Bull Radar

Style Outperformer:

• Large-Cap Value -1.33%

Sector Outperformers:

• 1) Homebuilders +.08% 2) Oil Service -.83% 3) Utilities -1.10%

Stocks Rising on Unusual Volume:

• GEOY, PEET, HAS, SYNC, RA, NRG and ETN
  

Stocks With Unusual Call Option Activity:

• 1) HAS 2) VRNG 3) TRIP 4) ETN 5) PZG
  

Stocks With Most Positive News Mentions:

• 1) NOC 2) SLB 3) BA 4) CCE 5) GEOY
  

Charts:

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

Monday Watch

Weekend Headlines
Bloomberg:

• Six Spanish Regions May Seek Bailout After Valencia, Pais Says. The Balearic Islands and Catalonia are among six Spanish regions that may ask for aid from the central government after Valencia sought a bailout, El Pais reported. Castilla-La-Mancha, Murcia, the Canary Islands and possibly Andalusia are also having difficulty funding themselves and some of these regions are studying plans to tap the recently created emergency-loan fund that Valencia said it would use yesterday, the newspaper said, without citing anyone.
• Catalonia May Follow Valencia in Bailout Request, El Pais Says. The regional government of Catalonia may follow Valencia to ask for financial aid from the central government, El Pais reported, citing Catalan delegate in Parliament Josep Rull. The Catalan regional government, led by Artur Mas, is trying to negotiate a 500 million euro ($608 million) bridge loan with undisclosed financial entities, El Pais said. The regional government has warned publicly funded hospitals and schools that if they fail to secure the loan they will not receive payment this month given that they only have enough cash to pay public sector employee wages, debt maturities and some supplier´s bills, El Pais added.
• Spain’s Margallo Urges ECB to Buy Country’s Bonds, FAZ Reports. Spanish Foreign Minister Jose Manuel Garcia Margallo urged the European Central Bank to buy his country’s bonds as yields widen, the Frankfurter Allgemeine Zeitung reported, citing comments made at a meeting of European Union foreign ministers yesterday in Palma de Mallorca. The ECB is “in hiding,” Garcia Margallo is cited as saying to reporters, according to FAZ. The bank’s “doing nothing to douse the fire” of Spain’s sovereign debt. Financial markets are rewarding Spain’s efforts to consolidate debt “by boxing its ears,” he said. The euro-area must “act decisively” in Spain’s interest, he added.
• IMF to Stop Further Aid Tranches to Greece, Spiegel Says. The International Monetary Fund will stop paying further rescue aid to Greece, making the country’s insolvency in September more likely, the Der Spiegel magazine said. citing unidentified European Union officials. While a review of Greece’s progress in meeting terms of its rescue is unfinished, it is “already clear” to the reviewing body of the IMF, the EU Commission and the European Central Bank that Greece will not be able to fulfill its promise to cut debt to 120 percent of annual economic growth in euro terms by 2020, Der Spiegel said. Missing the target means Greece needs between 10 billion euros and 50 billion euros ($60.8 billion) in additional aid, a potential outcome that the IMF and several unidentified euro- area states are not prepared to accept, the magazine said, citing the review.
• Germany’s Roesler Says ‘Very Skeptical’ Greece Can Be Rescued. German Vice Chancellor Philipp Roesler said he’s “very skeptical” that European leaders will be able to rescue Greece and the prospect of the country’s exit from the euro had “lost its terror.” Roesler, who is Germany’s economy minister, told broadcaster ARD that Greece was unlikely to be able to meet its obligations under a euro-area bailout program as its international creditors hold talks this week in Athens. Should that be the case, the country won’t receive more bailout payments, Roesler said. “What’s emerging is that Greece will probably not be able to fulfil its conditions,” Roesler said today in an ARD summer interview. “What is clear: if Greece doesn’t fulfil those conditions, then there can be no more payments.”
• ESM Ratification Delay Worrisome, OECD’s Padoan Tells La Stampa. Germany’s delay in ratifying the permanent European Stability Mechanism is “worrisome,” the Organization for Economic Cooperation and Development’s chief economist, Pier Carlo Padoan, told La Stampa. “We have in front of us a long period of political uncertainty” on how to tame markets, Padoan told the Italian newspaper in an interview. Italy is on the right track in terms of budget consolidation, though “the markets are wondering whether in the next 18 months the effort will continue,” he told the newspaper.
• Euro Drops to 11-Year Low Versus Yen Before Spain Auction. The euro touched the lowest level in more than 11 years against the yen as a Spanish bill sale tomorrow highlights funding pressures that have prompted five states in the trading bloc to seek international rescues. The 17-nation currency continued its decline against the dollar into a fourth day after Spain’s 10-year note yields climbed toward a euro-era record last week. Catalonia, Spain’s most indebted region, said it’s studying the conditions of a central government aid mechanism after the regional government of Valencia said it would tap the fund. “The foreign-exchange market is going to be watching European bond market developments extremely closely this week,” said Ray Attrill, global co-head of foreign-exchange strategy at National Australia Bank Ltd. (NAB) in Sydney. “The euro-dollar rate will continue to go down.”
• Japan Sees More ‘Widespread’ Global Slowdown With China Cooling. Japan’s government is seeing increased signs of a weakening global expansion that may weigh on an economy dependent on reconstruction demand from last year’s earthquake. “The slowdown in the global economy is becoming more widespread,” the Cabinet Office said in a monthly report released in Tokyo today. The expansion in China is “slowing a bit,” it said, lowering its evaluation of Japan’s largest trading partner for a third month while leaving its assessment of its own economy unchanged from June. Japan’s increased pessimism about global growth echoes that of the International Monetary Fund, which lowered its 2013 global growth forecasts this month amid a prolonged debt crisis in Europe and slower expansions in emerging markets from China to India. “Sharp fluctuations” in financial markets stemming from global uncertainty could hurt Japan’s growth prospects, the government said.
• Asia Stocks Fall for 2nd Day on China Slowdown. Asian stocks dropped for a second day after a Chinese central bank adviser forecast an economic slowdown and on renewed concern that Greece may not meet its bailout targets, damping demand for riskier assets. Machinery maker Komatsu Ltd. (6301), which generates 24 percent of its revenue in China and Europe, dropped 2.2 percent in Tokyo. BHP Billiton Ltd. (BHP), the world’s largest mining company, lost 2.8 percent in Sydney as lower oil and metal prices weighed on growth-sensitive companies. JFE Holdings Inc. fell 2.3 percent in Tokyo, pacing declines among steel companies on a report its quarterly profit fell. The MSCI Asia Pacific Index lost 1.1 percent to 115.41 as of 10:09 a.m. in Tokyo before markets in Hong Kong and China opened. Almost eight stocks dropped for each that gained on the measure
• Netanyahu Says Israel Might Act to Stop Syria Weapons Transfer. Prime Minister Benjamin Netanyahu said Israel is concerned that terrorists could gain control of chemical weapons if Syria’s government collapses into chaos and won’t rule out taking measures to prevent such a transfer. “Do I seek action? No,” Netanyahu said in an interview on the Fox News Sunday program. “Do I preclude it? No.” Netanyahu said the need for action “might arise if there’s a regime collapse, but not a regime change.” The Syrian army’s inability to end an armed rebellion that has killed more than 17,000 civilians in the past 17 months is raising concerns about the government’s ability to protect its stockpiles of chemical weapons.
• Iraq Oil Pipelines to Turkey Shut After Explosion, AP Says. An explosion and fire shut two pipelines that transport oil from Kirkuk in northern Iraq to the Turkish port of Ceyhan, the Associated Press reported, citing an unnamed official from the Turkish energy ministry. The blast, which happened late yesterday, damaged a section of one of the pipelines, AP cited the official as saying. The second pipeline runs parallel and was shut down as a precautionary measure, according to the report. Firefighters were still trying to extinguish the blaze, the official said.
• Corn-Crop Damage From Drought Poised to Worsen: Chart of the Day. Corn is due for more damage from a drought that has produced the worst U.S. growing conditions in almost a quarter century, according to David Driscoll, a Citigroup Inc. analyst. The CHART OF THE DAY displays the percentage of the corn crop in good to excellent condition, according to data compiled by the Agriculture Department. Average readings for the previous 25 years and data for 1988, another drought year, are included for comparison.
• Sales Slowdown Masked by Better-Than-Expected Earnings. Better-than-forecast earnings are masking weaker sales growth in the most recent quarter as U.S. companies including International Business Machines Corp. (IBM) improve margins to top estimates. Sales rose an average 2.9 percent in the second quarter among 119 members of the Standard & Poor’s 500 Index that have reported results so far, the weakest since a decline of 9.6 percent in the third quarter of 2009, according to data compiled by Bloomberg. Only 42 percent of the reported companies have topped analysts’ estimates on sales, while 73 percent have beaten on profit, the data show. The gap in results signals companies may hold off hiring and expanding until demand rebounds globally.
• N. Korea Says It’s Reviewing ‘Nuclear Issue’ to Counter U.S. North Korea said it is reviewing the “nuclear issue” to counter the U.S., days after Kim Jong Un consolidated his power by taking the nation’s top military rank and removing the army chief. The U.S. is funding plots to bring down the regime in Pyongyang, an unidentified Foreign Ministry spokesman said in a statement carried by the official Korean Central News Agency yesterday. The dispatch didn’t elaborate on what was meant by the nuclear review. Kim may be preparing to follow in the footsteps of his father, Kim Jong Il, who detonated nuclear devices in 2006 and 2009, according to South Korea’s Foreign Ministry.
• Nasdaq(NDAQ) Boosts Facebook IPO Payout to $62M. Nasdaq OMX Group Inc., the second- biggest U.S. stock exchange owner, revamped its proposal to compensate brokers that lost money in the public debut of Facebook Inc. (FB), boosting the payout to $62 million cash.
• Colorado’s Hickenlooper Says Gun Control Won’t Stop Evil. Tragedies like the “act of evil” that claimed 12 lives in a movie theater shooting in Aurora, Colorado, may not be preventable by stricter gun controls, the state’s governor said. “I’m not sure there is any way in a free society to be able” to stop a deranged individual from assembling a deadly arsenal, Governor John Hickenlooper, a Democrat, said today on CNN’s “State of the Union.”
• Aging Japan-Chinese Workers Drive Jobs to Southeast Asia. Asia’s manufacturing powerhouses -- Japan, South Korea and China -- are among the fastest-aging countries in the world, while developing nations in Southeast Asia are among the youngest in the region. As factories, jobs and investment flow south to tap cheaper labor, growth in the 10-member Association of Southeast Asian Nations is poised to accelerate, propelling the area’s currencies and fueling consumer and property booms, Bank of America Corp. says. “The demographic dividend is over for Japan and Korea, and it will be over for China soon,” said Yoshimasa Maruyama, chief economist at Itochu Corp., Japan’s third-largest trading company. “It’s happening now in the Asean area, and it will continue for some time.”
• Bulls Ascendant as Wagers Climb to Three-Month High: Commodities. Speculators raised bullish wagers on commodities to a three-month high on mounting speculation that more stimulus measures will boost demand for everything from oil to metals and crop prices will keep rising as drought spreads. Money managers raised their net-long positions across 18 U.S. futures and options by 7.5 percent to 1.13 million contracts in the week ended July 17, U.S. Commodity Futures Trading Commission data show. Wheat holdings reached a record, and corn bets climbed to the highest since March.

Wall Street Journal:

• Services, Vigil Remember Victims. Thousands gathered at sunset Sunday on the lawn of this city's Municipal Building to remember those killed in a movie-theater shooting Friday, with the crowd cheering the actions of survivors who helped others in the chaos and reserving its loudest applause for the state's governor who said he would not say the suspect's name.
• Colorado Shooting: Latest Updates.
• Syrian Conflict Draws In Christians. Clashes Engulf Damascus and Aleppo, Forcing Minority's Members to Take Sides; Revenge Killings Offer Cautionary Tale. Syria's conflict, increasingly characterized as a Muslim sectarian war, is now also threatening to engulf the country's estimated 2 million Christians. As clashes between government forces and rebels spread over the weekend from the capital Damascus to the northern city of Aleppo—Syria's two largest urban centers that are home to sizable Christian communities—the Christians and other minorities are being forced to take sides. Several Christian residents and antiregime activists in Damascus say the regime is now arming male loyalists in parts of the capital dominated by Christians and Druze and Shiite minorities.
• Land Rush at National Parks. Federal land managers are stepping up efforts to acquire privately owned acres that lie within national parks, even as funding to do so has been slashed. The urgency, officials say, comes because of owners like 66-year-old Bob Lundgren, who inherited his father's historic rights to a 120-acre patch of forest inside Glacier National Park's southern boundary, along the Middle Fork of the Flathead River.
• Ari Fleischer: The Latest News on Tax Fairness. A new Congressional Budget Office reports shows the share of taxes paid by the top 20% has gone up over the last 30 years, while the share of taxes paid by everyone else has gone down.
• Tough Times for Colleges—and College Towns. The finances of many of the nation's institutions of higher education are starting to wobble. If they continue to deteriorate, the fallout won't be confined to college campuses. Decades of heavy spending by colleges and universities has left many of them with high debt. That profligacy, along with declining state aid and weak returns on endowments, has the balance sheets of one-third of U.S. schools looking significantly weaker than they did before the recession, according to a new report that surveyed 1,692 private and public schools from consulting company Bain & Co. and Sterling Partners, a private-equity firm.
• Deadly Flooding in Beijing Sparks Anger. Flooding that killed more than three dozen people in Beijing this weekend sparked anger and questions over how a city lauded for its new infrastructure and rapid modernization could suffer so tragically.
• Israel Says Intelligence Ties Hezbollah to Bulgaria Attack. Israeli Prime Minister Benjamin Netanyahu said Sunday that his government has gathered "unquestionable" intelligence showing that the Lebanese militant group Hezbollah, backed by Iran, was behind a suicide bombing in Bulgaria last week that killed five Israeli nationals.

Business Insider:

• Nobody Trusts Facebook(FB) With Their Data.
• The Government Is Strangling The American Dream Of Upward Mobility.
• The Women Of Bloomberg TV.
• 12 American Cities That Rank Among The Biggest Economies In The World.
• US Poverty On Track To Reach Highest Level Since The 1960s.
• Consumer Spending Is Becoming A Big Red Flag.
• Spain Nears Implosion As Businesses Threaten To Leave.

Zero Hedge:

• Lieborgate: Here Come The Arrests.
• Greece's Tsipras Calls For 'Drachmatization' Instead Of TROIKA "Longer Rope To Hang Ourselves".
• Spain's Banking Reform Is A Bailout Of The Status Quo.
• The Eminent Domain Mortgage Heist.
• Forget Corn, Is Soy Poised For Lift-Off?

CNBC:

• Lying Libor Is Nothing Compared to China’s Fake GDP: Report. A fake Libor rate, the scandal involving global benchmark interest rates that has raised the level of distrust in major banks and markets, is nothing compared to the damage that could be done if China’s true economic growth figures were revealed, according to Larry McDonald’s newsletter.

Wall Street All-Stars:

• Indicator Update: How Big is the Economic Slowdown?

IBD:

• Loyal Customers Drive Growth At Off-Price Retailer TJX(TJX).

NY Post:

• Obama’s house of cards. Bubble? What bubble!? By pushing bad loans in the name of ‘diversity,’ the president is creating the mortgage crisis all over again. With studies showing home foreclosures hitting blacks and Latinos hardest, the Obama administration’s answer is baffling as well as destructive — to lend them more money, repeating the cycle of easy credit that led to the housing boom and bust.
  

Gallop:

• Faith in Spanish Banks in Free Fall. (graph)
  

Rasmussen Reports:

• Among Military Veterans: Romney 59% Obama 35%.
  

Financial Times:

• Tesco scales down ambitions for China. “You’ll find more people in Chernobyl on a winter’s day,” is how one Tesco manager sums up the lacklustre business at one of the company’s Chinese shopping malls. The mall in question, in Qingdao, a large port city, was supposed to be one of the focal points of Tesco’s vast effort to crack the Chinese market. Instead, it has become a symbol of the company’s difficulties in the world’s second-biggest economy.

The Telegraph:

• Blaming the Spanish victim as Europe spirals into summer crisis. It is time for Spain and the victim states to seize the initiative. The financial credibility of Spain is close to zero. Fiscal credibility is zero. Political credibility is zero. The new government of Mariano Rajoy has squandered the advantages of its absolute majority in a matter of months, and completely lost the confidence of Europe's institutions. That is the verdict of unnamed EU officials and sources in Brussels cited by El Pais, following the twin crash of the Madrid bourse and the Spanish bond market on `Black Friday'. The claims are self-serving spin by Europe’s incompetent policy elite. Once again, they are blaming the victim for the consequences of their own scorched-earth monetary, fiscal, and regulatory policies. The reason why Spain is spiralling into deeper depression is because EMU policy settings are contractionary.
• Euro exit and depreciation would bring economic gains. In an exclusive extract from his updated book, Roger Bootle explains why allowing a country such as Greece to leave the euro is not as hard as critics think.
• Greek economy is in a 'Great Depression' says Samaras. Greece is in a "Great Depression" similar to the American one in the 1930s, the country's Prime Minister Antonis Samaras told former US President Bill Clinton on Sunday.

Hamburger Abendblatt:

• German FDP Rules Out Crossing 'Rubicon' on Greek Aid. Germany's Free Democrats, partners to Chancellor Angela Merkel's Christian Democrats in the ruling coalition, ruled out backing any attempt by Greece to ease the terms of its bailout aid. "That won't work - that's a Rubicon we can't cross," Guido Westerwelle, the FDP Foreign Minister said in an interview. "It's in Greece's own hands to ensure it stays" in the euro, he is cited as saying.
  

Die Welt:

• EU 'Dwarves' Must Plan Greek Euro Exit, Merkel Ally Says. European Union President Herman Van Rompuy and EU Commission President Jose Barroso are "political dwarves" who should stop promoting European integration as the panacea for debt crisis ills and instead draw up a concept for a smaller euro-area, the General Secretary of Germany's Christian Social Union party said. Alexander Dobrindt, whose CSU party is one of three making up Germany's ruling coalition, told the paper that Barroso and Van Rompuy should draw up a "road map" for Greece to leave the single currency. Referring to Barroso and Van Rompuy, he said "putting political dwarves on a ladder won't make them into giants."
  

Deutsche-Presse Agentur:

• German Finance Minister Wolfgang Schaeuble urged his Christian Democratic Union party to uphold its record of solid support for government policy in the debt crisis, saying his country has "most to lose" if the euro fails. CDU lawmakers who rejected the government's Spanish aid bill in parliament on July 19 should prevent inner-party dissent from growing to the point of causing the government to collapse, Schaeuble said today at a party congress in the city of Karlsruhe. "We can't let the impression arise that the CDU is no longer able to find a united position on key policy," Schaeuble is cited as saying.
  

WirtschaftsWoche:

• Samaras Coalition May Soon Collapse, Papaconstantinou Says. The Greek government led by Prime Minister Antonis Samaras may soon collapse amid conflict caused by his New Democracy party's domination of the coalition, according to comments made by former finance minister George Papaconstantinou said. Samaras has overstaffed the Cabinet with New Democracy ministers "who weren't exactly a success" in the last regime, Papaconstantinou is cited as saying. The Socialist Pasok party and the so-called Democratic Left Dimar party are underrepresented in the coalition, he said, adding he is "not optimistic" the alliance can survive.
  

Il Sole 24 Ore:

• Italian Government to Seek Vote on Spending Cuts. Italian Prime Minister Mario Monti's government plans to call a confidence vote on a package of spending cuts to fore parliament to pass it by Aug. 2.

The Asahi Shimbun:

• TEPCO Subcontractor Used Lead to Fake Dosimeter Readings at Fukushima Plant. Workers at the crippled Fukushima No. 1 nuclear plant were ordered to cover their dosimeters with lead plates to keep radiation doses low enough to continue working under dangerous conditions, the Asahi Shimbun has learned. Some refused the orders. Others raised questions about their safety and the legality of the practice. But the man in charge, a senior official of a subcontractor of Tokyo Electric Power Co., warned them that they would lose their jobs--and any chance of employment at other nuclear plants--if they failed to comply.

Nikkei:

• Japan's largest steelmaker will probably report first-quarter current profit fell by 80% from a year earlier. Increased production by Chinese makers has reduced steel prices in Asian markets, the newspaper said. Pretax profit at JFE Holdings Inc., the nation's second-biggest steelmaker, may have declined 60% in 1Q.
  

Financial News:

• China to Channel Fiscal Spending to Subsidized Housing. China will channel the government's fiscal investments into supporting construction of social homes, irrigation for agriculture and development of strategic industries, citing Bai Jingming, deputy director of the finance ministry's research institute. China will focus on avoiding redundant infrastructure construction and increase the investments for public goods, Bai said.
  

China Daily:

• China Should Remain Firm on Property Curbs. China should remain firm on property curbs as a rebound in real estate prices would mean discounting of the government's credibility, according to a People Daily's commentary written by Tian Shan.

China Business News:

• China May Raise Fuel Prices in Early August. Gasoline and diesel prices may be increased by 350-400 yuan per ton on August 8, citing Hu Huichun, an analyst at researcher Chem99.com.

Economic Observer:

• Shenzhen Empty Factory Space Increases on Slow Economy. Factory vacancy rates increased in the southern Chinese city of Shenzhen because of a slowing economy, citing agents. Overall factory vacancy rate on the outskirts of Shenzhen rose by 5% recently from the end of 2011, citing Zhu Jianguo, an industry property agency manager. The current situation is worse than the time of the financial crisis in 2008, citing Huang Shaowu, a factory property agent manager. Factory vacancy rates averaged at 30%-45% in early 2009, according to the report.

Weekend Recommendations

Barron's:

• Made positive comments on (JBT), (KMT) and (CPN).
• Made negative comments on (MFRM).
  

Night Trading

• Asian indices are -2.25% to -1.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 170.0 +9.0 basis points.
• Asia Pacific Sovereign CDS Index 133.0 -.25 basis point.
• FTSE-100 futures -.81%.
  
• S&P 500 futures -.56%.
• NASDAQ 100 futures -.44%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (HAL)/.75
• (ETN)/1.08
• (HAS)/.24
• (MCD)/1.37
• (TXN)/.34
• (VMW)/.66
• (STLD)/.20

Economic Releases
8:30 am EST

• The Chicago Fed Nat Activity Index for June.

Upcoming Splits

• (CME) 5-for-1
  

Other Potential Market Movers

• The Fed's Raskin speaking and the China HSBC Flash PMI could also impact trading today.
  

BOTTOM LINE: Asian indices are lower, weighed down by technology and financial shares in the region. I expect US stocks to open modestly lower and to maintain losses into the afternoon. The Portfolio is 25% net long heading into the week.

Weekly Outlook

U.S. Week Ahead by MarketWatch (video).
Wall St. Week Ahead by Reuters.
Stocks to Watch Monday by MarketWatch.
Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week modestly lower on Rising Eurozone debt angst, rising global growth fears, more shorting, profit taking, US "fiscal cliff" concerns, rising food/energy prices and earnings worries. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 25% net long heading into the week.

Market Week in Review

S&P 500 1,362.66 +.43%*



The Weekly Wrap by Briefing.com.

*5-Day Change

Weekly Scoreboard*

Indices

• S&P 500 1,362.66 +.43%
  
• DJIA 12,822.50 +.36%
  
• NASDAQ 2,925.30 +.58%
  
• Russell 2000 791.54 -1.18%
  
• Value Line Geometric(broad market) 340.83 -.67%
  
• Russell 1000 Growth 636.34 +.68%
  
• Russell 1000 Value 669.28 +.05%
  
• Morgan Stanley Consumer 800.79 +.56%
  
• Morgan Stanley Cyclical 901.37 +.27%
• Morgan Stanley Technology 635.47 +2.45%
  
• Transports 5,072.20 -2.30%
  
• Utilities 489.34 +.76%
• Bloomberg European Bank/Financial Services 69.74 -2.95%
  
• MSCI Emerging Markets 38.75 +1.12%
  
• Lyxor L/S Equity Long Bias 1,021.08 +1.04%
  
• Lyxor L/S Equity Variable Bias 803.53 +.60%
  
• Lyxor L/S Equity Short Bias 539.39 +.01%
  

Sentiment/Internals

• NYSE Cumulative A/D Line 148,777 +2.5%
  
• Bloomberg New Highs-Lows Index 129 +288
  
• Bloomberg Crude Oil % Bulls 38.0 +8.6%
  
• CFTC Oil Net Speculative Position 172,779 +24.7%
  
• CFTC Oil Total Open Interest 1,403,473 -.7%
  
• Total Put/Call 1.0 unch.
  
• OEX Put/Call 1.33 +.76%
  
• ISE Sentiment 114.0 +21.28%
  
• NYSE Arms 1.59 +160.65%
  
• Volatility(VIX) 16.27 -2.81%
• S&P 500 Implied Correlation 67.40 +3.06%
  
• G7 Currency Volatility (VXY) 8.65 -5.98%
  
• Smart Money Flow Index 11,323.15 +2.0%
  
• Money Mkt Mutual Fund Assets $2.539 Trillion -.50%
  
• AAII % Bulls 22.19 -26.6%
  
• AAII % Bears 41.79 +20.3%

Futures Spot Prices

• CRB Index 304.57 +3.61%
  
• Crude Oil 91.83 +5.02%
  
• Reformulated Gasoline 294.30 +4.69%
  
• Natural Gas 3.08 +6.98%
  
• Heating Oil 292.43 +4.85%
  
• Gold 1,582.80 -.33%
  
• Bloomberg Base Metals Index 197.62 -.15%
  
• Copper 344.80 -1.25%
  
• US No. 1 Heavy Melt Scrap Steel 347.67 USD/Ton unch.
  
• China Iron Ore Spot 125.0 USD/Ton -5.87%
  
• Lumber 293.80 +.75%
  
• UBS-Bloomberg Agriculture 1,786.14 +5.23%
  

Economy

• ECRI Weekly Leading Economic Index Growth Rate -2.30% -10 basis points
  
• Philly Fed ADS Real-Time Business Conditions Index -.1292 -9.77%
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 110.47 -.27%
  
• Citi US Economic Surprise Index -64.50 -2.9 points
  
• Fed Fund Futures imply 60.0% chance of no change, 40.0% chance of 25 basis point cut on 8/1
  
• US Dollar Index 83.48 +.23%
  
• Yield Curve 125.0 unch.
  
• 10-Year US Treasury Yield 1.46% -3 basis points
  
• Federal Reserve's Balance Sheet $2.842 Trillion -.25%
  
• U.S. Sovereign Debt Credit Default Swap 47.24 -4.08%
  
• Illinois Municipal Debt Credit Default Swap 237.0 +2.29%
  
• Western Europe Sovereign Debt Credit Default Swap Index 270.48 -.97%
  
• Emerging Markets Sovereign Debt CDS Index 262.50 -4.17%
  
• Saudi Sovereign Debt Credit Default Swap 107.38 -8.87%
• Iraq Sovereign Debt Credit Default Swap 424.99 unch.
  
• China Blended Corporate Spread Index 459.0 -13 basis points
  
• 10-Year TIPS Spread 2.06% -1 basis point
  
• TED Spread 36.5 -1.0 basis point
  
• 2-Year Swap Spread 24.50 +1.5 basis points
  
• 3-Month EUR/USD Cross-Currency Basis Swap -46.75 +2.75 basis points
  
• N. America Investment Grade Credit Default Swap Index 110.92 -1.73%
  
• European Financial Sector Credit Default Swap Index 284.83 +4.28%
  
• Emerging Markets Credit Default Swap Index 262.54 1.63%
  
• CMBS Super Senior AAA 10-Year Treasury Spread 155.0 -12 basis points
  
• M1 Money Supply $2.330 Trillion +2.66%
  
• Commercial Paper Outstanding 982.50 +.1%
  
• 4-Week Moving Average of Jobless Claims 375,500 -1,000
  
• Continuing Claims Unemployment Rate 2.6% unch.
  
• Average 30-Year Mortgage Rate 3.53% -3 basis points
  
• Weekly Mortgage Applications 935.40 +16.94%
  
• Bloomberg Consumer Comfort -37.9 -.4 point
  
• Weekly Retail Sales +2.0% -20 basis points
  
• Nationwide Gas $3.45/gallon +.06/gallon
  
• U.S. Cooling Demand Next 7 Days 11.0% above normal
• Baltic Dry Index 1,053 -5.13%
  
• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 25.0 unch.
  
• Rail Freight Carloads 245,915 +20.92%
  

Best Performing Style

• Large-Cap Growth +.68%
  

Worst Performing Style

• Small-Cap Value -1.32%

Leading Sectors

• Oil Service +6.02%
  
• Internet +3.47%
• Computer Services +2.48%
• Semis +2.24%
• Agriculture +2.19%

Lagging Sectors

• Alt Energy -2.31%
• Hospitals -2.72%
  
• Steel -2.78%
• I-Banks -5.18%
• Airlines -7.0%

Weekly High-Volume Stock Gainers (13)

• ALNY, PRX, PLFE, SCSS, ALJ, GGC, AFFY, MGLN, APH, MAT, SWK, DGIT and HGSI
  

Weekly High-Volume Stock Losers (11)

• IBKR, SSNC, POOL, VVUS, DLB, KW, SFG, LXK, IRG, DTSI and ROVI
  

Weekly Charts
ETFs

• High-Volume Gainers
• High-Volume Losers

Stocks

• High-Volume Gainers
• High-Volume Losers
  

*5-Day Change

Stocks Dropping into Final Hour on Surging Eurozone Debt Angst, Domestic Terror Fears, Earnings Worries, Soaring Food Prices

Broad Market Tone:

• Advance/Decline Line: Substantially Lower
  
• Sector Performance: Most Sectors Declining
  
• Volume: Slightly Below Average
  
• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• VIX 16.65 +7.77%
  
• ISE Sentiment Index 129.0 unch.
  
• Total Put/Call 1.04 +20.93%
  
• NYSE Arms 1.55 +1.58%
  

Credit Investor Angst:

• North American Investment Grade CDS Index 111.40 +3.12%
  
• European Financial Sector CDS Index 284.80 bps +4.82%
  
• Western Europe Sovereign Debt CDS Index 269.77 +2.91%
  
• Emerging Market CDS Index 262.19 +4.3%
  
• 2-Year Swap Spread 24.5 +.75 basis point
  
• TED Spread 36.5 -1.25 basis points
  
• 3-Month EUR/USD Cross-Currency Basis Swap -46.25 -2.25 basis points
  

Economic Gauges:

• 3-Month T-Bill Yield .09% +1 basis point
  
• Yield Curve 125.0 -5 basis points
  
• China Import Iron Ore Spot $125.0/Metric Tonne -.48%
  
• Citi US Economic Surprise Index -64.50 +.8 point
  
• 10-Year TIPS Spread 2.06 -5 basis points
  

Overseas Futures:

• Nikkei Futures: Indicating -80 open in Japan
• DAX Futures: Indicating -3 open in Germany
  

Portfolio:

• Slightly Lower: On losses in my Medical, Retail, Biotech and Tech sector longs
  
• Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my (EEM) short
  
• Market Exposure: Moved to 25% Net Long

BOTTOM LINE: Today's overall market action is bearish as the S&P 500 trades near session lows on surging eurozone debt angst, tech/financial sector weakness, rising food prices, US "fiscal cliff" worries, earnings concerns, domestic terror fears and rising global growth fears. On the positive side, Utility, Oil Service and Homebuilding shares are higher on the day. Oil is down -1.2% and Lumber is gaining +3.5%. On the negative side, Alt Energy, Steel, Software, Computer, Semi, Networking, Computer Service, Bank, I-Banking, Medical, Hospital, Insurance, Construction, Restaurant, Gaming, Road & Rail and Airline shares are under meaningful pressure, falling more than -1.75%. Financial and tech shares have traded heavy throughout the day. Gold is rising +.2%, Copper is falling -2.7% and the UBS-Bloomberg Ag Spot Index is rising another +1.3%. The UBS-Bloomerg Ag Spot Index is up +29.2% in about 7 weeks. The 10Y T-Note Yld is falling another -5 bps to 1.46%. The China benchmark Iron/Ore Spot Price Index has broken down again technically, falling -16.3% since April 13th and -30.9% since Sept. 7 of last year. As well, the China Hot Rolled Steel Sheet Spot Index is also picking up downside steam. Major Asian indices were lower overnight, led down by a -1.4% decline in Japan. The Shanghai Property Stock Index fell another -1.0% and is down -6.8% in 5 days. Major European indices are sharply lower, led down by a -5.8% plunge in Spain. Spanish stocks are down -27.1% ytd as they approach their June 4th lows. As well, Italian shares are falling -4.4% and are now down -13.4% ytd. The Bloomberg European Bank/Financial Services Index is dropping -3.6% and is breaking back below its downward-sloping 50-day moving-average. Brazilian equities fell -2.0% today. The Germany sovereign cds is rising +5.4% to 78.17 bps, the France sovereign cds is gaining +2.9% to 170.56 bps, the Italian sovereign cds is gaining +4.2% to 526.18 bps and the Spain sovereign cds is up 4.3% to 604.98 bps, the Ireland sovereign cds is up +3.7% to 569.70 bps and the Russia sovereign cds is up +3.5% to 192.01 bps. Moreover, the European Investment Grade CDS Index is jumping +4.9% to 168.92 bps, the Italian/German 10Y Yld Spread is gaining +4.5% to 499.85 bps and the Spain 10Y Yld is jumping +3.7% to 7.27%. US weekly retail sales have decelerated to a sluggish rate at +2.0%, which is the slowest since the week of April 5th of last year. US Trucking Traffic continues to soften. The ASA Staffing Index just took a large weekly tumble. Moreover, the Citi US Economic Surprise Index has fallen back to late-Aug. levels. Lumber is -1.0% since its March 1st high despite improving sentiment towards homebuilders and the broad equity rally ytd. Moreover, the weekly MBA Home Purchase Applications Index has been around the same level since May 2010 despite investor perceptions of a strong spring home selling season. The Baltic Dry Index has plunged around -50.0% from its Oct. 14th high and is now down around -35.0% ytd. Shanghai Copper Inventories have risen +114.0% ytd. Oil tanker rates have plunged recently, with the benchmark Middle East-to-US voyage down to 25.0 industry-standard worldscale points, which is the lowest since Oct. 2009. The CRB Commodities Index is now down -17.3% since May 2nd of last year despite the recent surge in food prices. The Spanish 10Y Yld is breaking out to a new record high and the Italian/German 10Y Yld Spread has broken free from its recent range and is only 52.0 bps from its all-time high set on Nov. 9th of last year. This is extremely concerning given the perceived recent can-kicking. Copper and the euro currency remain in intermediate-term downtrends and trade poorly. The 10Y T-Note continues to trade too well, which remains a big red flag. There appears to be a fairly high level of complacency among US investors regarding the deteriorating macro backdrop. The European Investment Grade CDS Index, European Financial Sector CDS Index, Spain sovereign cds and Italian cds, among others, have given back little of their April/May gains and appear to be in the initial stages of another push higher. The Citi Eurozone Economic Surprise Index is at -64.0 points, which is near the lowest since mid-Sept. of last year. Massive tax hikes and spending cuts are still yet to hit in several key eurozone countries that are already in recession. A lack of competitiveness remains unaddressed. The European debt crisis is also really beginning to bite emerging market economies now, which will further pressure exports from the region and further raise the odds of more sovereign/bank downgrades. The odds for QE3 are likely meaningfully lower than investors currently perceive as food prices soar and energy prices rebound. If the Fed embarks on another misguided round of QE, the Ag Spot Index should push through its Aug. 31, 2011 all-time high. This would likely also lead to another surge in energy prices as it would spur another bout of rioting in the Middle-East and other emerging markets. As well, it would greatly curtail any emerging markets stimulus plans, in my opinion. It is unlikely the Fed would take this risk ahead of an election, in my opinion. Uncertainty surrounding the effects on business of Obamacare, the "US fiscal cliff " and the election outcome uncertainty will likely become more and more of a focus for investors as the year progresses. Three of the main reasons US stocks had been rallying were the beliefs that QE3 was imminent, China would embark on another massive easing campaign and Europe had successfully kicked the can once again. However, as I stated above, soaring food prices/rising energy costs make QE3 much less likely, in my opinion. Recent comments by Chinese officials suggest a more subdued approach to easing and an unwillingness to let their real estate bubble begin re-inflating. Soaring food prices also put a large dent in emerging markets easing plans. Finally, the surge in Spanish yields to records and breakouts in other European debt angst gauges suggests the recent European debt crisis can-kicking may have already run its course. There has been a growing disconnect between US equity action and the deteriorating macro environment that is eerily similar to last July, in my opinion. The macro likely must begin improving very soon for equities to avoid a similar fate into the fall. For this year's equity advance to regain traction, I would expect to see a resumption in European credit gauge improvement, a subsiding of hard-landing fears in key emerging markets, a rising 10-year yield, better volume, stable-to-lower energy prices, a US "fiscal cliff" solution and higher-quality stock market leadership. I expect US stocks to trade modestly lower into the close from current levels on surging eurozone debt angst, earnings worries, rising food prices, rising global growth fears, more shorting, financial/tech sector weakness, domestic terror fears and US "fiscal cliff" concerns.