Style Underperformer:
Sector Underperformers:
- 1) Gaming -1.71% 2) Banks -1.60% 3) Computer Services -1.36%
Stocks Falling on Unusual Volume:
- PFSI, MCHX, SQI, O, SZYM, ACN, LDOS, CLVS, C, KS, WBAI, PNQI, ENZY, DWRE, MGI, CTU, CMGE, CHSP, QIHU, AI, ECYT, ARII, AYI, DATA, GOMO, CTSH, CHMT, CREE, RNG, AI and GME
Stocks With Unusual Put Option Activity:
- 1) BAX 2) CBS 3) COF 4) XLE 5) C
Stocks With Most Negative News Mentions:
- 1) GOOG 2) C 3) BA 4) ACN 5) PCLN
Charts:
Style Outperformer:
Sector Outperformers:
- 1) Steel +1.75% 2) Oil Service +1.06% 3) Telecom +.67%
Stocks Rising on Unusual Volume:
- BAX, LULU, SIG, PBR, AA, VHC, BAS and CRK
Stocks With Unusual Call Option Activity:
- 1) CL 2) VVUS 3) BAX 4) END 5) S
Stocks With Most Positive News Mentions:
- 1) LULU 2) C 3) PVH 4) TWTR 5) YELP
Charts:
Evening Headlines
Bloomberg:
- Russian Energy Giants’ Outlooks Lowered Amid Sanction Risks. Standard & Poor’s cut the credit
outlooks for Russia’s largest energy companies amid concern
international sanctions may cripple the central government. The outlooks for OAO Gazprom, OAO Rosneft, OAO Transneft
and OAO Lukoil were lowered to negative from stable today, six
days after the New York-based credit-rating service downgraded
the outlook for the Russian Federation. S&P cited the companies’
“very strong links” with the government and said geopolitical
developments may hinder Russia’s ability to support them.
- Chinese Stocks Fall After Industrial Profit Growth Slows. China’s stocks fell, sending the
benchmark index to its biggest loss in a week, after industrial
profit growth slowed at the start of the year and benchmark
money-market rates jumped. Trainmaker China CNR Corp. and China Shipping Container
Lines Co. slid more than 1 percent to drag down a sub-index of
industrial companies. Industrial profits rose 9.4 percent in the
first two months of the year, decelerating from 12.2 percent
growth in December. Shenzhen O-film Tech Co. plunged 7 percent
as a measure of technology companies slumped the most among
industry groups. The seven-day repurchase rate, a gauge of
funding availability in the banking system, rose the most in two
months. The yuan dropped for a third day, losing 0.1 percent.
The Shanghai Composite Index slipped 0.7 percent to
2,049.67 at 10:12 a.m. local time.
- Asian Stocks Fall as Bond Risk Rises With Yen on Russia.
Asian stocks fell as bond risk in the region climbed and the yen
extended gains amid concern President Barack Obama will step up pressure
on Russia. Japanese share indexes were dragged lower by dividend
payments and platinum rebounded. The MSCI Asia Pacific Index slipped 0.4 percent by 11:03 a.m. in Tokyo with Japan’s Topix index sliding 1.3 percent as
most stocks traded without the right to their latest dividend.
- Facebook(FB) Seen Struggling to Win Developers to Virtual Vision. Facebook Inc. Chief Executive
Officer Mark Zuckerberg hailed virtual reality as the “future
of computing” when he unveiled an agreement to buy Oculus VR
Inc. yesterday. Ubisoft SA isn’t so sure.
Wall Street Journal:
Fox News:
CNBC:
- Behind the massive trade that spooked the market.
Starting at 11:57 a.m. ET, a major player started buying May
1,995-strike put options on the S&P 500 for $133 per contract. The
trade was not executed in a single block, but over many smaller trades
between 11:57 and 1:12 p.m. (and the prices
of the contract varied, getting as low as $131.70). On the whole,
15,450 contracts were purchased. And since each contract controls 100
shares, this trade cost about $200 million.
- Why stocks could stay under pressure.
Zero Hedge:
ValueWalk:
- Grantham Predicts A Bust ‘Unlike Any Other’. After calling the last two market bubbles, GMO chief strategist sees another on the horizon.
GMO co-founder and chief investment strategist Jeremy Grantham is well
known for having predicted both the late 90s tech bubble and
the recent housing bubble, and now he sees an equity bubble driven by
the Federal Reserve’s loose monetary policy and years of qualitative
easing.
Business Insider:
Reuters:
- Chinese developers seek alternative financing as investors grow wary. China's
property developers
are turning to commercial mortgage-backed securities and looking
at other alternative financing as creditors grow more discriminating in
the face of rising concerns about the country's real estate and debt
markets. Bond buyers are shying away from second-tier developers
because property sales have cooled as the economy slows. The expected
bankruptcy of a local developer and the country's first
domestic bond default this month have heightened scrutiny of
borrowers.
- Amazon follows Google in slashing cloud computing prices. Amazon.com
Inc will drop prices on most of its cloud computing services starting
April 1, the largest U.S. online retailer said on Wednesday, a day after
rival Google Inc outlined a
major price cut of its own.
Telegraph:
Evening Recommendations
Night Trading
- Asian equity indices are -.50% to +.25% on average.
- Asia Ex-Japan Investment Grade CDS Index 132.0 +1.0 basis point.
- Asia Pacific Sovereign CDS Index 93.50 -.5 basis point.
- NASDAQ 100 futures +.11%.
Morning Preview Links
Earnings of Note
Company/Estimate
- (WOR)/.58
- (CMC)/.10
- (WGO)/.30
- (FRED)/.15
- (GME)/1.93
- (RMAX)/.32
- (RH)/.83
- (RHT)/.37
Economic Releases
8:30 am EST
- 4Q GDP is estimated to rise +2.7% versus a prior estimate of a +2.4% gain.
- 4Q Personal Consumption is estimated to rise +2.7% versus a prior gain of a +2.6% gain.
- 4Q GDP Price Index is estimated to rise +1.6% versus a prior estimate of a +1.6% gain.
- 4Q Core PCE is estimated to rise +1.3% versus a prior estimate of a +1.3% gain.
- Initial Jobless Claims are estimated to rise to 325K versus 320K the prior week.
- Continuing Claims are estimated to fall to 2882K versus 2889K prior.
10:00 am EST
- Pending Home Sales for February are estimated to rise +.2% versus a +.1% gain in January.
Upcoming Splits
Other Potential Market Movers
- The
Fed's Pianalto speaking, Fed's Bullard speaking, Fed's Evans speaking,
Japan CPI, $29B 7Y T-Note auction, weekly EIA natural gas inventory
report, weekly Bloomberg Consumer Comfort Index and the (NDAQ) investor
day could also impact trading today.
BOTTOM LINE: Asian indices are mostly lower, weighed down by tech and real estate
shares in the region. I expect US stocks to open modestly higher
and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.
Broad Equity Market Tone:
- Advance/Decline Line: Substantially Lower
- Sector Performance: Most Sectors Declining
- Market Leading Stocks: Underperforming
Equity Investor Angst:
- Volatility(VIX) 14.48 +3.28%
- Euro/Yen Carry Return Index 146.78 -.49%
- Emerging Markets Currency Volatility(VXY) 8.71 -1.47%
- S&P 500 Implied Correlation 55.57 +2.60%
- ISE Sentiment Index 78.0 -17.0%
- Total Put/Call 1.03 +36.0%
Credit Investor Angst:
- North American Investment Grade CDS Index 70.80 -.91%
- European Financial Sector CDS Index 97.87 -2.99%
- Western Europe Sovereign Debt CDS Index 46.80 +1.40%
- Asia Pacific Sovereign Debt CDS Index 93.23 -.86%
- Emerging Market CDS Index 291.0 -2.93%
- China Blended Corporate Spread Index 368.88 -1.63%
- 2-Year Swap Spread 10.75 -3.25 basis points
- TED Spread 19.75 +.75 basis points
- 3-Month EUR/USD Cross-Currency Basis Swap -2.25 +1.0 basis point
Economic Gauges:
- 3-Month T-Bill Yield .04% -1.0 basis point
- Yield Curve 226.0 -5.0 basis points
- China Import Iron Ore Spot $111.90/Metric Tonne +.09%
- Citi US Economic Surprise Index -31.30 +.4 point
- Citi Emerging Markets Economic Surprise Index -7.0 +.1 point
- 10-Year TIPS Spread 2.15 unch.
Overseas Futures:
- Nikkei Futures: Indicating -60 open in Japan
- DAX Futures: Indicating +7 open in Germany
Portfolio:
- Slightly Higher: On gains in my medical sector longs and index hedges
- Disclosed Trades: Added to my (IWM)/(QQQ) hedges
- Market Exposure: Moved to 25% Net Long
Bloomberg:
- Russia’s Aggression Challenges Obama’s Foreign Policy. U.S.
President Barack Obama’s plans to forge a foreign policy for a
globalized 21st Century have collided in Ukraine with what Secretary of
State John Kerry has called 19th-century behavior. The “bitter
divides of the Cold War have been replaced by unity, partnership and
peace,” said then-Secretary of State Hillary Clinton, outlining that
21st-century vision in a speech in Paris in 2010, a year
after the administration sought to “reset” relations with Russia.
“Russia is no longer our adversary, but often a partner.” In the last month, Obama and Clinton’s vision has been disrupted by
Russia’s annexation of Crimea and its troop buildup along the Ukrainian
border. Europe’s new -- or renewed -- instability reveals longstanding
weaknesses in the president’s vision of a partnership with Russia and
global cooperation with the European Union and NATO democracies as far
afield as Libya, Syria and Afghanistan, analysts, former government officials and diplomats say. “The Obama vision for European security was hinged on a couple of factors, all of which are now out the window,”
said Samuel Charap, a senior fellow at the Washington office of the
Institute of International Security Studies, a London-based policy
group.
- Europe Stocks Rise for a Second Day as Carmakers Advance.
European stocks rose for a second
day, with the Stoxx Europe 600 Index posting its biggest two-day
gain in three weeks, as auto companies climbed. PSA Peugeot Citroen
increased 2.8 percent, leading a gauge
of auto-related stocks higher, as La Tribune newspaper reported
the carmaker got more than 120,000 orders in a year for its 2008
crossover model. Standard Life Plc jumped 7 percent after saying
a unit is buying Ignis Asset Management Ltd. from Phoenix Group
Holdings. Lloyds Banking Group Plc slid the most since May 2012 as the
U.K. government sold a stake in the lender. The Stoxx 600 added 0.7 percent to 330.93 at the close of
trading.
- WTI Crude Advances as Cushing Inventories Decline.
WTI for May delivery gained 64 cents, or 0.7 percent, to
$99.83 a barrel at 1:05 p.m. on the New York Mercantile
Exchange. The volume was 16 percent below the 100-day average
for the time of day. The price was $100.08 before the EIA
report.
- Obamacare Spurs Merck, Glaxo to End Co-Pay Aid; Boost to Middle Class a Kickback? Abandoning
a long-held industry tradition, GlaxoSmithKline Plc and Merck &
Co. won’t help low-income Obamacare patients pay for their high-priced
drugs. The
drugmakers say they won’t provide the assistance until the government
decides whether programs overseen by the U.S. health-care act are
subject to federal laws banning kickbacks that steer business to
companies. So far, U.S. agencies have sent mixed messages on the issue,
industry officials said.
Wall Street Journal:
Fox News:
MarketWatch:
- A case of mistaken identity sends another Oculus soaring. Investors jumped on the news that Facebook Inc. is buying Oculus VR Inc. Problem is, they jumped to the wrong Oculus.
Oculus VR makes virtual-reality glasses. Its virtual-reality headset
is called Oculus Rift. Facebook FB -6.13% announced late Tuesday that
it would buy the whole shebang for $2 billion. Oculus VisionTech Inc.,
OVTZ despite the similar nomenclature, is unrelated. It is involved
with watermarking digital media, like videos, to protect against piracy.
But a lot of people, apparently, didn’t know that,
because its stock more than doubled on Wednesday morning.
CNBC:
- JPM, AQR win as hedge funds suck in assets. The
fat funds are getting fatter—the largest hedge funds now control more
cash than ever before. Americas-based firms that each invest at least $1
billion managed a
record high of $1.71 trillion as of Jan. 1, according to a report by hedge fund data and news service Absolute Return.
ZeroHedge:
Business Insider:
Washington Times:
@Interpreter_Mag:
- Ukraine Liveblog: Ukraine Defence Ministry calls reports of Russian troop movements "worrying".
- "400 troops in BMP/BTR vehicles & 10 tanks" less than 10km from Ukr border. 1,100 troops 120 vehicles 25 Hinds near Belgorod.
- More reports of Elite Russian armor divisions on the move, as well as attack helicopters.
Style Underperformer:
Sector Underperformers:
- 1) Alt Energy -2.84% 2) Gold & Silver -2.46% 3) Gaming -1.90%
Stocks Falling on Unusual Volume:
- BFAM, INSM, VEEV, FRAN, REX, SILC, SZYM, PNRA, IGT, SHLO, BOFI, BYI, PACW, LGF, AGN, GOMO, CAMP, CMGE, USG, EQT, DEO, XOOM, ESS, RLYP, WDAY, NMBL, CSOD and ECYT
Stocks With Unusual Put Option Activity:
- 1) CYH 2) TWC 3) AKS 4) IGT 5) IBM
Stocks With Most Negative News Mentions:
- 1) LUV 2) TWTR 3) FRAN 4) PNRA 5) WLT
Charts:
