Sunday, December 10, 2017

Monday Watch

Today's Headlines
Bloomberg:
  • China Audit Finds Provinces Faked Data and Borrowed Illegally. China found some local governments inflated revenue levels and raised debt illegally in a nationwide audit, a setback for Beijing in its bid to boost the credibility of economic data after a run of scandals. Ten cities, counties or districts in the Yunnan, Hunan and Jilin provinces, as well as the southwestern city of Chongqing, inflated fiscal revenues by 1.55 billion yuan ($234 million), the National Audit Office said in a statement on its website dated Dec. 8.
  • Stocks in Asia Nudge Higher on Economy Optimism. Stocks in Asia made modest gains at the open after U.S. labor market figures lifted optimism in global growth, though trading promises to remain subdued as traders wind down going into the holiday season. Equity benchmarks advanced in Tokyo, closing on this year’s highs, and Seoul, while futures on Hong Kong markets signaled a firmer start. Data showed hiring increased by more than forecast in November and the unemployment rate held at a 17-year low paved the way for another U.S. interest-rate increase this week. The S&P 500 Index and Dow Jones Industrial Average closed at all-time highs on Friday in light volume. The dollar held on to last week’s gains as President Donald Trump prepares to give a closing argument for the proposed tax reform on Wednesday. Bitcoin futures began trading in Chicago, while the spot price gyrated. The Topix index added 0.2 percent as of 9:18 a.m. in Tokyo. The Nikkei 225 Stock Average gained 0.2 percent. Australia’s S&P/ASX 200 Index fluctuated. South Korea’s Kospi index rose less than 0.1 percent.
Wall Street Journal: 
Night Trading
  • Asian indices are -.25% to +.75% on average.
  • Asia Ex-Japan Investment Grade CDS Index 72.5 -.25 basis point.
  • Asia Pacific Sovereign CDS Index 14.25 unch.
  • Bloomberg Emerging Markets Currency Index 73.03 +.04%.
  • S&P 500 futures +.05%.
  • NASDAQ 100 futures +.16%.

Earnings of Note
Company/Estimate
  • (CASY)/1.40
  • (NX)/.29
Economic Releases   
10:00 am EST
  • JOLTS Job Openings for October.
Upcoming Splits
  • (NSP) 2-for-1
Other Potential Market Movers
  • The Japan CPI report, $24B 3Y T-Note auction, $20B 10Y T-Note auction and the HSBC Real Estate Conference could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by technology and industrial shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the week.

Weekly Outlook

BOTTOM LINE: I expect US stocks to finish the week modestly higher on tax reform hopes, yen weakness, seasonal strength, buyout speculation, short-covering and economic optimism. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 100% net long heading into the week.

Saturday, December 09, 2017

Today's Headlines

Bloomberg:
  • China Factory Inflation Eases as Consumer Prices Remain Subdued. The producer price index rose 5.8 percent in November from a year earlier, matching the projection in a Bloomberg survey and slowing from 6.9 percent in October. The consumer price index climbed 1.7 percent, the National Bureau of Statistics said on Saturday, less than the median forecast of 1.8 percent.
  • It Could Be a Perfect Year for the Stock Market. Bouncing technology shares are putting a perfect year back within reach of the U.S. stock market. While short of a recovery, the advance in the market’s biggest industry has helped the S&P 500 Index rebound from four days of losses at the start of the month. The FANG group of Facebook Inc., Amazon.com Inc., Netflix Inc. and Google parent Alphabet Inc. gained 1.4 percent over five days, retracing two-fifths of the worst weekly loss in five months.
  • Bitcoin `Looks Remarkably Like A Bubble,’ New Zealand's Central Banker Warns. Bitcoin’s spectacular gains look like a speculative bubble and the cryptocurrency is too unstable to be useful in the future, New Zealand’s central banker said. “It looks remarkably like a bubble forming to me,” Reserve Bank of New Zealand Acting Governor Grant Spencer said in interview with TVNZ broadcast on Sunday. “Over the centuries we’ve seen bubbles, and this appears to be a bit of a classic case. With a bubble, you never know how far it’s going to go before it comes down.”
Wall Street Journal: 
Zero Hedge:

Friday, December 08, 2017

Weekly Scoreboard*

S&P 500 Index 2,648.04 +.33%

















 




The Weekly Wrap by Briefing.com.
 
Indices
  • DJIA 24,300.90 +.28%
  • NASDAQ 6,837.73 +.07%
  • Russell 2000 1,522.91 -.68%
  • S&P 500 High Beta 41.90 +1.39%
  • Goldman 50 Most Shorted 138.92 +1.0%
  • Wilshire 5000 27,410.65 +.21%
  • Russell 1000 Growth 1,340.84 +.45%
  • Russell 1000 Value 1,209.06 +.16%
  • S&P 500 Consumer Staples 579.91 +.34%
  • Vanda Cyclicals-Defensives 1.4026 +.16%
  • NYSE Technology 1,687.21 +.20%
  • Transports 10,404.10 +2.38%
  • Utilities 754.82 -1.49%
  • Bloomberg European Bank/Financial Services 100.65 +2.79%
  • MSCI Emerging Markets 45.73 -.51%
  • HFRX Equity Hedge 1,244.14 -.92%
  • HFRX Equity Market Neutral 1,009.69 -.14%
Sentiment/Internals
  • NYSE Cumulative A/D Line 310,243 -.13%
  • Bloomberg New Highs-Lows Index -9 -964
  • Bloomberg Crude Oil % Bulls 28.89 +58.91%
  • CFTC Oil Net Speculative Position 609,833 +5.68%
  • CFTC Oil Total Open Interest 2,489,012 -.92%
  • Total Put/Call .94 +22.1%
  • OEX Put/Call 2.89 +188.7%
  • ISE Sentiment 98.0 -5.45%
  • NYSE Arms .59 -37.5%
  • Volatility(VIX) 9.70 -15.84%
  • S&P 500 Implied Correlation 36.81 -3.64%
  • G7 Currency Volatility (VXY) 7.45 +.13% 
  • Emerging Markets Currency Volatility (EM-VXY) 7.96 +1.14%
  • Smart Money Flow Index 20,272.27 -1.51%
  • ICI Money Mkt Mutual Fund Assets $2.807 Trillion +.3%
  • ICI US Equity Weekly Net New Cash Flow -$4.507 Billion
  • AAII % Bulls 36.9 +2.6%
  • AAII % Bears 34.2 +8.2%
Futures Spot Prices
  • CRB Index 185.02 -3.01%
  • Crude Oil 57.32 -1.84%
  • Reformulated Gasoline 171.66 -1.0%
  • Natural Gas 2.77 -9.32%
  • Heating Oil 192.92 -.39%
  • Gold 1,250.20 -2.67%
  • Bloomberg Base Metals Index 193.98 -2.71%
  • Copper 297.70 -3.80%
  • US No. 1 Heavy Melt Scrap Steel 258.33 USD/Metric Tonne unch.
  • China Iron Ore Spot 502.0 CNY/100 Metric Tonnes -8.06%
  • Lumber 427.20 -1.76%
  • UBS-Bloomberg Agriculture 1,004.25 -2.88%
Economy
  • Atlanta Fed GDPNow Forecast +2.9% -60.0 basis points
  • ECRI Weekly Leading Economic Index Growth Rate 2.9% +30.0 basis points
  • Philly Fed ADS Real-Time Business Conditions Index .2507 -5.5% 
  • US Economic Policy Uncertainty Index 91.59 +10.76%
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 144.63 +.17%
  • Citi US Economic Surprise Index 65.2 +5.1 points
  • Citi Eurozone Economic Surprise Index 60.10 -10.2 points
  • Citi Emerging Markets Economic Surprise Index 8.7 +6.9 points
  • Fed Fund Futures imply 0.0% chance of no change, 100.0% chance of 25 basis point hike on 12/13
  • US Dollar Index 93.93 +1.12%
  • MSCI Emerging Markets Currency Index 1,643.56 -.23%
  • Euro/Yen Carry Return Index 139.18 +.05%
  • Yield Curve 58.50 -1.5 basis points
  • 10-Year US Treasury Yield 2.38% +2.0 basis points
  • Federal Reserve's Balance Sheet $4.397 Trillion -.01%
  • U.S. Sovereign Debt Credit Default Swap 23.77 -4.12%
  • Illinois Municipal Debt Credit Default Swap 336.78 -.06%
  • Western Europe Sovereign Debt Credit Default Swap Index 3.44 -1.15%
  • Asia Pacific Sovereign Debt Credit Default Swap Index 14.23 +3.19%
  • Emerging Markets Sovereign Debt CDS Index 43.05 -6.02%
  • Israel Sovereign Debt Credit Default Swap 58.21 +2.96%
  • South Korea Sovereign Debt Credit Default Swap 57.27 -1.42%
  • Russia Sovereign Debt Credit Default Swap 130.21 -2.50%
  • iBoxx Offshore RMB China Corporate High Yield Index 145.89 +.20%
  • 10-Year TIPS Spread 1.90% +2.0 basis points
  • TED Spread 26.0 +3.0 basis points
  • 2-Year Swap Spread 19.5 +1.25 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -60.75  -13.0 basis points
  • N. America Investment Grade Credit Default Swap Index 51.10 -1.33%
  • America Energy Sector High-Yield Credit Default Swap Index 373.0 +.82%
  • European Financial Sector Credit Default Swap Index 45.85 -3.21%
  • Emerging Markets Credit Default Swap Index 177.42 -2.11%
  • CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 160.0 unch.
  • M1 Money Supply $3.639 Trillion +.13%
  • Commercial Paper Outstanding 1,052.70 +.9%
  • 4-Week Moving Average of Jobless Claims 241,500 -750
  • Continuing Claims Unemployment Rate 1.4% unch.
  • Average 30-Year Mortgage Rate 3.94% +4.0 basis points
  • Weekly Mortgage Applications 408.30 +4.69%
  • Bloomberg Consumer Comfort 52.3 +.7 point
  • Weekly Retail Sales +3.0% -50.0 basis points
  • Nationwide Gas $2.47/gallon -.02/gallon
  • Baltic Dry Index 1,679 +3.26%
  • China (Export) Containerized Freight Index 763.14 -1.25%
  • Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 25.0 unch.
  • Rail Freight Carloads 292,443 +25.36%
Best Performing Style
  • Large-Cap Growth +.5%
Worst Performing Style
  • Small-Cap Value -1.0%
Leading Sectors
  • Retail +3.2%
  • Road & Rail +2.7%
  • Airlines +2.5%
  • Steel +2.1%
  • Educaiton +2.0%
Lagging Sectors
  • Medical Equipment -1.6% 
  • Shipping -2.4%
  • Oil Service -2.6%
  • Telecom -2.7%
  • Gold & Silver -3.6%
Weekly High-Volume Stock Gainers (21)
  • MDGL, ENTL, BGC, VRA, LE, SCMP, AVAV, GEF, TITN, RVNC, AMWD, FMI, MGLN, NCS, GIII, RGC, FSLR, KLXI, AMBA, HOME and OXM
Weekly High-Volume Stock Losers (21)
  • NYT, GRBK, BL, HOFT, TOL, VIVO, COUP, GCO, HQY, VEEV, VRNT, QRVO, EIX, TMST, TROX, EGBN, DLTH, TRHC, AGX, OSIS and IDT
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