Stocks Modestly Lower into Final Hour on Rising Long-Term Rates, Year-End Positioning, Technical Selling, Tech/Alt Energy Sector Weakness

Economic/Market Gauges:

• North American Investment Grade CDS Index 50.0 unch.
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .26 unch.
• BofA Global Financial Stress Indicator -.28 +1.0 basis point
• European Financial Sector CDS Index 54.2 -.02%
• Emerging Market CDS Index 124.3 -.4%
• Bloomberg Global Trade Policy Uncertainty Index 2.2 -.1

• Citi US Economic Surprise Index 14.4 +6.1 points

• Citi Eurozone Economic Surprise Index 32.6 +.1

• Citi Emerging Markets Economic Surprise Index 30.6 +1.5 points 
• S&P 500 Current Quarter EPS Growth Rate YoY(16 of 500 reporting) +32.8% unch.
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 310.36 +.10:  Growth Rate +15.3% +.1 percentage point, P/E 22.2 unch.
• S&P 500 Current Year Estimated Profit Margin 13.50% unch.
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) +n/a +n/a
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 484.65 +.19: Growth Rate +18.0% +.1 percentage point, P/E 32.8 -.1
• Bloomberg US Financial Conditions Index .77 unch.
• US Yield Curve 69.0 basis points (2s/10s) +1.75 basis points 
• Bloomberg Industrial Metal Index 163.4 -.7% 
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 28.8% unch.
• US Atlanta Fed GDPNow Q4 Forecast +3.0% unch. 
• US 10-Year T-Note Yield 4.17% +5.0 basis points
• 1-Year TIPS Spread 2.29 -4.0 basis points

• Highest target rate probability for March 18th FOMC meeting: 49.9% (+.8 percentage point) chance of 3.5%-3.75%. Highest target rate probability for April 29th meeting: 45.2%(-.1 percentage point) chance of 3.25%-3.5%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +450 open in Japan 
• China A50 Futures: Indicating -19 open in China

• DAX Futures: Indicating +200 open in Germany

Portfolio:

• Slightly Lower: On losses in my consumer discretionary/tech/industrial sector longs
• Disclosed Trades: None
• Market Exposure: 75% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Growth -.4%

Sector Underperformers:

• 1) Computer Services -1.3% 2) Gold & Silver -.9% 3) Digital Health -.9%

Stocks Falling on Unusual Volume: 

• LB, NCDL, CCAP, IDR, AFJK, QXO, PSLV and CORT

Stocks With Unusual Put Option Activity:

• 1) XME 2) CORT 3) BTBT 4) CCIR 5) SIRI

Stocks With Most Negative News Mentions:

• 1) CORT 2) WDC 3) NIO 4) NEM 5) CPNG

Sector ETFs With Most Negative Money Flow:

• 1) XBI 2) PPA 3) ARKK 4) VHT 5) VGT

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Growth -.2%

Sector Outperformers:

• 1) Nuclear +.4% 2) Biotech +.4% 3) unch.

Stocks Rising on Unusual Volume:

•  AXSM, ONDS, UMAC, DJT, PSNY, APLD, AFJK, PHVS, NKE, LPTH, HYMC and PVLA

Stocks With Unusual Call Option Activity:

• 1) AMLP 2) VNDA 3) EU 4) EVLV 5) PRMW 

Stocks With Most Positive News Mentions:

• 1) VNDA 2) NKE 3) AMRN 4) ONDS 5) ANGH

Sector ETFs With Most Positive Money Flow:

• 1) XLF 2) XLP 3) SOXX 4) SIL 5) XLC

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume

Friday's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open:

• None of note

After the Close: 

• None of note

Economic Release 

9:45 am EST

• Final S&P Global US Manufacturing PMI reading for Dec. 

10:00 am EST

• Construction Spending MoM for Oct. 

Upcoming Splits

• None of note

Other Potential Market Movers

• The weekly MBA Mortgage Applications report and Fed's weekly balance sheet report could also impact global trading on Friday.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -50.8% Below 100-Day Average 
• Nasdaq/NYSE Volume Ratio 14.4 -3.2
• 10 Sectors Declining, 0 Sectors Rising
• 27.1% of Issues Advancing, 70.3% Declining 
• TRIN/Arms .83 -12.6%
• Non-Block Money Flow -$102.3M
  
• 32 New 52-Week Highs, 34 New Lows
• 59.8% (-3.5%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 57.2 -4.4

Polymarket:

• Supreme Court Rules in Favor of Trump's Tariffs? 30.0% -1.0 percentage point
• Will there be another US government shutdown by January 31st? 28.0% +2.0 percentage points
• Will China invade Taiwan by end of 2026? 12.0% -1.0 percentage point
• US-Venezuela military engagement by Jan. 31st 24.0% unch.

Other:

• Bloomberg Global Risk-On/Risk-Off Index 97.8 -.3%
• US High-Yield Tech Sector OAS Index 423.75 -5.5 basis points
• Bloomberg Cyclicals/Defensives Index 265.25 +.1%
• Morgan Stanley Growth vs Value Index 159.7 +.1%
• CNN Fear & Greed Index 47.0 (NEUTRAL) -3.0
• 1-Day Vix 8.5 -16.1%
  
• Vix 14.7 +2.4%
  
• Total Put/Call .90 +8.4%

Wednesday Watch

Around X:

• @Business  

• China’s factory activity surprised with an expansion in December, snapping an eight-month contraction streak that was the longest slump on record.
• China has bought at least 8 million tons of US soybeans this year, according to people familiar with the matter, putting the world’s top importer on track to meet a pledge it made two months ago as part of an apparent trade truce with Washington. 
• CME Group will raise margins on precious-metal futures for the second time in the space of a week following a volatile period of trading that saw prices spike then retreat.
• Elon Musk’s xAI is planning an expansion of its data center complex in Memphis, and has purchased a large warehouse in Southaven, Mississippi, where it intends to build an adjoining facility, the Information reported. 
• Get up to speed on what's moving global markets.
• Here's what you need to know to start your day.  

• @ZeroHedge

• My courageous compatriots, Your presence in the streets across Iran has kindled the flame of a national revolution. The continuation and expansion of your presence, and taking control of the streets, is today our foremost, vital priority...
• Hollywood Blamed The Fans For Their Failures And Now They Face Collapse.
• There it is: Audrey Hale, the trans kiIIer who kiIIed 6 in a Christian school, was targeting Christians and White kids. Biden's FBI buried this: That is what happens when anti-White hatred is pushed in America.
• Journalists complaining about how someone else is doing their job for them because they refuse to do it is a fun part of all of this.
• America Is Arguing About Free Speech... The World Is Putting People In Prison For It.
• "Significant Safety Concerns" After Salem, Oregon Appoints Convicted Killer To Public Safety Boards.  
• You can't afford another kid because childcare is so expensive—but Somali fraudsters got millions of your taxpayer dollars for child care centers that don’t exist. You can’t afford a home—but 100 Somalis spent millions of your taxpayer dollars on luxury properties. You’re paying $30K a year for terrible health care—while they got millions of your taxpayer dollars for health care centers they never opened. That's the Democratic elites in a nutshell: You come last. And if you object, they call you racist. 
• The avg fundamental long/short Hedge Fund underperformed the S&P 500 by 200bps: Goldman.
• Only 28% of large cap mutual funds are outperforming their benchmarks, the lowest since 2019.  
• Yale No Longer Has A Single Republican Professor Across 27 Departments.
• From Tax-Cuts To Tariff-Stability: US Economy Poised For Solid Growth In 2026.
• Bitcoin & Bullion Bounce Back From Bloodbathery, Stocks Snooze As Santa Surge Stalls. 

• @CNBC

• Asia-Pacific markets set to trade flat in year-end trade.
• Stock futures are little changed, as Wall Street readies to close out the third year of a bull market: Live updates.
• Wednesday's big stock stories: What’s likely to move the market in the next trading session. 
• 'Consumer stimulus will stabilize the labor market,' says Bank of America's Aditya Bhave with his 2026 economic outlook.

• @MarioNawful

• JOURNALIST EXPOSES MINNESOTA “HEALTHCARE” SCAMMER BILLING MEDICAID FOR FAKE PATIENTS AND FAKE CLINIC. The researcher Dustin Grage recorded a video that shows the scam: Mohamed Mohamed ran a “healthcare” company that billed Medicaid for people he never met, never treated, and who never even signed up for services. When Grage checked the address listed for the business, the place was completely deserted. No staff, no patients, just dead silence and a sketchy mailbox. The scam? Bill the government for therapy sessions and medical services that never happened, using names of people who say they had no idea they were clients.

• @TheSCIF

• MILITARY whistleblower and election investigator expose an ENORMOUS amount of ELECTION FRAUD in the 2020 ELECTION in Fulton County, Georgia, which also involves the Georgia Secretary of State and the Georgia Attorney General. First, we'll start with the confirmed findings from the election investigator in Fulton County, Georgia: (video)

• @ElonMusk

• TRUMP ADMIN SUES VIRGINIA FOR GIVING IN-STATE TUITION TO ILLEGAL IMMIGRANTS WHILE AMERICANS PAY FULL PRICE. It’s official: the Trump administration is taking the state of Virginia to court, filing a lawsuit to block the University of Virginia from offering in-state tuition to illegal aliens, a move that directly challenges how states distribute taxpayer-funded benefits. The reason is that the Democratic Party is buying their vote.

• @Wiseman_Cap

• Goldman’s Top Themes for 2026.
• Morgan Stanley Picks for 2026. 

• @johnrockshomes

• I am a J6er. Entrapment happened when the doors were opened, and we were let in and given tours while feds in the crowd led the way. Murder was committed when Michael Byrd shot an unarmed protester and Lila Morris beat another one to death. Incitement occurred when the peaceful crowd was fired upon with flashbangs and rubber bullets to the face. A miscarriage of justice took place when Americans were charged with assault against law enforcement for stopping cops' punches with their face. Selective prosecution happened when prison sentences were handed down for the same charges $50 tickets were given in the past and afterwards...

• @EricLDaugh

• JUST IN: Elon Musk says Barack Hussein Obama IMPORTED Somalis and other 3rd world migrants in specific locations "in order to ensure that a Democrat would win the election in that district". Tens of THOUSANDS of Somalis came in under Obama...barely ANY came in under Trump Term 1. "The Somalis and many other groups were imported, given government handouts and allowed to do fraud without prosecution." - Import voters. - Give them endless free stuff. - Never hold them accountable. - Achieve power. IT'S CRIMINAL!

• @WallStreetApes

• Apple recently filed a patent number US20230225659A1. The new earbuds described in the patent will allow Apple to read your brain waves. “Earbuds that are designed and patented by Apple to literally read your brain waves, record your brain waves — You're not going to believe what these guys have the control to do with these. Check this out. The patent is for a bio signal sensing device using dynamic selection of electrodes. This is absolutely Apple, it is 2023 and it gets not good. (video)

• @Oilfield_Rando

• Hey guys, all those insane “refugee assistance” grants I’m always tweeting? The @GOP is about to supercharge the funds. (pic)

• @RWMaloneMD

• EAT ZE BUGS? NOPE! Another blow against the plans of the globalist elites. This time, despite the millions invested, the largest insect farm in Europe, Ÿnsect, has declared itself insolvent and has gone into judicial liquidation! Will they now release billions of insects? So sad. Condolences to the WEF.

• @TheTechInvest

• $GOOGL MUST DOUBLE AI COMPUTE EVERY 6 MONTHS TO MEET DEMAND, AI INFRASTRUCTURE BOSS TELLS EMPLOYEES. The current bearish sentiment is not what’s happening fundamentally.

• @cfromhertz

• $FTAI FTAI Aviation Gains on Engine Conversion Plan for Data Centers (Bloomberg) -- FTAI Aviation shares rose more than 10% on Tuesday after the company started a program to convert CFM56 engines to power new turbines built to provide energy for data centers. Production is expected to begin in 2026. (graph)

• @KariLake

• Tim Walz was almost Vice President, one of the most vetted roles in the nation. Yet during the 2024 election, the press didn’t find the massive fraud exploding on his watch as Minnesota governor. Even after citizen journalist @nickshirleyy dropped his bombshell video, the mainstream media stayed radio silent. They’re as complicit as the fraudsters themselves. In one afternoon, Nick didn’t just highlight hundreds of millions in fraud. He destroyed the mainstream media’s credibility. (video)
• What happened in Minnesota is not merely criminal, it’s treasonous. And I have so much anger seeing this, seeing the corruption where I’m working in Washington, DC, and knowing no one's been held accountable yet. They steal our elections, pilfer our money, they dragged @RogerJStoneJr out of bed & into jail, raided Mar-A-Lago, they tried to put @POTUS behind bars. When are we gonna see some effing handcuffs on some effing criminals in this country? (video)

• @kevinvdahlgren

• Every evening in Seattle, hundreds of people gather in front of a Walgreens to sell items they’ve just shoplifted. By 8:00 p.m. the store closes. By 8:05, an open-air black market forms—rows of stolen goods laid out for buyers looking for cheap prices. Shoplifting has become big business in Seattle. Theft under $750 is treated as a misdemeanor, and in practice, most officers do not pursue or arrest offenders. The result is predictable: organized retail theft operating openly, night after night. (video)

• @Savsays

• I’m at “burn it all down” levels of angry at the government for the fraud they’ve perpetuated against the American people. Because no, this wasn’t just the work of Somalis, it was the work of our own government who has actively worked to destroy our own country for DECADES.

• @WallStreetMav

• The mayor of an American city waving the flag of a foreign country on American soil in order to remain politically viable. (video) 

• @RealAlexJones

• EXCLUSIVE: Alex Jones Reveals Trump's Fatal Blind Spots. •AG Pam Bondi Is Not A Warrior. •Kash Patel Is A Wannabe Hollywood Star. •Dan Bongino Is A Day Late & A Dollar Short. •Todd Blanche Is On Record Sabotaging EVERYTHING. •There Are Yes Men Surrounding Him In DC. •The Democrats Are Going To Indict Him & His Entire Family If He Doesn't. Prosecute Deep State Criminals! The President's Legacy Will Be One Of Ashes If He Doesn't Take Action To Address These Major Problems In His Administration! (video)

• @lDeAngelisCorey

• The Governor of Washington really just posted this. (pic)

• @C_3C_3 

• About a month ago… Politicians in DC were telling Americans we would have to move the retirement age to 70 because Social Security was going bankrupt. Think about that. That is why EVERYONE involved in taxpayer fraud needs to be punished. No exceptions. No mercy.
• The biggest news story in the world… These “news” outlets still have not covered Nick Shirley and his Somalia fraud bombshell on the biggest Media platform on the planet.. WaPo. NBC News. MSNBC. CBS News. NYT. CNN. PBS. NPR. ABC News. The Legacy Media is the enemy of the people.

Night Trading 

• Asian equity indices are -.5% to +.25% on average. 
• Asia Ex-Japan Investment Grade CDS Index 64.5 -.25 basis point.
• China Sovereign CDS 43.5 +.25 basis point.
• China Iron Ore Spot 105.9 USD/Metric Tonne +.2%. 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.81 -.2%.
• Bloomberg Emerging Markets Currency Index 36.12 -.05%.
• Bloomberg Global Risk-On/Risk Off Index 97.9 -.2%.
• US 10-Year Yield 4.12% +1.0 basis point.
• Japan 30-Year Yield 3.40% -3.0 basis points. 
• Volatility Index(VIX) futures 16.5 +.5%.
• Euro Stoxx 50 futures n/a. 
• S&P 500 futures -.09%.
• NASDAQ 100 futures -.18%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly lower, weighed down by financial and industrial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed.  The Portfolio is 75% net long heading into the day.

Stocks Slightly Lower into Final Hour on Higher Long-Term Rates, Geopolitical Tensions, Year-End Positioning, Biotech/Alt Energy Sector Weakness

Economic/Market Gauges:

• North American Investment Grade CDS Index 50.0 -.9%
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .26 +2.0 basis points
• BofA Global Financial Stress Indicator -.29 +1.0 basis point
• European Financial Sector CDS Index 54.3 -.6%
• Emerging Market CDS Index 125.0 unch.
• Bloomberg Global Trade Policy Uncertainty Index 2.3 +.4

• Citi US Economic Surprise Index 8.3 +1.0 point

• Citi Eurozone Economic Surprise Index 32.5 unch.

• Citi Emerging Markets Economic Surprise Index 29.1 -3.3 points 
• S&P 500 Current Quarter EPS Growth Rate YoY(16 of 500 reporting) +32.8% unch.
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 310.26 +.10:  Growth Rate +15.2% unch., P/E 22.2 unch.
• S&P 500 Current Year Estimated Profit Margin 13.50% -2.0 basis points
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) +n/a +n/a
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 484.46 +.20: Growth Rate +17.9% unch., P/E 32.9 unch.
• Bloomberg US Financial Conditions Index .77 -4.0 basis points
• US Yield Curve 67.25 basis points (2s/10s) +2.25 basis points 
• Bloomberg Industrial Metal Index 164.6 +2.9% 
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 28.8% +.1 percentage point
• US Atlanta Fed GDPNow Q4 Forecast +3.0% unch. 
• US 10-Year T-Note Yield 4.13% +2.0 basis points
• 1-Year TIPS Spread 2.33 unch.

• Highest target rate probability for March 18th FOMC meeting: 48.0% (+.6 percentage point) chance of 3.5%-3.75%. Highest target rate probability for April 29th meeting: 46.0%(+.1 percentage point) chance of 3.25%-3.5%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -115 open in Japan 
• China A50 Futures: Indicating -46 open in China

• DAX Futures: Indicating +180 open in Germany

Portfolio:

• Slightly Higher: On gains in my utility/tech sector longs and index hedges
• Disclosed Trades: None
• Market Exposure: 75% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Growth -.4%

Sector Underperformers:

• 1) Biotech -.9% 2) Computer Services -.7% 3) Defense -.4%

Stocks Falling on Unusual Volume: 

• OCFC, FFIC, GLSI and CORT

Stocks With Unusual Put Option Activity:

• 1) ARCC 2) IEP 3) SLS 4) IBRX 5) CCIR

Stocks With Most Negative News Mentions:

• 1) RZLT 2) JYD 3) CDE 4) CPNG 5) KLAR

Sector ETFs With Most Negative Money Flow:

• 1) XLF 2) XBI 3) XLK 4) IBB 5) XRT

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Growth unch.

Sector Outperformers:

• 1) Gold & Silver +1.6% 2) Telecom +1.3% 3) Energy +.9%

Stocks Rising on Unusual Volume:

•  AFJK, AXTI, RARE, FTAI, ASTS, EH, SBSW, BIDU, XPEV, LUNR, HYMC, SDRL, ZETA and PSNY

Stocks With Unusual Call Option Activity:

• 1) AGNC 2) OSG 3) FEZ 4) UAMY 5) UAA 

Stocks With Most Positive News Mentions:

• 1) FTAI 2) FONR 3) ONTF 4) UAA 5) ACHV

Sector ETFs With Most Positive Money Flow:

• 1) SMH 2) PPH 3) PICK 4) PRN 5) SLVP

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open:

• None of note

After the Close: 

• None of note

Economic Release 

8:30 am EST

• Initial Jobless Claims for last week is estimated to rise to 219K versus 214K the prior week.
• Continuing Claims is estimated to fall to 1905K versus 1923K prior. 

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -333,330 barrels versus a +405,000 barrel gain the prior week. Gasoline supplies is estimated to rise by +1,166,670 barrels versus a +2,862,000 barrel gain the prior week. Distillate inventories is estimated to rise by +2,000,000 barrels versus a +202,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.6% versus a -.2% decline prior. 

Upcoming Splits

• None of note

Other Potential Market Movers

• The weekly MBA Mortgage Applications report, weekly CFTC speculative net positioning reports, weekly US Baker Hughes rig count and the weekly EIA natural gas inventory report could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -42.1% Below 100-Day Average 
• Nasdaq/NYSE Volume Ratio 17.6 +3.7
• 6 Sectors Declining, 5 Sectors Rising
• 50.9% of Issues Advancing, 46.6% Declining 
• TRIN/Arms .64 -28.9%
• Non-Block Money Flow -$76.7M
  
• 38 New 52-Week Highs, 20 New Lows
• 62.2% (+.1%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 61.6 +.5

Polymarket:

• Supreme Court Rules in Favor of Trump's Tariffs? 31.0% unch.
• Will there be another US government shutdown by January 31st? 26.0% +1.0 percentage point
• Will China invade Taiwan by end of 2026? 13.0% unch.
• US-Venezuela military engagement by Jan. 31st 24.0% -16.0 percentage points

Other:

• Bloomberg Global Risk-On/Risk-Off Index 98.0 +.1%
• US High-Yield Tech Sector OAS Index 428.25 -1.0 basis point
• Bloomberg Cyclicals/Defensives Index 265.6 +.01%
• Morgan Stanley Growth vs Value Index 160.1 -.2%
• CNN Fear & Greed Index 50.0 (NEUTRAL) +3.0
• 1-Day Vix 7.5 -15.0%
  
• Vix 14.2 +.1%
  
• Total Put/Call .78 -10.3%

Tuesday Watch

Around X:

• @Business  

• President Donald Trump downplayed China’s latest maneuvers around the island of Taiwan, casting them as a continuation of longstanding military exercises. 
• China has kept its central bank on the sidelines of managing an economy hampered by weak demand and deep-seated imbalances, defying Wall Street forecasts for the biggest interest-rate cuts in a decade.
• President Trump expressed concern that Iran is moving to rebuild its nuclear capabilities after strikes by the US and Israel this year, and threatened to target the country again to prevent Tehran from stockpiling weapons.
• The Year Ahead in AI: Ads, IPOs and Moving Beyond LLMs.
• Get up to speed on what's moving global markets.
• Here's what you need to know to start your day.  

• @ZeroHedge

• China's CNOOC Discovers Massive Oilfield in Bohai Sea.
• According to Polymarket Walz isn't going anywhere.
• Regenerative Agriculture Finally Has A Seat At The Table At USDA.
• Fraud. Song: M1LLIONZ - LAGGA. (video)   
• *CNN: CIA STRUCK PORT FACILITY ON VENEZUELAN COAST. *CNN: CIA DRONE STRIKE OCCURRED EARLIER THIS MONTH. *CNN: STRIKE TARGETED DOCK BELIEVED TO BE USED BY TREN DE ARAGUA.
• Another example of staggering fraud in California: Fully one-third of community college applications are fake. They're just used for financial aid fraud. (video)
• "Quality Learing Center" First Domino To Fall As Somali-Linked Minneapolis Daycare Scandal Shocks Nation.
• Stunning - it appears they have taken down the license look-up website so Minnesotans can’t see who the Medicaid service providers are or what licensing violations they may have. @Tim_Walz @ DHS should restore this immediately.  
• The Pence Mirage: Why The Right Isn't Leaving Trump.
• Top Senate Races To Watch In 2026.
• Month-end pension rebal: "Heading into month and quarter-end, the desk's model estimates $13 billion of US equities to sell from US pensions given the moves in equities and bonds" - Goldman.
• In a group chat with a bunch of smart, successful liberals who still don't understand how elections get stolen. So I wanted to share. In simple terms, this is what happens: 1) Fill up the voter rolls with as many names as possible, including illegals, dead people, and residents who left the state. 2) Legislate for unsolicited ballots to be automatically mailed out. 3) Pay people (per ballot) to collect, fill out, sign, and send back or dump these ballots into drop boxes. Here's how this works:
• Precious Metals Puke, Bonds Bid As Stocks Give Up Santa's Gains. 

• @CNBC

• Tuesday's big stock stories: What’s likely to move the market in the next trading session.
• Asia-Pacific markets set to open mostly lower on penultimate day of the year.
• 'Still bullish on cybersecurity,' says Evercore's Peter Levine.
• 'We're in the middle of a big buildout of infrastructure around data centers,' says
  @SPGlobalRatings' Global Chief Economist Paul Gruenwald on AI data center boom and demand.
• 'AI trade isn't a bubble,' says @barbara_doran1, adding 'the Mag 7 should continue to compound nicely in 2026'.
• Stock futures are little changed after S&P 500 posts back-to-back losses: Live updates.

• @MarioNawful 

• MEET JODI HARPSTEAD: RAN MINNESOTA'S DAYCARE OVERSIGHT 2019-2024 - "THEY KNEW" ABOUT THE FRAUD. While Nick Shirley was finding $110 million in fraud in one day, one name keeps coming up: Jodi Harpstead. She ran the Minnesota Department of Human Services agency overseeing daycares from 2019-2024. The agency that licensed these facilities. Processed payments. Documented violations. And kept paying anyway. Video surfaced of Harpstead at a hearing:
• $18 BILLION GONE: MINNESOTA SOCIAL PROGRAMS LOOTED AT “INDUSTRIAL SCALE”. 6 more people have been charged in what’s turning into one of the most outrageous public fund heists in the U.S. “Not a handful of bad actors… industrial scale fraud,” said Joe Thompson, First Assistant U.S Attorney. Minnesota flagged 14 programs as “high risk,” costing taxpayers $18 billion since 2018. Feds say half or more of that may have gone straight into scammers’ pockets. (video)

• @ElonMusk

• It’s not just daycares… Somalis in Minnesota have been setting up fake medical centers and fraudulently diagnosing their children with autism to systematically steal billions of taxpayer dollars through Medicaid. Medicaid autism claims: 2018 - $3 million. 2023 - $399 million.
• Let me get this straight.. 1. Somali immigrants get billions in taxpayer dollars for *free* for fraudulent daycares. 2. in exchange, they fund democratic candidates with the free money. 3. democratic politicians (Walz, Omar, etc) ensure fraudulent payments continue. That is exactly what’s happening.

• @GenFlynn

• BREAKING: We The People demand ACCOUNTABILITY! Dear Mr. @POTUS, I know you are listening to We the People. This message is sent on behalf of a very frustrated 79 million Americans who voted for you and millions more who refuse to be ignored. Therefore, we are designating 2026 as THE YEAR OF ACCOUNTABILITY! Why now? Because the country is at a breaking point. Our freedoms are being chipped away in plain sight. Our government has grown bloated, arrogant, and unaccountable. Public trust has not merely declined; it has been obliterated. Power has been stripped from citizens and hoarded by bureaucrats, agencies, and unelected elites. Those who call themselves leaders protect each other while the American people pay the price. Civic duty has vanished from classrooms, replaced by obedience and ideology. The family, once the backbone of this nation, has been systematically weakened and devalued. Enough is Enough! At its core, this is not partisan. All Americans are demanding ACCOUNTABILITY. We the People reject the lies, the gaslighting, the censorship, and the deliberate erosion of our lived reality over the past decade. We remember what was done. We know who did it. We are no longer willing to move on without consequences. The message is unmistakable and unstoppable. Americans demand ACCOUNTABILITY. So Mr. @POTUS, the question for you to answer is simple. Will you stand with We The People or will you protect the system that failed us? Make 2026 the year of ACCOUNTABILITY. We will stand with you through thick and thin like we always have, but you must respect our wishes. If you don’t, as our founders warned, the deep state concentration of power in government will lead to greater corruption and eventual tyranny. And your legacy in history will be tarnished beyond repair. Respectfully, 1 of the 79 million voters.
• Breaking: Massive crimes against U.S. taxpayers! @MikeBenzCyber I find your reporting exceptional and fact based but why hasn’t anyone from USAID been indicted or at least subpoenaed for these many alleged crimes committed? @AGPamBondi this is a question for you? Why is the @CIA and its director @CIADirector not speaking out about any of this? You state the CIA is responsible for the outcomes of many national elections.

• @RenzTom

• Why is MAGA complaining about Pam Bondi? After nearly a year as Attorney General (sworn in early 2025), Bondi has failed epically to deliver on MAGA's key issue: accountability. She has delivered zero high-profile prosecutions—no major indictments, no perp walks—and statutes of limitations are ticking down on cases like J6 committee crimes (some expiring Jan. 6, 2026). We post and share to urge Trump to fire Bondi and hire someone capable of fulfilling campaign promises:

• @bennyjohnson

• Now that we're all aware that medical fraud is a multi-billion dollar industry in Minnesota, can we get some answers about Rep. Melissa Hortman's murder? Melissa Hortman is the only Democrat to vote against healthcare for illegals. She killed the bill. Hortman and her husband were murdered soon after this vote. (video) 

• @TheSCIF

• DOMINION Voting System's own VP EXPOSING their wireless capabilities and testimonies of the types of FRAUD that occurred in the 2020 Election. The glitch is the STEAL as election officials testify about Trump votes automatically turning into Biden votes through programming and remote access. The VP clarifies that Dominion's machines are 3G and 4G capable and data from the ICP can be sent via cellular modems. (video)

• @BrianEastwood_X

• With everything going on in Minnesota, it is all starting to make sense now: why two state lawmakers were targeted by an assassin. State Rep. Melissa Hortman (D) and her husband were killed. State Sen. John Hoffman (D) and his wife were shot but survived. The legislature in June passed a bill ending state-funded health coverage (MinnesotaCare) for undocumented adults. These two lawmakers were the only Democrats to vote with Republicans. If you ask me, Tim Walz, the assassin, these lawmakers, and all the Somali fraud, it’s all connected!

• @KariLake

• Traitor Tim Waltz must be tossed out of the Minnesota governor’s mansion immediately and prosecuted for crimes against the people of America. Remember, these weren’t just state tax dollars that were being fraudulently misused, these were federal tax dollars. Every single American taxpayer is a victim of Tim Walz’s corruption. (video)

• @mattbanswol

• Remember when the GOP gave Elon Musk and DOGE a standing ovation in front of the entire American people... ...and then only voted on one DOGE cut, never held anyone accountable, and spent the rest of the year posting about it? This performative bullshit has to stop. (video)

• @EricLDaugh

• JUST IN: Shocking footage is resurfacing catching Somalis dropping their kids off at a "DAYCARE" for a few seconds. Just to LEAVE with the child, letting the center take money from the taxpayer for a FULL DAY of care. The parents got kickbacks. UNREAL. (video)
• HOLY SMOKES. The man who was in Nick Shirley’s video has gone to 50 Somali “day cares” on his own and NOT ONE has children. “They average about $2.5 million a year!” “I go there in the morning, afternoon and night — no kids there EVER.” RAID THEM ALL! (video)
• THIS MINNESOTA JUDGE, Sarah West, threw out a $7 MILLION dollar unanimous Somali fraud conviction. The jury was unanimous. Somali man Abdifatah Yusuf got off totally free after he stole millions in Medicaid dollars. Absolutely infuriating. Not only do Minnesota Democrats ignore and allow the fraud to happen - but once it's PROVEN, they throw the case out.

• @WallStreetApes

• WOW!! MSNBC is broadcasting to all of America that the Somalian fraud in Minnesota is made up by Donald Trump. MSNBC is actually saying the FBI and DOJ are lying about the fraud. The mainstream media is organized crime against the United States and should be prosecuted. (video)

• @WarClandestine

• Everything revolves around the Dems cheating in elections. They want the border open so they can import illegals, and they want elections insecure so they can let the illegals vote. They don’t want ICE/US MIL in their cities, because they don’t want their illegal voters to be deported. They opposed the One Big Beautiful Bill because it funds ICE/US MIL, and they know Trump is going to invoke the Insurrection Act to deploy troops to their cities to assist ICE in deporting the illegals. If the Dems can’t cheat in elections, they lose access to our tax dollars, and thus they lose all their power.

• @WallStreetMav

• Republican Rep Tom Emmer, the 3rd most powerful member in leadership for the Congress for House Republicans ... he basically told his constituents to be quiet about all of the Somalis being brought into St Cloud Minnesota. Tom Emmer is part of the problem.

Night Trading 

• Asian equity indices are -.25% to +.25% on average. 
• Asia Ex-Japan Investment Grade CDS Index 64.75 +.25 basis point.
• China Sovereign CDS 43.25 -.5 basis point.
• China Iron Ore Spot 105.5 USD/Metric Tonne -.3%. 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.88 +.08%.
• Bloomberg Emerging Markets Currency Index 36.1 +.01%.
• Bloomberg Global Risk-On/Risk Off Index 98.3 +.4%.
• US 10-Year Yield 4.11% unch.
• Japan 30-Year Yield 3.42% -1.0 basis point. 
• Volatility Index(VIX) futures 16.8 -.%.
• Euro Stoxx 50 futures n/a. 
• S&P 500 futures -.01%.
• NASDAQ 100 futures -.04%.

Morning Preview Links

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 weaken into the afternoon, finishing modestly lower.  The Portfolio is 75% net long heading into the day.