Today's Headlines

Bloomberg:

• Draghi Goes Face-to-Face With Bank Chiefs on Asset Health. Bank executives traveled to Frankfurt for a first meeting with European Central Bank President Mario Draghi on the ECB’s review of lenders’ assets. Chief executive officers from banks from five countries -- Germany, Belgium, Cyprus, Malta and Luxembourg -- met today with Draghi and other board members at ECB headquarters, a spokeswoman for the central bank said by telephone. The list included Europe’s largest investment bank by revenue, Deutsche Bank AG, and lenders such as Malta’s Bank of Valletta Plc. 

• ECB’s Weidmann Says Low Interest Rates Come With Risks. European Central Bank Governing Council member Jens Weidmann said low interest rates come with risks that can’t be ignored, even though the current policy stance is appropriate. “The expansive monetary policy is justified considering the outlook for price stability,” Weidmann, who heads Germany’s Bundesbank, said in a speech in Frankfurt today. At the same time, “one must not lose sight of the many challenges that come within an environment of low interest rates,” he said. 

• Pound Jumps as Carney Signals Rates May Rise Sooner Than Planned. The pound strengthened for the first time in four days after the Bank of England signaled that policy makers may consider increasing interest rates sooner than they previously forecast as the economy improves.

• European Stocks Drop as Investors Weigh Stimulus Outlook. European stocks fell, posting the biggest two-day drop in a month, as investors weighed corporate earnings and speculated stronger economic data will spur central banks to pare stimulus measures. Stada Arzneimittel AG and Banco Popolare SC declined at least 5.5 percent after reporting profit that missed estimates. ProSiebenSat.1 Media AG slumped to a five-week low after its largest shareholder sold an almost 16 percent stake. ICAP Plc advanced 4.1 percent after saying cost cuts will boost results this year. The Stoxx Europe 600 Index declined 0.6 percent to 319.82 at the close of trading. 

• Copper Falls Most in 15 Weeks on Fed Bets, China Production. Copper futures tumbled the most in 15 weeks amid speculation that the Federal Reserve will scale back U.S. monetary stimulus this year, while output of the metal rose to a monthly record in China. Fed Bank of Atlanta President Dennis Lockhart said yesterday that talks on a cut in bond purchases by the central bank “could well take place” next month. China’s output of refined copper in October climbed 23 percent to 637,000 metric tons from a year earlier. Futures have slumped 14 percent in 2013, partly on prospects for increased mine production. “Imminent tapering and Chinese output surges compounded the weakness,” Michael Turek, a senior director at Newedge Group SA in New York, said in an e-mail. Copper futures for December delivery slumped 2.3 percent to settle at $3.1595 a pound at 1:21 p.m. on the Comex in New York, the biggest drop for a most-active contract since July 26. 

• Attack on Junk-Loans Risks LBO Profits as U.S. Cracks Down. Fees for bankers and payouts for leveraged-buyout funds are at risk of being crimped as federal regulators crack down on underwriting standards in the market for high-risk, high-yield loans. The government, in an annual review of bank credit, looked at a $429 billion sample of leveraged loans and found 42 percent were “criticized,” or classified as having a deficiency that might lead to a loss. Starting in September, it sent letters demanding banks draw up plans to improve the quality of their loans and a warning that regulators will pay close attention to high-risk loan performance in stress tests.

• Yellen Rejoins QE Debate as Hearing Gives Critics Forum. Federal Reserve policy makers have publicly debated whether to maintain their bond-buying pace since well before Janet Yellen was named last month to succeed Chairman Ben S. Bernanke. One voice has been missing: Yellen’s. Tomorrow, she’ll express her views publicly for the first time in seven months on the record stimulus she’s supported and that some lawmakers are using to justify voting against her.

Wall Street Journal:

• ECB's Praet: All Options on Table. Central Bank Could Adopt Negative Deposit Rate, Asset Purchases If Needed.

• For Yellen, Fed's Dual Mandate Guides Thinking. Focus on Maximum Employment, Price Stability Likely a Focal Point at Confirmation Hearing. 

• Italian Banks Still Struggle With Bad Loans. Smaller Banks Lagging in Setting Aside Enough Money to Cover Potential Losses.

Fox News:

• Kerry's push for diplomatic deal with Iran running into congressional opposition. The Obama administration’s efforts to strike a diplomatic deal with Iran over its nuclear program is running into growing criticism on Capitol Hill, with one top lawmaker expressing concern that Secretary of State John Kerry may be willing to give up too much just to say he’s got a deal.

MarketWatch:

• 5 sites teens flock to instead of Facebook(FB). Where America’s youth go online to avoid Mom and Dad.

CNBC:

• Number of U.S. expatriations reaches record high In 2013. The Treasury Department published the names of 560 Americans who renounced their citizenship or are long-term residents who gave back their green cards during the third quarter of 2013, The Wall Street Journal reported. According to tax lawyer Andrew Mitchel who tracks the data, these expatriations reached a record high of 2,369 for the year. The prior highest number of published expatriates was in 2011, said Mitchel. 

• Art could be drawing a disturbing economic picture. The Francis Bacon painting "Three Studies of Lucian Freud" was sold for a whopping $142.4 million as part of a $691.6 million Christie's sale on Tuesday night, making it the most expensive work of art ever sold at auction. Some argue that the sale is giving us a message about inflation that investors aren't getting from the action in gold, the Dollar Index, or the government's official consumer price index data.

Zero Hedge: 

• "Frustrated" Liquidity Addicts Demand Moar From BOJ As Nikkei Rally Stalls, Abenomics Founders And "Hope Fades".

• "Unruffled" Export-Stimulating Germany Blasts Back At Barroso's Bureaucratic Blathering.

• Italian Authorities 'Raid' Apple HQ After $1.4bn Tax Fraud Allegations.

• The Definition Of Insanity. (graph)

• Watch Socialist Paradise Central Planning In Action: Venezuela Looting Edition. (video)

Business Insider:

• The Next Obamacare Shoe To Drop: When Will Insurers Freak Out?

• Democratic Unity On Obamacare Is Collapsing.

Washington Times:

• Concierge medicine: WebMD(WBMD) pockets millions from feds to promote Obamacare.

LA Times:  

• Obama supporter miffed at botched healthcare rollout. Margaret Davis favors wider access to insurance, but under the Affordable Care Act she'd see her premiums rise 88% for inferior coverage.

The Hill:

• DCCC chairman: 'Worst may be yet to come' on budget negotiations. Democratic Congressional Campaign Committee Chairman Steve Israel (D-N.Y.) slammed Republicans in a memo Wednesday, warning that "the worst may be yet to come" in Congress with a possible showdown over the budget in the new year.

Reuters:

• Apple(AAPL), Samsung retrial kicks off over patent damages. .An Apple attorney on Wednesday said Samsung Electronics should pay $379 million for violating patents on the iPhone, as a damages retrial between the two mobile giants got underway. 

• U.S. money funds' euro debt exposure highest since '11 -JPMorgan. U.S. prime money market funds raised their of euro zone debt holdings in October to the highest level since August 2011 as pessimism over that region's economy continues to abate, a report by JPMorgan Securities released on Wednesday showed.

Telegraph:

• German trade surplus could threaten eurozone recovery, says EC. Commission says Germany’s large current account surplus could make it more difficult for Europe's struggling southern states to recover.

Bear Radar

Style Underperformer:

• Large-Cap Value -.03%

Sector Underperformers:

• 1) Airlines -1.07% 2) Steel -.60% 3) Drugs -.30%

Stocks Falling on Unusual Volume:

• CTXS, BBEP, PERY, CWCO, FI, TEAR, BNNY, ITC, DIOD, AMED, MWE, LCC, MCEP, PAMT, IEP, RYAAY, RAX, CVT, FCN, JOE, NUE, WX, OII, ESPR, TGH and AVIV

Stocks With Unusual Put Option Activity:

• 1) EWJ 2) KSS 3) XCO 4) M 5) AKS
  

Stocks With Most Negative News Mentions:

• 1) POST 2) AAPL 3) NUE 4) AMED 5) AGU
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Mid-Cap Growth +.09%

Sector Outperformers:

• 1) Retail +.74% 2) HMOs +.63% 3) Hospitals +.57%
  

Stocks Rising on Unusual Volume:

• TPH, CALL, EJ, LMIA, SINA, HMA, M, GOGO, CSIQ, GSVC, PXD, DECK and WBMD

Stocks With Unusual Call Option Activity:

• 1) LEAP 2) MTW 3) QEP 4) PANW 5) GALE

Stocks With Most Positive News Mentions:

• 1) F 2) M 3) TWTR 4) GOOG 5) LNKD
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Wednesday Watch

Evening Headlines 
Bloomberg: 

• Banks From Emerging Markets Threatened as Credit Boom Diminishes. The world’s largest emerging markets recovered quickly from the 2008 financial crisis because consumers and companies went on a borrowing binge. Now that credit spree is coming back to haunt banks in those countries. As economies cool, delinquent loans are rising from Turkey to South Africa. India is injecting money into state-run lenders facing a surge in soured debt, while Chinese banks have been told to increase provisions for the same reason. An outflow of funds from emerging markets earlier this year, sparked by speculation that the Federal Reserve would soon begin tapering its easy-credit policy, forced up interest rates in those countries and pushed down currencies. While the flight of capital halted after the Fed decided in September to continue its asset purchases, a reversal could threaten economies and banks in developing nations. “Credit growth in emerging markets has been phenomenal since 2008 because risk has been underpriced once again, thanks to zero percent interest rates in the developed world,” said Satyajit Das, author of a half dozen books on financial risk who is based in Sydney. “Many borrowers will struggle to repay the debt, and the money flows out of these markets will make the problems worse. We’re ripe for a new emerging-market crisis.” Even China, which doesn’t rely on inward cash flows to finance its economic expansion, faces a choice of restructuring its indebted and inefficient state-owned industries or allowing inflation to take hold, according to Das and other analysts. Like their Western counterparts, emerging-market governments probably will rescue failing banks if credit deteriorates, adding to those countries’ economic woes, Das said.

• Central Banks Risk Asset Bubbles in Battle With Deflation Danger. Central banks are finding it’s easier to push up stock and home prices than it is to prevent inflation from falling short of their targets. While declining costs for everything from gasoline to coffee can be good news for consumers, disinflation makes it harder for borrowers to pay off debts and businesses to boost profits. The greater danger comes when disinflation turns into deflation, which leads households to delay purchases in anticipation of even lower prices and companies to postpone investment and hiring as demand for their products dries up. “There is definitely a whiff of disinflation again taking hold globally,” Robert Sinche, global strategist at Pierpont Securities Holdings LLC in Stamford, Connecticut, said Nov. 5 on Bloomberg Radio’s “Bloomberg Surveillance.”

• Bank Indonesia Surprises on Rates in Step to Boost Rupiah Appeal. Indonesian raised interest rates to the highest level since 2009 to sustain overseas demand for the currency even as it risks hurting growth in Southeast Asia’s biggest economy. 

• Rupiah Weakens as Rate Rise Signals No Current-Account Relief. Indonesia’s rupiah and stocks fell for a fourth day after yesterday’s surprise interest-rate rise fueled speculation current-account data today will show little improvement from the second quarter’s record deficit. The currency weakened 0.7 percent to 11,673 per dollar as of 9:36 a.m. in Jakarta, according to prices from local banks. That’s just shy of the four-year low of 11,680 on Sept. 30. The rupiah, Asia’s worst performing currency this year, has tumbled 6.4 percent since trading at a seven-week high on Oct. 25. The Jakarta Composite index of shares fell 1.1 percent, taking its decline this week to 3.2 percent.

• China’s Stocks Drop as Top Party Meeting Disappoints Investors. China’s stocks slumped for the first time in three days after a top-level Communist Party meeting disappointed investors looking for details on policy shifts to combat a slowdown in the world’s second-largest economy. China Petroleum & Chemical Corp. and China Shenhua Energy Co. led declines for energy producers. Ping An Bank Co. and China Minsheng Banking Corp. slid more than 1.5 percent. Anhui Conch Cement Co. rose 1.8 percent after its parent increased its stake. Aerosun Corp. and Beijing Aerospace Changfeng Co. both jumped 10 percent after the government said it will create a committee to improve national security strategy. The Shanghai Composite Index (SHCOMP) dropped 0.8 percent to 2,109.68 at the 11:30 a.m. local-time break, while the Hang Seng China Enterprises Index (HSCEI) of Hong Kong-traded Chinese shares slid 2 percent.

• Asia Stocks Drop on China Plenum Disappointment, Fed Bets. Asian stocks fell after China’s leaders failed to outline steps to curb state dominance of the economy and amid bets the Federal Reserve may start reducing U.S. stimulus next month. Banks slumped in Hong Kong after a communique at the end of China’s four-day plenum made scant mention of financial reforms. Tencent Holdings Ltd., China’s biggest Internet company, fell 2.7 percent after a news report quoted its chairman saying the company’s valuation is “scarily” high. Noble Group Ltd. lost 5.1 percent in Singapore after Asia’s largest commodity trader by sales said profit slumped. Pioneer Corp. surged 14 percent after the Japanese maker of car stereos reported an unexpected first-half operating profit. The MSCI Asia Pacific Index dropped 0.6 percent to 139.01 as of 12:16 p.m. in Tokyo, heading for its first decline in three days. All 10 industry groups on the measure fell. 

• Rebar Swings as Investors Weigh Policy Shift, Weak Winter Demand. Steel reinforcement-bar futures in Shanghai swung between gains and losses as investors weighed positive long-term policy shifts in China against the short-term outlook for weaker demand in winter. Rebar for May delivery, the most-active contract on the Shanghai Futures Exchange, was 0.2 percent lower at 3,663 yuan ($601) a metric ton at 10:19 a.m. local time after earlier rising as much as 0.2 percent and falling 0.5 percent.

• Netanyahu Says Iran Stands to Gain Billions in Relief. Israeli Prime Minister Benjamin Netanyahu said Iran would reap billions of dollars under a deal to ease economic sanctions that negotiators almost reached at nuclear talks in Geneva last week. “It gives Iran a tremendous break, a hole -- not a tiny hole, but a big hole -- in sanctions,” Netanyahu said late yesterday in a speech to the Bloomberg Fuel Choices Summit in Tel Aviv. It would gain “several billion dollars’ worth that is augmented to much more.” Netanyahu has urged President Barack Obama and other world leaders to reject any deal with Iran that doesn’t dismantle its nuclear program, and opposed the accord that was offered to Iran by world powers in Geneva last week.

• Saudis Join China, Russia as UN Human Rights Council Members. China, Russia and Saudi Arabia were elected today to the United Nations Human Rights Council over protests by independent rights groups that the countries aren’t suited to serve on the world rights watchdog. The three countries have multiple outstanding requests from independent UN monitors to visit and investigate alleged rights abuses, according to New York-based Human Rights Watch. China and Russia each won 176 of 192 votes, exceeding France’s 174 votes and the U.K.’s 171. Saudi Arabia received 140 votes. The minimum required was 97. “We regret that some countries elected to the Human Rights Council have failed to show their commitment to the promotion and protection of human rights,” U.S. State Department spokeswoman Jen Psaki told reporters today.

• Gross Raises Government Debt Holdings in Flagship Fund. Pacific Investment Management Co.’s Bill Gross raised the percentage of Treasuries and other U.S. government-related debt in his flagship fund in October after the Federal Reserve unexpectedly maintained its bond purchases. The proportion of U.S. government and related debt in the $248 billion Total Return Fund climbed to 37 percent from 35 percent the prior month, data on Pimco’s website show. Mortgage debt fell to 34 percent from 35 percent in September. The Newport Beach, California-based company doesn’t comment directly on monthly changes in holdings or specific types of securities within a market sector.

• Obama to Nominate Massad as CFTC Chairman Gensler Successor. Timothy Massad, the Treasury Department official responsible for overseeing the U.S. rescue of banks and automakers after the credit crisis, will be nominated to head the country’s top derivatives regulator. President Barack Obama chose Massad, 57, to succeed Gary Gensler as chairman of the Commodity Futures Trading Commission, an agency with expansive new authority under the 2010 Dodd-Frank Act. His nomination requires Senate confirmation.

Wall Street Journal: 

• China Deepens Xi's Powers With New Security Plan. China's Communist Party plans to establish a state security committee that has the potential to cement President Xi Jinping's hold on the military, domestic security and foreign policy and help establish him as the country's most individually powerful leader since Deng Xiaoping. The move is another step toward granting Mr. Xi a level of authority that eluded his two predecessors and reverses the trend toward a collective leadership since Deng, who launched China's market-oriented reforms in 1978 and commanded respect across the military and the government. 

• Panel Unveils Shake-up in Strategy to Cut Heart Risk. Long-standing strategy jettisoned under new guidelines. The current strategy of reducing a person's heart-attack risk by lowering cholesterol to specific targets is being jettisoned under new clinical guidelines unveiled Tuesday that mark the biggest shift in cardiovascular-disease prevention in nearly three decades. The change could more than double the number of Americans who qualify for treatment with the cholesterol-cutting drugs known as statins. 

• Finding Out Where Janet Yellen Stands by Kevin Warsh. Some subjects worth exploring at her confirmation hearing on Thursday. 

• Small Business and ObamaCare. A new survey shows that employers will drop coverage and cut hours. One of President Obama's proudest boasts about the Affordable Care Act is that it helps small business. The White House website says the health law "makes it easier for businesses to find better coverage options" and "stops insurance companies from taking advantage of you, giving the consumer and business owner more control and making health-care coverage more affordable." Small businesses aren't buying it.

Fox News: 

• Western-raised jihadists pouring into Syria could threaten US in future. Most of the more than 1,000 jihadists who have poured into Syria to fight alongside Al Qaeda carry passports from North America and Europe, raising the possibility that they could easily bring terror back to the west, according to a key lawmaker who receives regular briefings on the issue. The prospect is especially chilling given that Al Qaeda-linked fighters in Syria seem determined to use the embattled nation as a haven from which to launch future attacks beyond the region, according to Rep. Mike Rogers, R-Mich., who chairs the House Intelligence Committee.

MarketWatch.com: 

• China non-performing loan ratio rises. Chinese banks' non-performing loan ratio rose slightly to 0.97% at the end of September from 0.96% a quarter earlier, the China Bank Regulatory Commission said on Wednesday. Non-performing loans totalled 563.6 billion yuan ($92.5 billion) at the end of third quarter, compared with CNY539.5 billion at the end of June, according to the banking regulator. 

• Starbucks(SBUX) owes Kraft $2.7 bln to end coffee spat.

• As investors pile in, CEOs bail out.

CNBC: 

• Citadel's Ken Griffin: I would break up the big banks. (video) Ken Griffin, one of America's best-known hedge fund investors, has a radical idea: Break up big banks, and restore competition and transparency to the financial services industry. The head of Citadel Capital came out swinging at his own industry in a rare public interview at The New York Times' DealBook Conference on Tuesday. America's banks have become not just too big to fail, but too big to manage, Griffin told Andrew Ross Sorkin. The first wave of the wand would be to separate securities trading businesses from banking businesses, reducing the kind of systemic risk that led to the financial crisis. 

• The euro could disappear in 10 years: BlackRock CEO. (video)

Zero Hedge: 

• From The Geniuses Who Brought You Brosurance, Here Comes Obamacare... For Sluts?

• "It's Not Just Harder To Get A Job - It's Harder To Get A Good Job". (graph)

• Jim Rogers: "This Is Absolute Insanity". (video)

• Why Has Nobody Gone To Jail For The Financial Crisis? Judge Rakoff Says: "Blame The Government".

Business Insider:

• Iranian Foreign Minister Calls Out John Kerry On Twitter.

• Brutal New Poll Has Obama's Approval Rating Down To 39%.

Washington Post:  

• Troubled HealthCare.gov unlikely to work fully by end of November. Software problems with the federal online health insurance marketplace, especially in handling high volumes, are proving so stubborn that the system is unlikely to work fully by the end of the month as the White House has promised, according to an official with knowledge of the project.

Reuters: 

• Japan Sept core machinery orders fall 2.1 pct mth/mth.

• Yum(YUM) China sales down 5 percent in October. KFC and Pizza Hut parent Yum Brands Inc on Tuesday said October sales at established restaurants in China fell 5 percent, as it fights to recover from a chicken safety scare and bird flu outbreak in its top market. 

• Brazil stocks drop as state-run firms sink. Brazilian stocks slipped for the third session in four on Tuesday, due mostly to a fall in shares of state-run companies Banco do Brasil and Petrobras. Mexico's IPC index edged lower, while Chile's bourse rose 0.11 percent. Brazil's benchmark Bovespa stock index fell 1.56 percent to 51,804.33, its lowest level since early September.

• Tesla(TSLA) car fires 'definitely' will not lead to recall: CEO. Tesla Motors Inc (TSLA.O) will not recall its Model S electric car despite three vehicle fires that raised safety questions and hurt the automaker's stock price, CEO Elon Musk said on Tuesday. "There's definitely not going to be a recall," Musk said during a New York Times DealBook conference televised on CNBC. "There's no reason for a recall, I believe."

Obama takes on coal with first-ever carbon limits
Read more at http://www.philly.com/philly/news/politics/20130919_ap_0f857b20e0c144a5a1e1b9dddc9f9d72.html#YRThyDOhArykUeYy.99

Financial Times: 

• Healthcare companies say new ‘Obamacare’ fees should be dropped. Healthcare companies, including big US hospital chains and insurance groups, are seeking to overturn new fees which would cost them hundreds of billions of dollars amid concerns over the troubled rollout of “Obamacare”. The move has won some bipartisan support in the US Congress.

• Biggest banks face forex probe questions. The global probe into foreign exchange manipulation has widened to include 15 of the world’s biggest banks and some of the most actively traded currencies, as lenders scramble to help authorities in exchange for leniency.

Ming Pao:

• Tencent Chairman Sees Co. Valuation as 'Scarily' High. Tencent valuation will fall if co. doesn't keep up with trends and carefully watch its technology and internet business, citing Chairman Ma Huateng at a co. event.

Evening Recommendations

• None of note
  

Night Trading

• Asian equity indices are -1.25% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 139.0 +2.0 basis points.

• Asia Pacific Sovereign CDS Index 111.0 +1.25 basis points. 

• FTSE-100 futures -.48%.

• S&P 500 futures -.34%.

• NASDAQ 100 futures -.44%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (M)/.39

• (NTAP)/.63

• (CSCO)/.50

• (RMAX)/.33

• (DDS)/1.05

• (XONE)/.01

Economic Releases
2:00 am EST

• The Monthly Budget Deficit for October is estimated at -$102.0B versus -$120.0B in September.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Bernanke speaking, Fed's Pianalto speaking, Fed's Lockhart speaking, 10Y T-Note auction, Japan GDP, BoE inflation report, weekly MBA mortgage applications report, Morgan Stanley Chemicals/Ag Conference, Goldman Sachs Industrials Conference and the JP Morgan Services Conference could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by technology and commodity 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 day.

Stocks Lower into Afternoon on Rising Emerging Markets Debt Angst, Fed Taper Worries, Technical Selling, Commodity/Financial Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 12.47 -3.33%

• Euro/Yen Carry Return Index 139.57 +.68%

• Emerging Markets Currency Volatility(VXY) 9.52 -.73%

• S&P 500 Implied Correlation 39.11 +3.73%

• ISE Sentiment Index 120.0 +12.15%

• Total Put/Call .75 -6.25%

• NYSE Arms .99 +12.93% 

Credit Investor Angst:

• North American Investment Grade CDS Index 73.28 +2.54%

• European Financial Sector CDS Index 106.86 +3.13%

• Western Europe Sovereign Debt CDS Index 62.70 -3.78%

• Emerging Market CDS Index 303.44 +1.07%

• 2-Year Swap Spread 10.5 -1 basis point

• TED Spread 18.25 -.75 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -3.5 unch.

Economic Gauges:

• 3-Month T-Bill Yield .06% unch.

• Yield Curve 244.0 unch.

• China Import Iron Ore Spot $135.90/Metric Tonne unch.

• Citi US Economic Surprise Index 17.60 -1.3 points

• Citi Emerging Markets Economic Surprise Index -14.80 -3.6 points

• 10-Year TIPS Spread 2.19 +2 basis points

Overseas Futures:

• Nikkei Futures: Indicating -63 open in Japan

• DAX Futures: Indicating -14 open in Germany

Portfolio: 

• Slightly Higher: On gains in my tech sector longs, index hedges and emerging markets shorts

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 25% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Value -.62%

Sector Underperformers:

• 1) Steel -2.34% 2) Alt Energy -2.21% 3) Coal -1.80%

Stocks Falling on Unusual Volume:

• SRPT, HOLX, RAX, AMED, LMIA, CLH, VSAT, SYMC, DF, ESE, INSY, TMUS, IEP, MCEP, ASML, ARP, ACM, LMCA, PCG, BANC, MELI, EC, BC, UEIC, ACE, VECO, NRG, PER and SDR

Stocks With Unusual Put Option Activity:

• 1) RAX 2) DISH 3) LO 4) MMM 5) KSS
  

Stocks With Most Negative News Mentions:

• 1) SRPT 2) AMED 3) NFLX 4) XOM 5) SBUX
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume