ISM Non-Manufacturing PMI

 

US Equity Upgrades

• ALEXANDRIA REAL ESTATE (ARE) UPGRADED TO BUY FROM NEUTRAL AT BOFA/MERRILL
• BALL CORP. (BLL) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT BMO CAPITAL
• BLUE APRON (APRN) UPGRADED TO EQUAL WEIGHT FROM UNDERWEIGHT AT BARCLAYS
• COPA HOLDINGS (CPA) UPGRADED TO HOLD FROM UNDERPERFORM AT SANTANDER
• COUSINS PROPERTIES (CUZ) UPGRADED TO BUY FROM NEUTRAL AT BOFA/MERRILL
• CRESTWOOD EQUITY (CEQP) UPGRADED TO BUY FROM NEUTRAL AT UBS
• EAGLE BANCORP (EGBN) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT KEEFE BRUYETTE
• EBAY (EBAY) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT BMO CAPITAL
• GLOBUS MEDICAL (GMED) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT WELLS FARGO
• GRUPO TELEVISA (TV) UPGRADED TO BUY FROM HOLD AT HSBC
• GRUPO TELEVISA (TV) UPGRADED TO NEUTRAL FROM SELL AT CITI
• HOST HOTELS (HST) UPGRADED TO BUY FROM NEUTRAL AT BTIG
• OWENS CORNING (OC) UPGRADED TO TOP PICK FROM OUTPERFORM AT RBC CAPITAL
• PALO ALTO NETWORKS (PANW) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT WILLIAM BLAIR
• PRESTIGE BRANDS (PBH) UPGRADED TO OUTPERFORM FROM MARKET PERFORM AT WILLIAM BLAIR
• RANDGOLD (GOLD) UPGRADED TO SECTOR PERFORM FROM UNDERPERFORM AT RBC CAPITAL
• ROYAL DUTCH SHELL (RDS.A) UPGRADED TO OUTPERFORM FROM NEUTRAL AT MACQUARIE
• SUPERNUS (SUPN) UPGRADED TO BUY FROM NEUTRAL AT JANNEY CAPITAL
• ULTRA CLEAN (UCTT) UPGRADED TO BUY FROM HOLD AT STIFEL
• ULTRAGENYX (RARE) UPGRADED TO BUY FROM HOLD AT JEFFERIES
• WATERS (WAT) UPGRADED TO EQUAL WEIGHT FROM UNDERWEIGHT AT MORGAN STANLEY

 

US Equity Downgrades

• CENTERPOINT ENERGY (CNP) DOWNGRADED TO NEUTRAL FROM BUY AT GUGGENHEIM
• CORPORATE OFFICE PROPERTIES (OFC) DOWNGRADED TO NEUTRAL FROM BUY AT BOFA/MERRILL
• K2M GROUP (KTWO) DOWNGRADED TO MARKET PERFORM FROM OUTPERFORM AT WELLS FARGO
• OLD DOMINION (ODFL) DOWNGRADED TO SELL FROM HOLD AT DEUTSCHE BANK
• PUBLIC STORAGE (PSA) DOWNGRADED TO UNDERPERFORM FROM NEUTRAL AT BOFA/MERRILL
• PYXIS TANKERS (PXS) DOWNGRADED TO HOLD FROM BUY AT MAXIM
• TECK RESOURCES (TECK)DOWNGRADED TO NEUTRAL FROM BUY AT CITI
• UPS (UPS) UPGRADED TO BUY FROM HOLD AT DEUTSCHE BANK
• VENTAS (VTR) DOWNGRADED TO UNDERPERFORM FROM MARKET PERFORM AT RAYMOND JAMES
• WARRIOR MET COAL (HCC) DOWNGRADED TO SECTOR PERFORM FROM OUTPERFORM AT RBC CAPITAL

 

US Equity Initiations

• AIG (AIG) INITIATED WITH A NEUTRAL AT GOLDMAN SACHS
• ALLSTATE (ALL) INITIATED WITH A NEUTRAL AT GOLDMAN SACHS
• AMERISOURCEBERGEN (ABC) INITIATED WITH A BUY AT DEUTSCHE BANK
• AON PLC (AON) INITIATED WITH A NEUTRAL AT GOLDMAN SACHS
• APELLIS (APLS) INITIATED WITH A BUY AT CITI
• APELLIS (APLS) INITIATED WITH AN OVERWEIGHT AT JPMORGAN
• ASURE SOFTWARE (ASUR) INITIATED WITH A BUY AT CRAIG-HALLUM
• CBTX (CBTX) INITIATED WITH A MARKET PERFORM AT KEEFE BRUYETTE
• CHUBB (CB) INITIATED WITH A BUY AT GOLDMAN SACHS
• CVS HEALTH (CVS) INITIATED WITH A BUY AT DEUTSCHE BANK
• DIPLOMAT PHARMACY (DPLO) INITIATED WITH A BUY AT DEUTSCHE BANK
• EXPRESS SCRIPTS (ESRX) INITIATED WITH A BUY AT DEUTSCHE BANK
• FIRST HORIZON (FHN) REINSTATED WITH AN EQUAL WEIGHT AT BARCLAYS
• HARTFORD FINANCIAL (HIG) INITIATED WITH A NEUTRAL AT GOLDMAN SACHS
• INFLARX (IFRX) INITIATED WITH AN OVERWEIGHT AT JPMORGAN
• INFLARX (IFTC)INITIATED WITH AN OUTPERFORM AT LEERINK
• IROBOT (IRBT) INITIATED WITH A NEUTRAL AT CITI
• MARSH & MCLENNAN (MMC) INITIATED WITH A NEUTRAL AT GOLDMAN SACHS
• MCKESSON (MCK) INITIATED WITH A BUY AT DEUTSCHE BANK
• MERIDIAN BANK (MRBK) INITIATED WITH A BUY AT DA DAVIDSON
• METROPOLITAN BANK (MCB) INITIATED WITH AN OUTPERFORM AT KEEFE BRUYETTE
• METROPOLITAN BANK (MCB) INITIATED WITH AN OVERWEIGHT AT JPMORGAN
• NETFLIX (NFLX) INITIATED WITH A BUY AT MONNESS CRESPI
• PROGRESSIVE (PGR) INITIATED WITH A CONVICTION BUY AT GOLDMAN SACHS
• RITE AID (RAD) INITIATED WITH A HOLD AT DEUTSCHE BANK
• SOGOU (SOGO) INITIATED WITH AN OUTPERFORM AT CREDIT SUISSE
• SUPERCOM (SPCB) INITIATED WITH A BUY AT H.C. WAINWRIGHT
• TRAVELERS (TRV) INITIATED WITH A SELL AT GOLDMAN SACHS
• WILLIS TOWERS WATSON (WLTW) INITIATED WITH A SELL AT GOLDMAN SACHS