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Albemarle (ALB), lithium names plunge as supply storm merges with weakening demand. (00:25) SolarWinds (SWI), chief information security officer charged with fraud by SEC. (01:52) Jabil (JBL) to produce, sell Intel’s (INTC) silicon photonics components. (02:48)
This is an abridged transcript of the podcast.
Lithium miners Albemarle (NYSE:ALB), SQM (NYSE:SQM) and Livent (NYSE:LTHM) all closed lower in Monday’s trading – -5.2%, -4.6% and -3.1% respectively – as prices come under increasing pressure due to concerns of declining near-term demand and oversupply.
Al Root at Barron’s attributed the latest drop to events at a U.S. semiconductor maker, a Japanese battery maker, and a Chinese miner.
First, ON Semiconductor (ON), a key supplier of chips for automakers, issued downside guidance for Q4 revenues of ~$2B, below Wall Street estimates for nearly $2.2B, which sent the stock plunging nearly 22% on the day.
Second, battery maker Panasonic (OTCPK:PCRFY) cut its FY 2024 sales forecast to ¥8.4T, or ~$56B, down from a previous forecast for ~$57B, with sales at its energy division – which includes batteries and other products – lowered by ~15% to $5.9B, blamed in part on weakening demand for “high-end EVs.”
Third, Citi analyst Jack Shang downgraded Chinese lithium miner Tianqi Lithium to Sell from Buy, saying lithium ore “price trends weaker amid oversupply in upcoming years,” while cutting earnings estimates for 2023, 2024, and 2025.
SolarWinds (NYSE:SWI) and its chief information security officer were charged with fraud and internal control failures by the SEC on Monday.
The Securities and Exchange Commission said SolarWinds (SWI) and executive Timothy Brown defrauded investors by overstating the company’s cybersecurity practices and understating or failing to disclose known risks. The fraud is alleged to have happened from at least its October 2018 initial public offering through at least its December 2020 announcement that it was the target of a “massive” cyberattack dubbed “SUNBURST.”
In its filings with the SEC during this period, SolarWinds (SWI) allegedly misled investors by disclosing only generic and hypothetical risks when the company and Brown knew of specific deficiencies in the company’s cybersecurity practices as well as the increasingly elevated risks it faced.
Jabil (NYSE:JBL) will manufacture and sell silicon photonics components and modules for Intel (NASDAQ:INTC).
As part of a new agreement with the chip giant, Jabil said Monday it will also oversee the development of future generations of silicon photonics transceiver modules for Intel.
Financial details of the deal were not disclosed.
Press Release.
Other articles to look out for on Seeking Alpha:
Apple takes wraps off ‘scary fast’ Macs with M3 chips
Spirit Airlines plunges as investors hope for settlement with DOJ over JetBlue fades
X is now worth less than half of what Elon Musk paid to buy Twitter
Biden’s Alaska oil plan seen as major threat to future drilling – Bloomberg
On our catalyst watch for the day,
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Investor events scheduled include the 47th Annual Automotive Symposium in Las Vegas with companies including AutoNation (AN), AutoZone, (AZO) and Genuine Parts (GPC) attending.
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DOJ trial to block JetBlue (JBLU) purchase of Spirit (SAVE) starts.
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Kenvue (KVUE) IPO lockup expires.
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Denbury (DEN) shareholders vote for sale to Exxon (XOM).
U.S. stocks on Monday rebounded from a two-week sell-off that saw the Nasdaq (COMP.IND) and the S&P 500 (SP500) slip into correction territory. All three major averages ended more than 1% higher.
The Nasdaq (COMP.IND) advanced 1.16%. The S&P (SP500) added 1.20%. The Dow (DJI) rose 1.58% with a boost from McDonald’s (MCD).
All 11 S&P sectors closed in the green, with Communication Services and Financials topping the board.
Treasury yields were slightly higher on Monday. The 10-year yield (US10Y) was up 4 basis points to 4.89%. The 2-year yield (US10Y) was up 3 basis points to 5.04%.
Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are mixed. The Dow is up 0.3%, the S&P 500 is up 0.1% and the Nasdaq is down 0.1%. Crude oil is up 0.8% at nearly $83 a barrel.
In the world markets, the FTSE 100 is up 0.6% and the DAX is up 0.5%.
The biggest movers for the day premarket: Pinterest (NYSE:PINS) is up 16% following upbeat Q3 results, with average revenue per user rising 5% in the U.S. and Canada, 26% in Europe, and 16% in the rest of the world. And PetMed Express (NASDAQ:PETS) is down 27% after missing the consensus mark in Q2 results and suspending dividends, despite new customers growing by 25% Y/Y.
On today’s economic calendar,
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