Nomura Slashes Micron’s Target to $8, Cites DRAM Oversupply

Micron is in an insane business. Just a few years ago, they were the toast of every hedge fund’s strategy room. Today they are the unwanted feces on the bottom of a shoe.

Nomura attempted to decapitate MU today, following an already harrowing start to 2016, by cutting the target to single digits.

“This particular factor affects Micron substantially,” said Anand Srinivasan, an analyst at Bloomberg Intelligence. “If the information coming from Asia is true and supply is not slowing down, that’s bad for the DRAM industry and particularly bad for Micron,” given that about 58 percent of its sales come from that business, he said.

“Memory suppliers are characterizing the environment as a perfect storm,” the note said. “While demand is weak, DRAM suppliers are also facing what we perceive as a prisoner’s dilemma. Rationally, it is in their best interest to cooperate, but Micron, Hynix and Samsung have no intention of bringing down utilization.”

Another ‘perfect storm’, eh? Enough with the fucking references to that stupid shithead movie where all of those asshole fishermen drowned because they were too ignorant to adhere to the laws of nature, and also weather forcasts.

Shares of MU have recovered much of its early morning drop, but still lower. More importantly, if what Nomura says is true, this stock, as well as many others in the semi space, are in for further downside.

The stock is now up 11% for the year and 13% over the past two weeks. This stock was left for dead in early February, when everyone was freaking out over China and the specter of their ghost cities not needing anymore of CAT’s tractors.

Apparently, rumors of Caterpillars demise have been greatly exaggerated.

The share price action of CAT has been synonymous with Chinese growth. In recent weeks, much of this rally has revolved around the idea that the Chinese economy wasn’t doing as poorly as people suspected. Couple that with the statements from the Fed, who, at the moment, are sounding more dovish, and you have a recipe in place for a sharp rally for stocks.

The only problem with all of this is that it’s 100% horseshit. The Fed are still very much interested in jacking rates until your brain spills out from your ears. China is a fantastic fraud and definitely slowing. Moreover, demand for coal and steel are waning and do not support the share price appreciation for CAT.

The very bottom of the barrel is appreciating with vigor this morning. It’s as if everyone has gone mad all at once.

Crude is ripping higher again, now converging upon $38, higher by almost 4%.

Steel stocks continue to squeeze higher, as indicated by the steel ETF.

Most impressively, and at the center of this chimerical lift, are the renewed lives in the share prices of the dregs of stock market society.

Inside Exodus, we run a momemtum screen, automatically, in what’s called ‘the grid’. Here are some of the names on the list.

It’s very easy to hate a rally born out of nowhere, beholden to nothing. Being a very active and astute student of this wretched market for nearly 20 years, I can tell you that markets will remain irrational longer than you can remain solvent, to borrow a famous phrase. I don’t think stocks deserve to trade higher. But it’s doesn’t matter what I think, right now.

All that matters in the immediate term is the sentiment of Joe Public and how he views the market over the next few days. Eventually, all of the news will come out and prices will adjust.

Oh the irony of a statistics firm not having their earnings and fucking statistics in order. If I was a competitor of SCOR, I’d poach all of their clients and more.

Word of advice for publicly traded companies out there: DON’T DELAY YOUR 10k.

Via Briefing.com

The co announced that it is delaying the filing of its Annual Report on Form 10-K for the year ended December 31, 2015. On February 19, 2016, the Audit Committee of comScore’s Board of Directors received a message regarding certain potential accounting matters. In response, the Audit Committee immediately commenced a review of the matters with the assistance of independent counsel and advisors. On February 29, 2016, comScore filed a Form 12b-25, Notification of Late Filing, with regard to the foregoing with the Securities and Exchange Commission. At the time of that filing, comScore expected that it would be able to file its Annual Report on Form 10-K within the 15-day extension period provided by the form.

comScore says its Audit Committee continues to work vigorously with its independent counsel and advisors to complete its internal review as soon as possible. On March 5, 2016, however, the Audit Committee advised comScore’s Board of Directors that it did not expect to finalize its review before March 15, 2016.

As a result, comScore has not finalized its financial statements pending completion of the review, and it is not in a position to file its Form 10-K until after the Audit Committee completes its review and comScore’s independent public accountants assess the conclusions of the Audit Committee in connection with their audit of comScore’s annual financial statements to be included in its Form 10-K.

On March 7, 2016, comScore amended its Form 12b-25, Notification of Late Filing, to indicate it would not file the Form 10-K prior to the extended deadline of March 15, 2016. comScore does not expect to make further comment regarding its Audit Committee’s review until its conclusion.

Given the ongoing internal review by its Audit Committee, comScore announced it is postponing its Investor Day, previously scheduled for March 16, 2016, until such review is concluded and comScore has filed its Form 10-K.

comScore’s Board of Directors also determined on March 5, 2016 out of an abundance of caution to suspend the company’s previously announced share repurchase program. This will be reevaluated following the completion of the internal review and the filing of comScore’s Form

Avoid.

Stocks are mildly lower, in a rather drab and drama less beginning to the trading week. The big outlier is iron ore and steel stocks, whose share are currently at the vanguard of speculative fervor, following an astounding and record setting 19% jump in prices.

Surely this has more to do with short covering than fundamental improvements. Nevertheless, the share prices of VALE, CLF, AKS, and many others in the space, are soaring.

The one notable pullback, at least in the early going, is NFLX. House of Cards made the online movie vendor, drawing huge numbers of streaming subscribers to see the praised Kevin Spacey series. Although the IMDB scores are high for season 4, I’ve never seen so much criticism for the series to date.

As such, weakness has permeated the offices of Frank Underwood and the Netflix share price.

The NASDAQ is off by 25 or so points early going.

The momemtum is definitely with the bulls. I wouldn’t be surprised to see the market reverse higher, although I don’t think it’s warranted.

This must really be getting Goldman Sachs pissed off, the iron ore-steel markets up 19% for the day and such. As an aside, I don’t believe I’ve ever blogged about the hot world of iron ore steel so much (pun intended), let alone three posts in a row.

Ore with 62 percent content delivered to Qingdao jumped 19 percent to $63.74 a dry metric ton, Metal Bulletin Ltd. data show. That’s the biggest gain in daily data going back to 2009 and the highest price since June. The surge was preceded in Asia by a rally in futures, with the most-active contract on Singapore Exchange Ltd. climbing 21 percent to $60 and prices on the Dalian Commodity Exchange rising by the daily limit.

“The iron ore and steel markets have gone berserk — they’ve departed from fundamentals and are heavily driven by sentiment,” Zhao Chaoyue, an analyst at China Merchants Futures Co. in Shenzhen, said before the Metal Bulletin price was published. “Investors are expecting further monetary easing by the Chinese government to boost steel demand.”

Iron ore related stocks are soaring overseas and also here in the pre-market. Shares of CLF and VALE are both up sharply and many others, like X, AKS, TCK, BHP, should follow in kind.

In light of tonight’s wonderful melt up in iron ore, Goldman Sach is screaming ‘supreme horseshit’ on the current bedazzling of steel stocks. They just don’t see it happening, unless of course something material changes in China.

“We are yet to find evidence of higher-than-expected steel demand – whether in the order books of individual steel producers or in the official data for new orders. Based on the information currently available, the seasonal increase in demand appears only marginally stronger than last year,” Goldman Sachs said.

“Barring a material increase in Chinese steel demand in the coming weeks, we believe steel production will decline in 2016 and seaborne demand has essentially peaked. The stream of announced production cuts is bound to resume, in line with long dated iron ore prices that have remained in the low to mid $30s for 2017 and beyond,” Goldman Sachs said.

China will not recover any time soon. Fade the rally.

Who would’ve guessed that in the midst of an epic commodity collapse, a bull market in iron ore mining and steel production would forge?

That’s precisely what’s happening now, as prices in Asia rip higher by 5% to 6 month highs.

Iron ore futures jumped to their daily limit of 407 yuan ($62.47) a metric ton on the Dalian Commodity Exchange, up 4.9 percent and the highest level in almost six months, while the SGX AsiaClear contract in Singapore advanced as much as 10 percent to $54.58 a ton.

Iron ore’s upswing this year has accompanied a revival in the price of other commodities including oil and industrial metals. China set an economic expansion target of 6.5 percent to 7 percent on Saturday, and to reach that goal the government will expand the money supply and permit a record high deficit. The nation will also subsidize cuts to excess capacity in industries such as steel and coal.

Iron ore prices rose “amid hope for further stimulus measures in China,” Australia & New Zealand Banking Group Ltd. said in a note Monday. “Policy makers there continue to advocate industry reform, with the Vice Finance Minister saying large steel and coal capacity cuts are an important element of the nation’s” supply-side reform.

This isn’t just an ordinary bounce. The ancillary heirs of this fortune being spilled onto the markets, the stock prices of these speciality companies, have soared–year to date. As a group, the media share price return for iron ore/steel stocks is upwards of 13%, compared to a negative 2.2% drop in the S&P 500.

Moreover, many of the gains in the subsequent industries have been much more impressive than the 13% otherwise suggests.

It’s a brazen bull market.

The forex business taking place between mainland China and Hong Kong is certainly responsible for this calamitous decline.

“The newspapers keep on saying the market is going down and buyers think they can get a cheaper house half a year later or one year later so are waiting,” said Thomas Fok, a property agent at Centaline Property Agency in Hong Kong’s upscale Mid-levels West district where he hasn’t made one sale this year.

Sure, blame it on the newspapers.

Property prices have declined 10 percent from their September highs amid uncertainty over the economy at home and in China, possible interest-rate increases and plans by the government to boost housing supply in the next five years. Senior Hong Kong government officials have ruled out relaxing property curbs, which include extra stamp duties and caps on mortgage levels

Rumors of Hong Kong’s real estate decline have not been wildly exaggerated.

S&P futures are down 8.

All of the panic and mania, starring the renewed collapse of commodities, forex markets gone wild, Federal Reserve induced apoplexy, have washed away with the sands of time. Over the past 15 trading days, the markets have, once again, accomplished immeasurable feats of greatness, dispatching all of the readers of Zerohedge into cesspools to die amongst the cess and the pools.

We are off just 2.2% on the S&P 500 and higher by 1.9% on the Dow for 2016. The political winds are blowing from the west, firmly in favor of the status quo with H. Clinton. The Republican Party is all but a checkered pants relic of yesteryear’s country club memory. These days are marked by grave injustices and propaganda designed to destroy the fabric of the country, for the benefit of a more global cadre of catamite ham and eggers. Many of you enjoy this brand of national suicide because you’re either too stupid to distinguish its malevolence or you’re wholly supportive of it.

Either way, stock markets rejoice in the fleecing of both the treasury and the American consumer. Henceforth, and providing the starkly puffed and helmeted face of H. Clinton remains in the pole position, markets should continue to grind higher, leveling the skeletal remains of short sellers with such a G force that their remains are reduced into dust.

Hip hip hooray.