Daily Update — April 1, 2022 (Delayed)

By Logan D. Guest, MMT Founder

Premarket Analysis:

Futures were up slightly after yesterday's selling, but now as we approach market open, futures are starting to slide back to yesterday's close.

Today, we have some important updates for the options market and its effects on the broader equity markets. We can expect volatility to be a bit higher in today's session as opposed to the rest of the week as the SPY/QQQ both hold negative gamma positions after the last few trading sessions.

We look to 4525/4500 as a material option market support on SPX and anything below that would warrant a hedge or short position on broader equities as we lack support until the 4400 level. There is not really any major market support for SPX until it trades back over 4600 and finds support there while a close under 4600 is susceptible to a drop back into this “void” on Monday.

Note: Gamma is a measurement of risk that measures the rate of change in delta, over time. If delta is “speed”, then Gamma is “acceleration” for option pricing. — Seeking Alpha).

Ratings Changes:

Upgrades

• CDEV: Stifel Upgrades to Buy from Hold — PT $11.20 (from $8.40)
• CMA: Goldman Sachs Upgrades to Buy from Sell — PT $112 (from $102)
• CMA: JPMorgan Upgrades to Overweight from Neutral — PT $115 (from $108)
• FIVE: Citigroup Upgrades to Buy From Neutral
• TELL: Credit Suisse Upgrades to Outperform from Neutral — PT $8 (from $5.50)
• VRT: JP Morgan Upgrades to Overweight From Neutral — PT $18 (from $29)
• WYNN: Citigroup Upgrades to Buy from Neutral — PT $96.50 (from $98)

Premarket Gappers:

Gapping up:

• GME +14.6%, XSPA +7.1%, LI +5.6%, KOS +5.6%, BZUN +4.9%, HITI +4.6%, HYMC +3.9%, INDI +3.7%, NCNO +3.7%, FSR +3.6%, LEV +3.1%, PL +3.1%, OLN +3%, MAG +2.8%, HOOD +2.7%, GRIN +2.3%, RETA +2.1%, GTHX +1.8%, PPGH +1.7%, RTX+1.6%, HLX +1.5%, VMI +1%, VLTA +1%, AMZN+0.9%

Gapping down:

• BLND -24.9%, SPRO -24.1%, SLS -24%, RDW23.5%, DCT -12.3%, WEJO -7.9%, ALE -5.9%, RNGR -3.5%, ASTS -3%, BB -2.7%, IIPR -2.1%, ATCX -2.1%, CE -0.5%

Corporate News & Events:

• GameStop (GME 192.16, +35.58): +15.4% after announcing plans to seek approval for a 3.33-for-1 stock split for Class A shares.
• PNC (PNC 185.71, +1.26): +0.7% despite issuing downside Q1 revenue guidance. PNC shares fell 8.0% in the first quarter, so the guidance may have been priced in already.
• BlackBerry (BB 7.13, -0.33): -4.4% despite beating EPS estimates.
• Russia holds its ground near Kyiv despite pledge to withdraw troops in that area. Ukraine gains back control of Chernobyl nuclear plant. Virtual peace talks resume today, according to the New York Times
• Russia claims Ukraine’s helicopters attacked oil tanks in Belgorod, Russia, according to Bloomberg
• 2/10 Treasury spread went negative, which could be an indication of an upcoming recession, CNBC
• President Biden’s advisors acknowledge that his climate agenda is unlikely to become law amid political headwinds. Also, EPA authority could soon be blocked by the US Supreme Court, according to the New York Times

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Disclaimer: This is not financial advice or recommendation for any investment. The Content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.