ECONOMIC SILUET: Watch this defensive play, Jeff Gundlach’s key investing themes, and these REITs in trading tomorrow

TUE, DEC 06, 2022

The goal of this newsletter is to get you ahead of the next day of investing and trading. It's your first look at tomorrow and last look at today powered by the team of people who direct CNBC TV's stock market coverage.

Tomorrow's Top CNBC Stories Tonight

A defensive play when 2022 returns are hard to find

Despite NRG Energy falling 15% for its worst day since March 2021, the utilities sector outperformed on Tuesday. Names like Exelon, American Electric Power, and CMS Energy were up 1.5% or more. A quick screen of the sector shows a number of stocks that still have year-to-date gains and deliver above-average dividend yields:
Sempra Energy up 25% in 2022, dividend yields 2.8%
AES Corp. up 15%, yields 2.4%
Consolidated Edison up 14%, yields 3.2%
Atmos Energy up 12%, yields 2.5%
Pinnacle West up 10%, yields 4.5%
CenterPoint up 10%, yields 2.4%
American Electric Power up 8%, yields 3.4%
Exelon Corp. up 4%, yields 3.2%
Entergy up 4%, yields 3.7%
Xcel Energy up 2%, yields 2.8%

Partnership with activist investor Elliott lifts Pinterest shares

Pinterest got a slight boost in after-hours trading when it announced a partnership with Elliott Investment Management that includes an Elliott board seat. While still negative for 2022, the stock has far outperformed its social-media peers. That includes Snap, which is off by 80% in 2022, as well as the much-larger Meta Platforms, which is down 66% this year.

Pharma shares rise on tossed Zantac lawsuit

Drugmakers GSK, Sanofi, and Haleon gained at least 7% today after a federal judge threw out thousands of lawsuits related to heartburn drug Zantac. Those companies, and Pfizer, have marketed the drug, and Tuesday's decision alleviates some concerns about their liabilities, though they still face a number of lawsuits in state courts.

A painful month for Amazon

Amazon fell 3% Tuesday, extending its recent weakness. The stock is only around 2% above its 52-week low, which it hit in early November. Of the tech mega-caps, including Microsoft, Apple and Alphabet, Amazon is the only name in negative territory over the past month. Year-to-date, Amazon is off by more than 45% and headed for its worst year since 2000. If that holds, it will snap a 7-year win streak.

Ethan Kraft | CNBC Breaking News and Markets Producer
@ethan_kraft

Two key investing themes from Jeffrey Gundlach

Two big themes from the famous DoubleLine investor at the CNBC Financial Advisors' Summit Tuesday. Both are themes to follow over the next few weeks.
First, Gundlach recommended emerging market stocks as the dollar hits what he believes is a top. The iShares MSCI Emerging Market ETF (EEM) is 23% off its 52-week high.
Second, he said to watch for buying in January as investors look to snap up beaten-down stocks due to tax-loss selling over the next few weeks.

MongoDB soars in after-hours trading

The stock jumped roughly 27% in extended trading after the database software company reported quarterly results this afternoon.
Revenue for MongoDB was up 47% from the prior year.
The CEO will make his case for the company when he's on Tech Check at 11 a.m. ET on CNBC Wednesday.
The stock is down 0.5% over the past month and off by 39% in three months.
That's much worse than the SPDR S&P Software and Services ETF (XSW) which is up 3.25% in a month and down nearly 5% in three months.

A rocky road for REITs, particularly this name

Blackstone and Starwood's respective real estate income trusts have curbed redemptions.
It's hard to find a REIT that's up so far in December.
Some of the worst hit include a 13% drop for Vornado this month and a 9.3% decline for Boston Properties – which also recently hit a 52-week low. Host Hotels and Resorts is off 8% in December. Alexandria Real Estate Equities is down nearly 6% this month.
Jim Cramer hit the story and gave a great explainer and context at 6:16pm Tuesday night, focusing on the problems in the rental market. If you missed it, it's worth checking out online.

Regional banks in a slump

CNBC's market watcher Chris Hayes points out that Signature Bank and SVB Financial Group just hit 52-week lows Tuesday. Both are in the SPDR S&P Regional Banking ETF (KRE).
Signature Bank is down 12.6% in two days, and SVB Financial is off by 10.9% in that period. Both are down about 14% in December.
The KRE is off by about 6% in two days. It is 23.6% from the high set back in January.
Pinnacle Financial, Fifth Third, Valley National, Metropolitan Bank, Western Alliance, Truist and First Bancorp are all down double-digits in December

Rent the Runway results are coming

The company reports after the bell on Wednesday.
The stock is down 90% since its high almost a year ago. That's a big drop, but it's picked up 7% in the past week.
That entire industry has not been a good fit with investors.
Farfetch is 86% off the 52-week high.
Same for Allbirds, but the stock is up 6.6% in a week.
ThredUp is 93% from the 52-week high.
Stitch Fix is 86% from the 52-week high.

Lights, camera… problems with media stocks

Bob Bakish, CEO of Paramount Global, will be on "Squawk on the Street" Wednesday morning with David Faber.
Bakish warned investors about a less-than-great fourth quarter. The stock fell nearly 7% Tuesday.
Paramount is 54% off the March high but up 16.5% in a month. It's down 9.65% in the last four trading days.
The S&P Media and Entertainment sector is up about 11% in a month.