Stocks Falling into Afternoon on Global Growth Fears, Fed Rate Hike Concerns, Scotland Independece Worries, Biotech/Tech Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Slightly Above Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• Volatility(VIX) 14.10 +5.94%

• Euro/Yen Carry Return Index 144.82 -.36%

• Emerging Markets Currency Volatility(VXY) 7.35 +1.24%

• S&P 500 Implied Correlation 51.43 +3.41%

• ISE Sentiment Index 128.0 +5.79%

• Total Put/Call .83. +5.68%

• NYSE Arms .76 -1.05% 

Credit Investor Angst:

• North American Investment Grade CDS Index 60.95 +1.90%

• European Financial Sector CDS Index 60.62 +3.11%

• Western Europe Sovereign Debt CDS Index 28.44 +2.25%
• Asia Pacific Sovereign Debt CDS Index 66.46 +3.45%

• Emerging Market CDS Index 254.58 +.99%

• China Blended Corporate Spread Index 308.26 -.21%
• 2-Year Swap Spread 24.25 +.5 basis point

• TED Spread 23.0 +.5 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -13.75 +.5 basis point

Economic Gauges:

• 3-Month T-Bill Yield .01% unch.

• Yield Curve 204.0 -1.0 basis point

• China Import Iron Ore Spot $85.20/Metric Tonne +3.9%

• Citi US Economic Surprise Index 31.90 -4.3 points

• Citi Emerging Markets Economic Surprise Index -19.60 -6.7 basis points

• 10-Year TIPS Spread 2.13 -1.0 basis point

Overseas Futures:

• Nikkei Futures: Indicating -75 open in Japan

• DAX Futures: Indicating +5 open in Germany

Portfolio: 

• Slightly Higher: On gains in my index hedges and emerging markets shorts

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

• Market Exposure: Moved to 50% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Growth -1.81%

Sector Underperformers:

• 1) Social Media -4.33% 2) Alt Energy -3.82% 3) Biotech -2.32%

Stocks Falling on Unusual Volume:

• CTP, TRW, WB, RATE, MZOR, NPSP, TEX, NMM, MDU, MRTN, PLOW, SDRL, TSLA, UVV, TRP, SMLP, BRC, NILE, KWEB, UBNT, OILT, SPCB, KYE, ATVI, DISCK, ARCB, PEIX, ACAD and RATE

Stocks With Unusual Put Option Activity:

• 1) VLO 2) HFC 3) XHB 4) PHM 5) XLE
  

Stocks With Most Negative News Mentions:

• 1) GM 2) ADS 3) RAX 4) CREE 5) WEX
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Value -.20%

Sector Outperformers:

• 1) Steel +.62% 2) Energy +.15% 3) Drugs -.04%
  

Stocks Rising on Unusual Volume:

• AVNR, ALR, TAP, VNET and CLF

Stocks With Unusual Call Option Activity:

• 1) AVNR 2) TRW 3) TAP 4) HALO 5) JBLU

Stocks With Most Positive News Mentions:

• 1) LMT 2) VHR 3) AVNR 4) YHOO 5) AAPL
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Monday Watch

Night Trading

• Asian indices are -.75% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 91.50 +.5 basis point.

• Asia Pacific Sovereign CDS Index 64.25 +.75 basis point.

• FTSE-100 futures -.27%.

• S&P 500 futures -.35%.

• NASDAQ 100 futures -.36%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (ALOG)/1.11

Economic Releases
8:30 am EST

• Empire Manufacturing for September is estimated to rise to 16.0 versus 14.69 in August.

9:15 am EST

• Industrial Production for August is estimated to rise +.3% versus a +.4% gain in July.
• Capacity Utilization for August is estimated to rise to 79.3% versus 79.2% in July.
• Manufacturing Production for August is estimated to rise +.2% versus a +1.0% gain in July.
  

Upcoming Splits

• (CYT) 2-for-1

Other Potential Market Movers

• The Eurozone Trade Balance, RBA Minutes and the Morgan Stanely Industrials/Autos Conference could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by commodity and industrial 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

Week Ahead by Bloomberg. 
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 Russia-Ukraine/Mideast tensions, rising European/Emerging Markets debt angst, global growth worries, Fed rate hike concerns and technical selling. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 25% net long heading into the week.

Weekly Scoreboard*

Indices

• S&P 500 1,985.54 -1.1%

• DJIA 16,987.50 -.87%

• NASDAQ 4,567.59 -.33%

• Russell 2000 1,160.61 -.81%

• S&P 500 High Beta 33.92 -.64%

• Wilshire 5000 20,740.90 -1.08%

• Russell 1000 Growth 927.77 -.99%

• Russell 1000 Value 998.50 -1.22%

• S&P 500 Consumer Staples 461.97 -1.21%

• Solactive US Cyclical 136.49 -1.03%

• Morgan Stanley Technology 988.26 -.70%

• Transports 8,552.28 -.58%

• Utilities 549.64 -3.26%

• Bloomberg European Bank/Financial Services 110.51 -.99%

• MSCI Emerging Markets 44.04 -3.34%

• HFRX Equity Hedge 1,183.58 -.17%

• HFRX Equity Market Neutral 973.89 -.19%

Sentiment/Internals

• NYSE Cumulative A/D Line 230,501 -.49%

• Bloomberg New Highs-Lows Index -209 +480

• Bloomberg Crude Oil % Bulls 40.0 +33.33%

• CFTC Oil Net Speculative Position 299.982 -.85%

• CFTC Oil Total Open Interest 1,553,516 -.37%

• Total Put/Call .88 -13.73%

• OEX Put/Call 1.42 -41.56%

• ISE Sentiment 121.0 +15.24%

• NYSE Arms .76 -19.14%

• Volatility(VIX) 13.31 +10.09%

• S&P 500 Implied Correlation 49.63 +5.39%

• G7 Currency Volatility (VXY) 7.74 +17.99%

• Emerging Markets Currency Volatility (EM-VXY) 7.26 +13.44%

• Smart Money Flow Index 11,373.69 -.20%

• ICI Money Mkt Mutual Fund Assets $2.593 Trillion +.25%

• ICI US Equity Weekly Net New Cash Flow -$5.305 Billion

• AAII % Bulls 40.4 -9.6%

• AAII % Bears 26.6 +11.0%

Futures Spot Prices

• CRB Index 281.90 -2.12%

• Crude Oil 91.05 -2.33%

• Reformulated Gasoline 249.75 -2.73%

• Natural Gas 3.85 -.85%

• Heating Oil 273.10 -2.96%

• Gold 1,227.70 -2.16%

• Bloomberg Base Metals Index 198.67 -2.85%

• Copper 307.90 -3.44%

• US No. 1 Heavy Melt Scrap Steel 356.67 USD/Ton unch.

• China Iron Ore Spot 82.0 USD/Ton -1.91%

• Lumber 336.60 +.96%

• UBS-Bloomberg Agriculture 1,209.79 -4.10%

Economy

• ECRI Weekly Leading Economic Index Growth Rate 1.7% -10 basis points

• Philly Fed ADS Real-Time Business Conditions Index -.1058 +1.40%

• S&P 500 Blended Forward 12 Months Mean EPS Estimate 128.35 +.25%

• Citi US Economic Surprise Index 36.20 -1.7 points
• Citi Eurozone Economic Surprise Index -45.40 -2.9 points

• Citi Emerging Markets Economic Surprise Index -12.90 +.5 point

• Fed Fund Futures imply 36.0% chance of no change, 64.0% chance of 25 basis point cut on 9/17

• US Dollar Index 84.25 -.10%

• Euro/Yen Carry Return Index 145.19 +1.71%

• Yield Curve 205.0 +10.0 basis points

• 10-Year US Treasury Yield 2.61% +15.0 basis points

• Federal Reserve's Balance Sheet $4.380 Trillion +.15%

• U.S. Sovereign Debt Credit Default Swap 15.34 -8.87%

• Illinois Municipal Debt Credit Default Swap 158.0 +1.64%

• Western Europe Sovereign Debt Credit Default Swap Index 27.81 +5.64%

• Asia Pacific Sovereign Debt Credit Default Swap Index 64.24 +3.42%
  

• Emerging Markets Sovereign Debt CDS Index 218.89 +6.95%
  

• Israel Sovereign Debt Credit Default Swap 82.50 unch.

• Iraq Sovereign Debt Credit Default Swap 325.68 +3.56%

• Russia Sovereign Debt Credit Default Swap 238.16 +4.31%

• China Blended Corporate Spread Index 308.91 +.89%

• 10-Year TIPS Spread 2.14% -2.0 basis points

• TED Spread 22.5 +1.75 basis points

• 2-Year Swap Spread 23.75 +2.0 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -14.0 +5.5 basis points

• N. America Investment Grade Credit Default Swap Index 59.50 +3.86%
  

• European Financial Sector Credit Default Swap Index 58.79 +5.30%
  

• Emerging Markets Credit Default Swap Index 252.22 +11.66%
  

• CMBS AAA Super Senior 10-Year Treasury Spread  to Swaps 82.50 +.5 basis point

• M1 Money Supply $2.828 Trillion +.98%

• Commercial Paper Outstanding 1,050.80 +.30%

• 4-Week Moving Average of Jobless Claims 304,000 +1,250

• Continuing Claims Unemployment Rate 1.9% unch.

• Average 30-Year Mortgage Rate 4.12% +2 basis points

• Weekly Mortgage Applications 327.20 -7.23%

• Bloomberg Consumer Comfort 36.5 -1.2 points

• Weekly Retail Sales +4.90% +60.0 basis points

• Nationwide Gas $3.41/gallon -.03/gallon

• Baltic Dry Index 1,186 +2.68%

• China (Export) Containerized Freight Index 1,114.51 -.62%

• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 20.0 -20.0%

• Rail Freight Carloads 239,142 -12.55%

Best Performing Style

• Small-Cap Growth -.3%

Worst Performing Style

• Mid-Cap Value -1.7%

Leading Sectors

• Hospitals +5.2%

• I-Banks +4.1%

• Disk Drives +2.1%

• Banks +1.2%

• Networking +.8%

Lagging Sectors

• Oil Tankers -3.1% 

• Construction -3.2%

• Utilities -3.3%

• Energy -4.1%

• REITs -5.0%

Weekly High-Volume Stock Gainers (26)

• FLXN, BNNY, LE, MGAM, BKYF, CNVR, SSNI, CMRX, JDSU, NPSP, XPO, AVID, ULTA, PANW, TAM, RYI, BDBD, MTN, VRA, FXCM, CVGW, HQY, YHOO, WMS, LOGM and TITN

Weekly High-Volume Stock Losers (17)

• DEI, CNSI, PF, HPTX, EQY, MW, RWT, WRLD, HCN, LDOS, PAG, SHOS, MBUU, PBY, BRC, GTAT and EOPN

Weekly Charts
ETFs

• High-Volume Gainers

• High-Volume Losers

Stocks

• High-Volume Gainers

• High-Volume Losers

*5-Day Change