Friday Watch

Evening Headlines

Bloomberg:                 

• China Steps Up Covid Tests as US Envoy Warns of Investment Chill.  
• China’s No. 2 Online Mall Warns Consumer Recovery Months Away.
• Spiraling Food Crisis Hits Sri Lanka as Farmers Abandon Fields.
• Recession Fear Sinks Stocks; Japan Yield Tops Band: Markets Wrap.
  
• Stock Traders Coming to Grips With a Fed as Baffled as They Are.
  
• US Junk-Bond Spreads Top 500 Basis Points in First Since 2020.  
• Citi’s $900 Million Revlon Gaffe Risks Getting Even More Painful.  
• Mortgage Surge Toward 6% Slams Brakes on Red-Hot Housing Market.  
• Real Estate Billionaire Stephen Ross Says Recession Would Drive People Back to Office.  
• It’s Not Exactly a Shortage, But Tampons Are Harder to Find Especially in These States.  
• Number of Underwater Russell 3000 Stocks Surges to Record.  
• Record US Homes Under Construction Raise Hope of Inventory Boost. 
• JPMorgan Strategists Say Stocks Imply 85% Chance of US Recession.   
• AMC Holders Rebuke CEO With Rejection of $19 Million Pay.  
• What’s Stagflation, and Why Is It Such a Worry Now?

Wall Street Journal:

• Investors Bet Big Wall Street Trade Will Unwind.
• Celsius Is Crashing, and Crypto Investors Are Spooked.
• ‘Bear Market’: From Cautionary Proverb to Finance Lingo.
• U.S. Economic Growth Shows Signs of Slipping.
• By Design, the Fed May Be Tightening Too Much.
• Three Money Mistakes to Avoid in a Bear Market.
• Mortgage Rates Hit 5.78%, Highest Level Since 2008.
• Russia Slashes Gas Flows, Aiming Economic Weapon at Europe.
• France, Germany, Italy, Romania Back Ukraine’s Bid for EU Membership.
• Illegal Border Crossings Hit Record in May.

Fox News:

• Pelosi pressed on Dems' abortion rhetoric as violence against churches, pro-life clinics on the rise.
• Catholic bishops urge politicians to address 'alarming rate' of vandalism against churches, clinics.
• Oil giant hits back after Biden threatens energy producers.

CNBC.com:

• Millennial millionaires are delaying home, car purchases due to inflation.
• A day after Powell’s assurances about the economy, markets are worried that ‘Fed breaks something’.
• Adobe shares move lower after full-year projections fall short.
• Airline stocks tumble as economic concerns overshadow travel surge.
• Everyone knows inflation is on fire. This is what’s really fueling it.
• Bitcoin falls, Celsius insolvency risk grows, and parallels to the 2008 recession: CNBC Crypto World. 
  

MarketWatch:                 

• The impact of skyrocketing gas prices on shopping trips could be as big as inflation.
  
• U.S. inflation expected to keep running hot: Traders see 4 straight months of roughly 9% or higher CPI readings.
  
• Wall Street is officially in a bear market — What strategists say investors should do.
  
• Bausch Health halts plan to IPO skin-care division, citing ‘challenging market conditions’.
  
• These 16 stocks in the S&P 500 crumpled at least 9% a day after the Fed raised rates.  
• Crypto crash: Celsius, Three Arrows potential contagion worries investors. Here’s what to watch.  
• As crypto crash deepens, here are 4 signs the worst could be yet to come.  
• ‘The economy is going to collapse,’ says Wall Street veteran Novogratz. ‘We are going to go into a really fast recession.’.  
• Four value-stock picks from a fund manager who steers clear of the energy sector.

Zero Hedge

• Chevron Hits Back, Says Biden Trying To "Impose Obstacles" To Energy Delivery.
• "The Country Is Going To Learn That A Recession Is Worse For Votes Than High Inflation". 
• Taiwan Touts "Ability To Attack Beijing" With Supersonic Cruise Missiles.
• Bill Gates & The Cognitive 'Frame' Game.
• Is Your Chinese Coffee Maker Spying On You? 
• Gasoline Demand Destruction Remains Elusive Despite Inflation.
• Millennials Are Responsible For More Of The "Great Resignation" Than Gen Z, New Survey Finds.
• Chevron Hits Back, Says Biden Trying To "Impose Obstacles" To Energy Delivery.
• California Can't Kick Its Fossil Fuel Addiction.
• Global stocks suffered after central banks hiked rates - Newsquawk Asia-Pac Market Open.
• Inmate "Offered Money" To Murder Ghislaine Maxwell: Court Filing.
• Hawkish central bank activity and weak data add to recessionary fears - Newsquawk US Market Wrap.
• Democrats "Would Rather Tesla Was Dead Than Be Alive And Non-Unionized": Elon Musk.
• One Bank Throws Up All Over The Fed's Latest Laughable Forecast.
• Joe Biden Read This: All You Need To Know About The US Refining Industry.
• Dow Dumps Below 30k As Huge OpEx Looms; Gold Gains, Greenback Gags.

Newsmax:  

• Trump Demands 'Equal Time' on TV to Spell Out 2020 Election Fraud Case.
• Biden: Tone Down Rhetoric Supporting Ukraine.
• Rep. McCaul: Iran Could Have Nuclear Bomb Within a Year.
• Taiwan Foreign Minister: China Preps for War, 'Very Threatening'.

TheGatewayPundit.com: 

• “That’s Not Science, That’s Conjecture” – Sen. Rand Paul On Fire After Fauci Admits ‘Not Enough Data’ to Show Booster Shots Reduce Hospitalization and Death in Children.
• King Hypocrite Obama to Install Massive 2,500 Gallons Propane Tank for his Seaside Home in Martha’s Vineyard.
• JUST IN: Incarcerated Creepy Porn Lawyer Michael Avenatti Pleads Guilty to Fraud, Tax Charges in California.
• RAND PAUL BRINGS THE FIRE! Grills Fauci on Royalties NIH Research Doctors Received from Vaccine Companies! (VIDEO).
• Walmart Cancels MyPillow — Reportedly Offers Ridiculous Excuse.
• White House Spox Confirms Joe Biden is Moving Forward with Plans to End Fossil Fuel Despite Soaring Gas Prices (VIDEO).
• Hollywood Actor Chris Evans Calls Critics of Lightyear’s Gay Kiss Including Muslims and Chinese as ‘Idiots’ Who Will ‘Die Off Like Dinosaurs’.
• Florida Woman Under FBI Investigation For Selling Ashley Biden’s Diary in Which Joe’s Daughter Recalls ‘Showers w/my Dad’.
• Oops! Report Shows Capitol Police Received First Warning About Jan. 6 Violence 2 WEEKS BEFORE Protests! — PELOSI TURNED DOWN NATIONAL GUARD.
• Joe Biden SHATTERS All Records of Migrants Entering The United States At Open Southern Border.
• Despite Ongoing Energy Crisis and Record Fuel Prices Nearly Every Day, Leftist Activists Sue Biden Administration to Block 3,500 Oil and Gas Permits.
• MSN Highlights Survey Showing ‘Severe COVID-19 Rare In Unvaccinated’ After Months Of ‘Safe And Effective’ Propaganda.

The Epoch Times: 

• ‘Fight Like Hell With a Smile on Our Faces’: CRT Debate Spurs Parents to Run for School Boards.
• Americans Warned of China Potentially Spying via Smart Coffee Makers: Researcher. 
  
• American Business Elites Have Become Lobbyists for China, Expert Says.

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 829,308 Reports(+3,855 from prior week) Through June 3rd, 2022.

SKirsch.com:

• Using the MGH numbers with our own VAERS queries, we have 247 cases per million doses from the MGH study divided by 5.97 cases per million doses from VAERS. 247/5.97 = 41. This suggests that the VAERS under-reporting factor (URF) is 41X.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New US Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
• Bloomberg.com:  International Travel Restrictions.  Case Graphs by State.
  
• NYTimes.com:  County Trends and Clusters. Local ICU Occupancy.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity(region).
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading 

• Asian equity indices are -2.25% to -1.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 140.75 +13.25 basis points. 

• China Sovereign CDS 90.25 +11.5 basis points.
  

• Bloomberg Emerging Markets Currency Index 50.74 -.13%.  
• Bloomberg Global Risk-On/Risk Off Index 4,430.0 +228.0 points.
• Volatility Index(VIX) futures 32.10 +.6%.
• Euro Stoxx 50 futures -.32%.

• S&P 500 futures +.12%.

• NASDAQ 100 futures +.29%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• None of note
  

After the Close:

• None of note
  

Economic Releases

9:15 am EST

• Industrial Production MoM for May is estimated to rise +.4% versus a +1.1% gain in April.
• Capacity Utilization for May is estimated to rise to 79.2% versus 79.0% in April.
• Manufacturing Production for May is estimated to rise +.3% versus a +.8% gain in April.
  

10:00 am EST

• The Leading Index for May is estimated to fall -.4% versus a -.3% decline in April.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Powell speaking, EU Economic Finance Ministers Meeting and the (CNC) investor day could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are lower, weighed down by commodity and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.