Stocks Rising on Diminished Global Growth Fears, Yen Weakness, Short-Covering, Retail/Financial Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Mixed
  

• Volume: Light

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 10.62 -1.85%

• Euro/Yen Carry Return Index 145.21 +.07%

• Emerging Markets Currency Volatility(VXY) 5.95 +.34%

• S&P 500 Implied Correlation 45.89 -1.48%

• ISE Sentiment Index 92.0 -26.88%

• Total Put/Call .96 +10.34%

• NYSE Arms .66 +6.28% 

Credit Investor Angst:

• North American Investment Grade CDS Index 55.95 -1.80%

• European Financial Sector CDS Index 60.46 -3.51%

• Western Europe Sovereign Debt CDS Index 31.46 +.30%
• Asia Pacific Sovereign Debt CDS Index 71.86 +.46%

• Emerging Market CDS Index 235.16 -.74%

• China Blended Corporate Spread Index 304.66 unch.
• 2-Year Swap Spread 13.5 +.25 basis point

• TED Spread 22.75 -.25 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -11.25 -.75 basis point

Economic Gauges:

• 3-Month T-Bill Yield .01% unch.

• Yield Curve 215.0 +2.0 basis points

• China Import Iron Ore Spot $96.50/Metric Tonne +1.90%

• Citi US Economic Surprise Index -9.40 +9.2 points

• Citi Emerging Markets Economic Surprise Index -8.80 unch.

• 10-Year TIPS Spread 2.26 +2.0 basis points

Overseas Futures:

• Nikkei Futures: Indicating +112 open in Japan

• DAX Futures: Indicating +3 open in Germany

Portfolio: 

• Slightly Higher: On gains in my retail/tech sector longs

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 75% Net Long

Thursday Watch

Evening Headlines 
Bloomberg:

• EU Powers Move Russia and Ukraine Closer on Truce Talks. Ukraine and Russia moved closer to a sustainable truce in talks brokered by Germany and France after President Petro Poroshenko resumed his offensive against pro-Russian rebels inspired by Crimea’s secession. The bloodshed in eastern Ukraine has reached a “dramatic climax” in the past few days, prompting the four countries to pledge to work for a comprehensive cease-fire in another round of talks by July 5, German Foreign Minister Frank-Walter Steinmeier said after meeting his counterparts in Berlin late yesterday. “It is a first and important step toward a mutual cease-fire,” Steinmeier told reporters. 

• Putin’s Economic Push Revives Former Soviet Ties in East Europe. A quarter of a century ago, when the communist regimes in central and eastern Europe tumbled one after another, the economically devastated Soviet Union could do nothing but watch. The USSR fell apart, and eastern Europeans rushed to join the North Atlantic Treaty Organization and the European Union. In its former sphere of influence, instead of sending troops like it once did, Russia is now building a web of economic ties with its old satellites. Whether it’s bankrolling a Hungarian nuclear power plant or the South Stream pipeline in Bulgaria, Russian money is buying leverage in eastern Europe, Bloomberg Businessweek reports in its July 7 edition.

• Israel Warns of Expanded Military Response After Killings. The killing of a Palestinian teenager raised fears of a cycle of revenge attacks for the death of three Israeli youths, and the U.S. urged both sides to avoid escalating tensions. Police said they were checking several possible leads for the Palestinian’s death, including criminal motives, and investigating the possibility that the victim was forced into a vehicle yesterday. Israeli Prime Minister Benjamin Netanyahu instructed police and security officers “to act as quickly as possible” to find who was behind the murder, and called on “both sides not to take the law into their own hands.”  

• Hong Kong Protesters Say More To Come If China Won’t Bend. Johannie Tong, detained for seven hours by the Hong Kong (HSI) police for an illegal democracy protest, says more people will take to obstructing the streets if China doesn’t agree to give up control over the city’s election.

• Aussie Slides as Asian Stocks Retreat Before U.S. Data. Australia’s currency fell for a second day as the country’s central bank governor said it was overvalued. Asian stocks traded near a six-year high, while the U.S. dollar maintained gains versus major peers, before jobs reports and a euro-area monetary-policy decision. Australia’s dollar slid 0.7 percent by 11:36 a.m. in Tokyo, trading at 93.8 U.S. cents after Reserve Bank of Australia Governor Glenn Stevens said investors are underestimating the chance of currency losses. The MSCI Asia Pacific Index was little changed at 147.25.

• Iron Ore Slide May See Atlas to Cliffs Rating Cuts, S&P Says. A sustained slump in iron ore prices through next year would pressure ratings for producers including Atlas Iron Ltd. (AGO) and Cliffs Natural Resources Inc. (CLF) and may trigger downgrades, Standard & Poor’s said. The steelmaking ingredient has slumped 29 percent this year as the largest producers in Australia and Brazil expand output amid waning demand in China, the biggest consumer. 

• Corn Nears Bear Market on Outlook for Biggest Ever U.S. Harvest. Corn traded on the cusp of a bear market near the lowest level in almost six months as investors weighed the outlook for the development of a record crop in the U.S., the world’s largest producer and exporter. The contract for December delivery was at $4.1825 a bushel on the Chicago Board of Trade at 11:06 a.m. in Singapore from $4.18 yesterday, when prices dropped to $4.1625, the lowest level for a most-active contract since Jan. 10.

Wall Street Journal: 

• Facebook(FB) Experiments Had Few Limits. Data Science Lab Conducted Tests on Users With Little Oversight.'

• Obama Says Further Changes to Banking Industry Are Needed. The President Said Some Changes Could Include 'Restructuring the Banks Themselves'.

• The Failure of Macroeconomics. When models don't yield the spending policies they want, some Keynesians abandon models—but not the spending.

Fox News: 

• Hurricane warning issued as Tropical Storm Arthur threatens July 4th plans along East Coast.

• US increases airport security worldwide, following report of increased terror threat.

CNBC:

• Poll: Obama worst president since WWII. According to a plurality of respondents in a new national poll, President Barack Obama is living history—in a bad way. Obama topped a new Quinnipiac University national poll that asked respondents who they thought has been the worst president since World War II. He topped the poll with 33 percent of the vote.

• Is a less pacifist-Japan on collision with China? (video)

Zero Hedge:

• The Emerging German-Russian Axis.

• The BRICs Are Morphing Into An Anti-Dollar Alliance.

• China In The Golden Age Of Central Bankers - "Whatever It Takes". (graph)

• China, Japan, And Aussie Services PMIs Drop (but Markit/HSBC Baffles...). (graph)

• Japanese Real Wages Tumble Most Since Lehman. (graph)

• Aussie Dollar Tumbles As Stevens Says "Overvalued"; Claims "Not Jawboning". (graph)

• 17 Facts That Prove That The Quality Of Jobs In America Is Going Down The Drain.

• BofE's Haldane Sees Greater Volatility Ahead; Warns Of Too-Big-Too-Fail "Problem From Hell".

• Bubble Finance At Work: How Buyback-Mania Is Gutting Growth & Leaving Financial Wrecks In Its Wake.

Business Insider: 

• Ousted American Apparel CEO Dov Charney Hands Over His Entire Stake To A Hedge Fund.

• DISASTROUS Retail Sales Number In Australia.

• Undocumented Children Are Now Being Housed At 4 Different Military Bases.

• This Chart Of Stock Market Inflection Points Is Starting To Get Pretty Scary. (graph)

• People Are Furious Over Burger King's Gay Pride Whopper.

Telegraph: 

• Juncker is galling for Britain, but life-threatening for France and Italy. The Cromwellian method by which Jean-Claude Juncker was foisted upon the nation states is a breach of the Treaties.

Liquidity crunch a catalyst for big China slowdown – analysts The mini liquidity crunch is the early warning sign of a substantial economic correction long overdue, amid rising leverage and a broken growth model, say bearish analysts.


While we want you to share, we ask you use the functions on-site rather than copy/paste. See T's & C's for details. http://www.euromoney.com/Article/3222433/Liquidity-crunch-a-catalyst-for-big-China-slowdownanalysts.html?copyrightInfo=tru

Wen Wei Po:

• China May See 63b Yuan of Maturing Trusts Default. Defaults may hit property, machinery, trade, nonferrous metals industries and may also involve new online financial products, paper sites UBS Wealth Management's Asia-Pac CIO Pu Yonghao as saying. Defaults to hit in 2H and some may be delayed to next year.

Evening Recommendations

• None of note

Night Trading

• Asian equity indices are -.25% to +.50% on average.

• Asia Ex-Japan Investment Grade CDS Index 101.25 -2.25 basis points.

• Asia Pacific Sovereign CDS Index 71.5 -1.25 basis points.

• FTSE-100 futures +.07%.

• S&P 500 futures -.07%.

• NASDAQ 100 futures  -.03%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (ISCA)/.48

• (ESI)/.71

Economic Releases
8:30 am EST

• The Trade Deficit for June is estimated at -$45.0B versus -$47.2B in April.

• The Change in Non-Farm Payrolls for June is estimated at 215K versus 216K in May.

• The Unemployment Rate for June is estimated at 6.3% versus 6.3% in May.

• Average Hourly Earnings for June are estimated to rise +.2% versus a +2% gain in May.

• Initial Jobless Claims are estimated to fall to 2560K versus 2571K the prior week.

• Continuing Claims are estimated to fall to 2560K versus 2571K prior.

9:45 am EST

• Final Markit US Services PMI for June is estimated to fall to 61.0 versus 61.2 prior.

• The ISM Non-Manufacturing Composite for June is estimated at 56.3 versus 56.3 in May.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Eurozone Services PMI, ECB Rate Decision, ECB's Draghi speaking, weekly Bloomberg Consumer Comfort Index and the Challenger Job Cuts report for June could impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and consumer shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.

Stocks Slightly Higher into Afternoon on Diminshed Global Growth Fears, Yen Weakness, Short-Covering, Metals & Mining/Healthcare Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: About Even
  

• Sector Performance: Mixed
  

• Volume: Light

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 10.72 -3.86%

• Euro/Yen Carry Return Index 145.16 -.12%

• Emerging Markets Currency Volatility(VXY) 5.89 +1.20%

• S&P 500 Implied Correlation 47.17 -4.36%

• ISE Sentiment Index 149.0 +49.0%

• Total Put/Call .86 -7.63%

• NYSE Arms .61 -40.91% 

Credit Investor Angst:

• North American Investment Grade CDS Index 57.19 +1.17%

• European Financial Sector CDS Index 62.65 -.28%

• Western Europe Sovereign Debt CDS Index 31.46 +1.50%
• Asia Pacific Sovereign Debt CDS Index 71.43 -1.79%

• Emerging Market CDS Index 238.06 +2.53%

• China Blended Corporate Spread Index 304.66 -1.84%
• 2-Year Swap Spread 13.75 +1.0 basis point

• TED Spread 23.0 +1.75 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -10.5 +.25 basis point

Economic Gauges:

• 3-Month T-Bill Yield .01% -1.0 basis point

• Yield Curve 213.0 +3.0 basis points

• China Import Iron Ore Spot $94.70/Metric Tonne +.53%

• Citi US Economic Surprise Index -18.60 +4.0 points

• Citi Emerging Markets Economic Surprise Index -8.80 -.4 point

• 10-Year TIPS Spread 2.24 unch.

Overseas Futures:

• Nikkei Futures: Indicating +55 open in Japan

• DAX Futures: Indicating +6 open in Germany

Portfolio: 

• Slightly Higher: On gains in my biotech/retail/medical sector longs

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

• Market Exposure: Moved to 50% Net Long

Wednesday Watch

Evening Headlines 
Bloomberg:

• Ukraine Talks Planned as Poroshenko Restarts Push in East. Ukraine, Russia, Germany and France are planning a meeting of foreign ministers today after President Petro Poroshenko ended a cease-fire and vowed to retake territory from separatists in the violence-torn east. Russia’s top diplomat, Sergei Lavrov, endorsed talks in Berlin proposed by his German counterpart, Frank-Walter Steinmeier, the Foreign Ministry in Moscow said on its website yesterday after a phone conversation between the two ministers. In a separate call with U.S. Secretary of State John Kerry, Lavrov called for an end to Ukraine’s military campaign against pro-Russian rebels, according to another statement. 

• Sale of 4,000 U.S. Missiles to Iraq Is Readied. The State Department has told lawmakers informally that the Obama administration wants to sell Iraq more than 4,000 additional Hellfire missiles for the government’s fight against Islamic insurgents, according to people familiar with the plan. Sale of the laser-guided missiles made by Lockheed Martin Corp. (LMT) would be in addition to 500 previously purchased, of which about 400 have been delivered. 

• Record Bond Sales Show Li Focused on GDP Over Debt: China Credit. China’s Premier Li Keqiang has promised to cut credit while also meeting a 7.5 percent economic growth target. Record bond sales last quarter show which pledge he’s prioritizing. Issuance jumped 54 percent from the previous three months to 1.55 trillion yuan ($250 billion), the most in data compiled by Bloomberg.

• Komatsu CEO Flags China Slump as Mining Nears Bottom. Komatsu Ltd. (6301), the world’s second biggest maker of building and mining equipment, said sales in China are falling more steeply than anticipated, joining larger peer Caterpillar Inc. (CAT) in flagging fraying Asian demand. Komatsu’s sales in China, where economic growth is slowing, dropped dramatically in April and May and it will probably miss its annual target for the nation, Chief Executive Officer Tetsuji Ohashi said in an interview, citing delays to the start of some construction projects.

• China’s Repression of Savers Eases.

• Best Taiwan Fund Braces for Stocks Retreat After Rally. Taiwan’s best-performing equities fund is bracing for stock market declines over the next two months after the biggest foreign inflows in Asia this year sent the benchmark index to a seven-year high.

• Asian Stocks Rise on Global Optimism as Aussie Retreats. Asian stocks climbed, with the regional index at a six-year high, and credit risk in the region fell as expanding manufacturing in the largest economies buoys the global outlook. Australia’s dollar dropped after worse-than-estimated trade figures as platinum and copper slid. The MSCI Asia Pacific Index rose 0.6 percent by 10:54 a.m. in Tokyo, trading at the highest level since June 10, 2008, as most major regional indexes gained.

Wall Street Journal:

• FTC Sues T-Mobile Over Unauthorized Wireless Charges. Commission Says Company Reaped Millions of Dollars From 'Cramming'.

CNBC: 

• Jamie Dimon says he has 'curable' throat cancer.

• China's infamous swag markets lose their shine.

Zero Hedge: 

• ISIS Is Hiring Judges, Doctors And Engineers As Al-Qaeda Prepares For War Against Caliphate.

• Was The Department Of Defense Behind Facebook’s(FB) Controversial Manipulation Study?

• Santelli Slams America's 'Debt-Is-Wealth' Mentality. (video)

• 18 Signs That The Global Economic Crisis Is Accelerating As We Enter H2 2014.

• Goldman's Global Leading Indicator Drops In June. (graph)

• Global Markets Just Reached Record "Death Cross"-iness.

• The 5 Labor Market Data Points That Will Drive Asset Markets. (graph)

Business Insider:

• New Flu Strain Created For Research Leaves The Human Immune System Completely Defenseless.

• China’s Internal Tensions Are Reaching Dangerous Levels.

• Why Hong Kong Is Having Its Biggest Protests Since 1997.

• Iran Has Deployed All Of Its Su-25 Attack Planes To Iraq.

• GASPARINO: Layoffs Are Coming To Goldman Sachs(GS).

Telegraph: 

• We must end this addiction to debt as the engine of growth. There has been no serious attempt to get to grips with the financial cycle, which requires moving away from debt as the engine of growth. 

• Russia's economic crisis deepens as EU readies fresh sanctions over Ukraine. New sanctions against Russian companies could be imposed after the collapse of the Ukraine ceasefire. 

Evening Recommendations

• None of note

Night Trading

• Asian equity indices are unch. to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 103.5 unch.

• Asia Pacific Sovereign CDS Index 72.75 -1.0 basis point.

• FTSE-100 futures -.07%.

• S&P 500 futures +.07%.

• NASDAQ 100 futures  +.09%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (GBX)/.74

• (STZ)/.93

Economic Releases
8:15 am EST

• The ADP Employment Change for June is estimated to rise to 205K versus 179K in May.

10:00 am EST

• Factory Orders for May are estimated to fall -.3% versus a +.7% gain in April.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -2,070,000 barrels versus a +1,742,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +90,000 barrels versus a +710,000 barrel gain the prior week. Distillate inventories are estimated to rise by +720,000 barrels versus a +1,177,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.71% versus a +1.4% gain the prior week.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Yellen speaking, Eurozone PPI, China Non-Manufacturing PMI, Challenger Job Cuts for June, RBC Consumer Outlook Index for July, ISM New York for June and the weekly MBA mortgage applications report could impact trading today.

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

Stocks Surging into Afternoon on Diminished Global Growth Fears, Less Emerging Markets Debt Angst, Yen Weakness, Biotech/Tech Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Light

• Market Leading Stocks: Outperforming

Equity Investor Angst:

• Volatility(VIX) 11.09 -4.15%

• Euro/Yen Carry Return Index 145.05 +.18%

• Emerging Markets Currency Volatility(VXY) 5.84 -1.18%

• S&P 500 Implied Correlation 47.84 -1.78%

• ISE Sentiment Index 116.0 +19.59%

• Total Put/Call .86 +2.38%

• NYSE Arms .93 -30.36% 

Credit Investor Angst:

• North American Investment Grade CDS Index -4.11%

• European Financial Sector CDS Index 62.83 -7.59%

• Western Europe Sovereign Debt CDS Index 31.0 +6.90%
• Asia Pacific Sovereign Debt CDS Index 72.53 -1.67%

• Emerging Market CDS Index 232.70 -1.96%

• China Blended Corporate Spread Index 310.37 +.81%
• 2-Year Swap Spread 12.75 unch.

• TED Spread 21.25 +.25 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -10.75 -.25 basis point

Economic Gauges:

• 3-Month T-Bill Yield .02% unch.

• Yield Curve 210.0 +3.0 basis points

• China Import Iron Ore Spot $94.20/Metric Tonne +.43%

• Citi US Economic Surprise Index -22.60 -.6 point

• Citi Emerging Markets Economic Surprise Index -8.40 -2.1 points

• 10-Year TIPS Spread 2.24 -1.0 basis point

Overseas Futures:

• Nikkei Futures: Indicating +115 open in Japan

• DAX Futures: Indicating +16 open in Germany

Portfolio: 

• Higher: On gains in my biotech/tech/retail/medical sector longs

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 75% Net Long

Tuesday Watch

Evening Headlines 
Bloomberg:

• Ukraine Ends Truce With Rebels as Putin Seeks to Continue Talks. Ukrainian President Petro Poroshenko ended a cease-fire with separatists and pledged to retake the country’s easternmost regions as peace efforts faltered. Poroshenko refused to extend the truce a second time, citing more than 100 violations by pro-Russian rebels, according to a statement on his website today. “A unique chance for a peace plan failed because of the criminal acts of militants,” Poroshenko said in the statement. “We will attack and we will free our land. The protection of Ukraine’s territorial integrity and the safety of its people require not only defense, but also attack.”

• No Good Iraq Options for Obama as Russia, Iran Jump In. As Russia and Iran step in to bolster the government in Baghdad, U.S. President Barack Obama has no good options to help defeat the al-Qaeda splinter group that’s proclaimed an Islamic caliphate in Iraq and Syria. The White House has offered limited military assistance to Shiite Prime Minister Nouri al-Maliki and is pushing for a coalition government to unite Iraqis as Sunni fighters from the Islamic State in Iraq and the Levant and their allies pose what Secretary of State John Kerry calls“an existential threat” to Iraq.

• Israel Vows to Strike Hamas After Finding Slain Youths. Israel vowed retaliatory action at Hamas after finding the bodies of three teenagers in the West Bank it believes were kidnapped by members of the Palestinian militant group. ``All signs indicate that they are the bodies of our three abducted youths -- Eyal Yifrach, Gilad Shaar and Naftali Frankel,'' Israeli Prime Minister Benjamin Netanyahu said in a statement. ``Hamas is responsible -- Hamas will pay.'' 

• World’s Oldest Population Drives Asian Bonds in Yield Quest. Asian bonds are reaping the benefits of Japan’s aging population like never before. Record amounts of Japanese cash are flowing into the region’s fixed-income markets as the demands of the world’s oldest population force the nation’s pension funds to load up on higher-yielding assets overseas.

• Asia Stocks Head for Six-Year High on Tankan Survey. Asian stocks rose, with the regional index headed for a six-year high, as Japanese stocks rallied with investors weighing a survey of business sentiment. Daikin Industries Ltd., a Japanese maker of air conditioners, jumped 4.3 percent, leading gains in industrial shares. Epistar Corp., a Taiwanese maker of computer chips, soared 5 percent as it plans to acquire Formosa Epitaxy Inc. Square Enix Holdings Co., a maker of entertainment software, jumped 7.6 percent in Tokyo as it seeks partners in China. The MSCI Asia Pacific Index (MXAP) gained 0.4 percent to 146.25 as of 10:57 a.m. in Tokyo, heading for the highest close since June 9, 2008.

• ECB Easy Money Lost as Real Rates Rise: Chart of the Day.

Wall Street Journal:

• Supreme Court Makes Religious Exception to Health-Care Law. High Court Sides With Employers Who Said Providing Contraceptives Violated Their Beliefs.

• Obama Plans Executive Action to Bolster Border Security. President to Act After Declaring Immigration Legislation Dead for This Year.

CNBC:

• Japan ruling parties agree to plan to drop ban on collective self-defence-lawmaker.

Zero Hedge:

• The Riskiest Housing Markets In America. (graph)

• Here Are The 28.5 Million Cars Recalled By GM In The First Half Of 2014. (graph)

• Shorts Squeezed Most In 11 Months As Russell Surges But Outperformed By Gold In H1. (graph)

• The Stock Market's Seven-Year Itch. (graph)

• California Housing And The Bubble At Hand.

• Macro Miasma: China 6Mo Highs; Japan/South Korea 9Mo Lows. (graph)

Business Insider:

• Obama Sends 200 More US Troops Into Iraq.

• Cringe-Worthy Memos Show Blatant Fraud At BNP Paribas.

• ISIS Has Attacked A Flashpoint Capable Of Plunging Iraq Into Full-Blown Civil War.

• Salesforce.com(CRM) CEO Marc Benioff Has Suddenly Sold Over $23 Million In Stock This Month.

Evening Recommendations

• None of note

Night Trading

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 103.5 -.5 basis point.

• Asia Pacific Sovereign CDS Index 73.75 +.5 basis point.

• FTSE-100 futures unch.

• S&P 500 futures +.14%.

• NASDAQ 100 futures  +.19%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (GBX)/.74

• (STZ)/.93

• (SNX)/1.36

Economic Releases
9:45 am EST

• Final Markit US Manufacturing PMI for June is estimated at 57.5 versus a prior estimate of 57.5.

10:00 am EST

• ISM Manufacturing for June is estimated to rise to 55.9 versus 55.4 in May.

• ISM Prices Paid for June is estimated at 60.0 versus 60.0 in May.

• Construction Spending for May is estimated to rise +.5% versus a +.2% gain in April.

• The IBD/TIPP Economic Optimism Index for July is estimated to rise to 48.0 versus 47.7 in June.

Afternoon:

• Total Vehicle Sales for June are estimated to fall to 16.38M versus 16.7M in May.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Eurozone PMI, Eurozone Unemployment report and US weekly retail sales reports could impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and industrial shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.