Bull Radar

Style Outperformer:

• Large-Cap Growth -.17%

Sector Outperformers:

• 1) Gaming +3.75% 2) Oil Service +2.59% 3) Energy +1.08%
  

Stocks Rising on Unusual Volume:

• DGLY, PIR, MYL, TASR, SIMO, EIGI, MR, ESRX, CLMT and KNDI

Stocks With Unusual Call Option Activity:

• 1) ALTR 2) BBBY 3) ESRX 4) TASR 5) INFN
  

Stocks With Most Positive News Mentions:

• 1) PTEN 2) MGM 3) WBA 4) CCO 5) UA
  

Charts:

• ETFs Rising on Unusual Volume 

• Stocks Rising on Unusual Volume

Morning Market Internals

NYSE:

• Volume 8.6% Below 100-day average
• 3 Sectors Rising, 7 Sectors Declining

• 37.2% of Issues Advancing, 59.2% Declining

• 100 New 52-Week Highs, 5 New Lows

• 56.2% of Issues Above 200-day Moving Average (yesterday's close)

• Average 14-Day RSI 47.1 (yesterday's close)

• TRIN/Arms .91

Thursday Watch

Evening Headlines 
Bloomberg: 

• Tsipras Returns to Reality After Putin With Greek Cash Depleting. When his plane touches back down in Athens, Greek Prime Minister Alexis Tsipras will be quickly reacquainted with reality. Talks with Russian President Vladimir Putin in Moscow on Wednesday focused on a proposed energy pipeline, future investments and sanctions over the conflict in Ukraine, a meeting that had been dismissed before it began by Germany and France as a sideshow. With a payment to the International Monetary Fund on Thursday depleting Greek cash reserves still further, it’s back to haggling with creditors in the euro region over a financial lifeline.
• Dimon Says JPMorgan Must Be Ready for Greek Exit From Euro Area. JPMorgan Chase & Co., the largest U.S. bank by assets, needs to be ready for Greece to depart from the euro currency union, Chief Executive Officer Jamie Dimon said. “We must be prepared for a potential exit,” Dimon said Wednesday in a letter to shareholders of his New York-based bank. “We continually stress test our company for possible repercussions resulting from such an event.” 
• Sydney Property Booming While Iron Ore Slumps Shows RBA Dilemma. While investors are betting the Reserve Bank of Australia will deliver additional easing to lift an economy hit by the commodities slump, the central bank chief disappointed them this week by leaving the cash target unchanged at 2.25 percent. As he weighs the effect of 2.5 percentage points of reductions so far, he can’t help but notice house prices are buoyant, household debt is rising and borrowing by non-resource businesses is beginning to grow.   
• China’s Deflation Threat: What to Look for Beyond the Headlines. (graph) 
• Bank of Korea Holds Benchmark Rate Amid Weak Inflation, Growth. South Korea’s central bank held its key interest rate at an all-time low to monitor the impact of three cuts since August as inflation slowed and exports fell. The Bank of Korea kept the seven-day repurchase rate unchanged at 1.75 percent, as forecast by all 16 economists surveyed by Bloomberg. The BOK is expected to keep it at that level until at least the end of March 2016, according to a separate survey.
• Chinese Stocks in Hong Kong Surge Most Since 2007; Dollar Climbs. Hong Kong stocks surged the most since 2009 amid volume almost five times the average and a frenzy of buying by mainland investors. The U.S. dollar climbed after Federal Reserve meeting minutes showed division on when to raise interest rates, while gold retreated. The Hang Seng Index jumped as much as 6.4 percent and touched the highest level since 2007.
• Asian Stocks Fluctuate Near Seven-Year High; Energy Shares Drop. Asian stocks fluctuated, with the benchmark index trading near its highest level since 2008. Health-care companies gained and energy explorers fell. The MSCI Asia Pacific Index slipped 0.1 percent to 150.96 as of 9:18 a.m. in Tokyo, swinging from a gain of less than 0.1 percent.
• Dimon Says Once-in-3-Billion-Year Treasury Move Warning Shot. JPMorgan Chase & Co. head Jamie Dimon said last year’s volatility in U.S. Treasuries is a “warning shot” to investors and that the next financial crisis could be exacerbated by a shortage of the securities. The Oct. 15 gyration, when Treasury yields fluctuated by almost 0.4 percentage point, was an “unprecedented move” that would have serious consequences in a stressed environment, Dimon, the New York-based bank’s chairman and chief executive officer, said in a letter Wednesday to shareholders. Treasuries are supposed to be among the most stable securities.

Wall Street Journal: 

• After Foreclosures, Home Buyers Are Back. As their credit improves, borrowers who defaulted get reprieve. 
• Let’s Hit ‘Pause’ Before Altering Humankind. Two Nobel laureates on gene technology capable of making changes that are heritable by generations to come. 
• The Incredible Obama Doctrine. Speak softly and claim to carry a big stick, which you have no intention of ever using. Last weekend, with the ink on the Iran nuclear deal still being deciphered, the Obama Doctrine fell out of an interview between President Obama and Thomas Friedman of the New York Times. “You asked about an Obama doctrine,” Mr. Obama said. “The doctrine is: We will engage, but we preserve all our capabilities.”

Barron's: 

• Apple(AAPL): BMO Slashes Watch Forecast on Tepid Survey Data.

Fox News:

• US, Iran support for dueling sides in Yemen raises prospect of proxy fight. (video) Intervention by the U.S. and Iran in Yemen is raising the prospect of a proxy war even as the Obama administration tries to reach a nuclear deal with the Islamic Republic – with Iran sending two ships to waters near Yemen, as the U.S. speeds up military aid to the Saudi-led coalition striking Tehran-backed rebels there.
• Cheney slams Obama in radio interview, says policies aim to 'take America down'. “I vacillate between the various theories I’ve heard, but you know, if you had somebody as president who wanted to take America down, who wanted to fundamentally weaken our position in the world and reduce our capacity to influence events, turn our back on our allies and encourage our adversaries, it would look exactly like what Barack Obama’s doing,” Cheney said.

MarketWatch.com:

• Bed, Bath & Beyond(BBBY) shares drop after Q4 sales, Q1 forecast miss.

CNBC: 

• Alcoa(AA) beats on earnings, falls short on revenue. Alcoa reported quarterly earnings that beat analysts' expectations on Wednesday, but its revenue fell slightly short. The company, which is in the midst of a major business transformation push, reported adjusted first-quarter earnings per share of 28 cents on revenue of $5.82 billion. Analysts had expected Alcoa to report earnings of 26 cents per share on $5.94 billion in revenue, according to a consensus estimate from Thomson Reuters.

Zero Hedge: 

•  If You Are A Chinese Stock Market Investor, Do Not Look At This Chart. (graph)
• "Odious Debt" Has Finally Arrived: Greece To Write Off "Illegal" Debt. (video)
• Vietnam Shuns US, Joins Russia-Led Economic Union.
• Smart Meters: Enforcement Of Mandatory Water Restrictions Is Only Just The Beginning.
• Hillary Clinton's Interactive Web Of Money.
• Non-GAAP Gimmickry 101: How Alcoa Just Beat Consensus EPS. (graph)
• 15 Years Of Stimulus - Nothing To Show. (graph)
• Euro Corporate Bond Market Is "Tenacious Bubble," UBS Says. (graph)
• Right Now, In Hong Kong... (graph)
• Auto-Loan Bubble Endgame - Used-Car Prices Have Stalled. (graph)

Business Insider:

• JAMIE DIMON: 'There will be another crisis'.
• The war against ISIS has reached a crucial point.
• The White House just trolled Netanyahu on Twitter.

Reuters: 

• Dollar extends gains as hawks hear hike in Fed talk. The dollar hovered at one-week highs early on Thursday, having enjoyed another leg up after two influential Federal Reserve officials kept alive expectations for a hike in interest rates sometime this year. 
• Emanuel's re-election present: Chicago's fiscal nightmare is just beginning. Rahm Emanuel may have been elected to a second term as Chicago's mayor on Tuesday but now he faces a stark choice: inflict pain on the city's population in the form of unpopular measures such as higher taxes or kick its problems further down the road and risk a fiscal crisis that could even lead to bankruptcy later.
• Hedge funds return 2.4 pct in Q1, beating broad stock index -HFR.

Telegraph: 

• Alexis Tsipras risks fresh schism with Europe after warning of new Cold War with Putin. Leftist leader uses Kremlin visit to assert Greece will forge an independent foreign policy as his near-bankrupt government courts eastern suitors.

Evening Recommendations 

• None of note

Night Trading

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

• Asia Ex-Japan Investment Grade CDS Index 105.0 -2.0 basis points.

• Asia Pacific Sovereign CDS Index 57.75 unch.

• S&P 500 futures -.01%.

• NASDAQ 100 futures +.01%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (STZ)/.94
• (ANGO)/.16
• (HGR)/.44
• (PSMT)/.98
• (RT)/-.03 

Economic Releases
8:30 am EST

• Initial Jobless Claims are estimated to rise to 283K versus 268K the prior week.
• Continuing Claims are estimated to rise to 2350K versus 2325K the prior week.
  

10:00 am EST

• Wholesale Inventories for February are estimated to rise +.2% versus a +.3% gain in January.
• Wholesale Trade Sales for February are estimated to rise +.3% versus a -3.1% decline in January.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Eurozone Industrial Production report, China CPI report, USDA's WASDE report, $13B 30Y T-Bond auction, Bloomberg April US Economic Survey results, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report and the (LB) sales conference call could also impact trading today.

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

Stocks Slightly Higher into Final Hour on Buyout Speculation, Less Emerging Markets Debt Angst, Short-Covering, Biotech/Gaming Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 14.32 -3.11%

• Euro/Yen Carry Return Index 135.35 -.38%

• Emerging Markets Currency Volatility(VXY) 9.63 -2.23%

• S&P 500 Implied Correlation 65.20 +.77%

• ISE Sentiment Index 127.0 +30.93%

• Total Put/Call .96 -3.03%

• NYSE Arms 1.07 -.27% 

Credit Investor Angst:

• North American Investment Grade CDS Index 60.53 +.49%

• America Energy Sector High-Yield CDS Index 1,104.0 +.78%

• European Financial Sector CDS Index 65.79 -1.06%

• Western Europe Sovereign Debt CDS Index 21.89 +.27%

• Asia Pacific Sovereign Debt CDS Index 57.89 +.04%

• Emerging Market CDS Index 293.38 -3.54%
  

• iBoxx Offshore RMB China Corporates High Yield Index 115.07 +.18%

• 2-Year Swap Spread 24.75 -.5 basis point

• TED Spread 25.75 unch.

• 3-Month EUR/USD Cross-Currency Basis Swap -21.5 +.25 basis point

Economic Gauges:

• 3-Month T-Bill Yield .02% unch.

• Yield Curve 137.0 unch.

• China Import Iron Ore Spot $48.05/Metric Tonne -.02%

• Citi US Economic Surprise Index -55.0 +.7 point

• Citi Eurozone Economic Surprise Index 57.60 -4.9 points

• Citi Emerging Markets Economic Surprise Index 5.2 +.6 point

• 10-Year TIPS Spread 1.84 -3.0 basis points

Overseas Futures:

• Nikkei Futures: Indicating +103 open in Japan

• DAX Futures: Indicating +37 open in Germany

Portfolio: 

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

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

• Market Exposure: Moved to 50% Net Long

Today's Headlines

Bloomberg:

• Tsipras Tells Putin EU Sanctions on Russia Are Economic War. Russian President Vladimir Putin and Greek Prime Minister Alexis Tsipras said they want to restore ties between their countries amid signs of a schism among some European Union states on whether to maintain sanctions against Russia over the conflict in Ukraine. “Greece is a sovereign country with unalienable rights,” Tsipras said after meeting with Putin in Moscow on Wednesday. The Greek premier said he disagrees with the logic of sanctions, which he described as “an economic war,” and called for “a new spring in ties between our countries.”
• Merkel Ally Says Greece Is Free to Make Russian ‘Mistake’. A party ally of German Chancellor Angela Merkel said raising dependence on Russia is Greece’s “mistake” to make, though there’s no reason to condemn any loan by the Kremlin to Europe’s most-indebted state. Norbert Roettgen, a lawmaker with Merkel’s Christian Democratic Union who is chairman of the parliamentary foreign affairs committee, commented in a phone interview as Greek Prime Minister Alexis Tsipras seeks closer ties to Russian President Vladimir Putin during a three-day visit to Moscow.
• Dzhokhar Tsarnaev Convicted of 2013 Attack on Boston Marathon. Dzhokhar Tsarnaev was convicted of carrying out the biggest terror attack on U.S. soil since 2001, as jurors in the Boston Marathon bombing case now turn to the more difficult task of deciding whether he should die.
• While the Shanghai Stock Market Keeps Surging, Some Investors Are Getting Out. Wednesday trading brought some puzzling signals from China’s equity markets. On the one hand, the Shanghai Composite Index briefly exceeded the psychologically important 4,000 threshold, before closing at 3994.81 for the day. On the other hand, Chinese mainland investors used their entire 10.5 billion yuan daily quota to shift funds to Hong Kong. 
• Russian Car Sales Have Utterly Collapsed. (graph) Consumer demand has disappeared. 
• German Factory Orders Drop for Second Month. German factory orders unexpectedly fell for a second month in February in a sign Europe’s largest economy is still prone to risks. Orders, adjusted for seasonal swings and inflation, fell 0.9 percent after a revised decline of 2.6 percent in January, data from the Economy Ministry in Berlin showed on Wednesday. The typically volatile number compares with a median estimate of a 1.5 percent increase in a Bloomberg survey. Orders slid 1.3 percent from a year earlier.
• Europe Stocks Are Little Changed After Rising Above Record Close. European stocks, which surpassed a record close earlier, pared gains as oil extended losses. The Stoxx Europe 600 Index added less than 0.1 percent to 404.66 at the close of trading. It rose as much as 0.4 percent to 405.78 intraday, surpassing the March 2000 level.
• Fed Officials Divided Over June Liftoff, FOMC Minutes Show. Federal Reserve policy makers last month were split over whether they would raise interest rates in June, a debate that occurred before recent disappointing payroll figures, minutes of their most recent policy meeting showed. “Several participants judged that the economic data and outlook were likely to warrant beginning normalization at the June meeting,” according to minutes of the March 17-18 Federal Open Market Committee session released Wednesday in Washington.

Wall Street Journal: 

• Post-Crisis Risk Casts a Darkening Shadow. Regulators’ banking safeguards drive an increasing amount of financial activity away from conventional venues. Squeezing risk out of the economy can be like pressing down on a water bed: The risk often re-emerges elsewhere. So it goes with efforts to make the financial system safer since the financial crisis. Officials have forced banks to bulk up their capital buffers, ditch dangerous lines of business and pay more than $100 billion in penalties for bad behavior. As a result, risky...
• China to Build Pipeline From Iran to Pakistan. Long-thwarted project gets go-ahead as Islamabad anticipates lifting of sanctions on Iran.

CNBC:

• Cashin: This was a one-two punch for the markets. (video) 
• AT&T(T) data breaches revealed: 280K US customers exposed.

ZeroHedge: 

• Iran Enters Hornets Nest: Parks Two Warships Off Yemen Coast Immediately Next To Two US Aircraft Carriers.
• Japan Shocked To Find Abenomics Is Destroying Its Middle Class.
• Cushing Storage Around 90% Full As Inventories Surge Most In 14 Years, Crude Plunges. (graph)
• Bernanke Has The Courage To Call His Upcoming Memoir The "Courage To Act".
• The Shell-BG Megadeal: All You Need To Know, And Why The Initial Response Is Not Enthusiastic.
• Putin And Tsipras Are Meeting: Here Are The Main Highlights.
• Swiss Government Becomes First Ever To Issue 10Y Debt At A Negative Yield. (graph)
• FOMC Minutes Expose World Weary, Un-Patient, Dow-Data-Dependent Fed.

Business Insider: 

• Crude oil is tanking. (graph)
• The Apple(AAPL) Watch reviews are (quietly) brutal.
• Shares of drugmaker Perrigo(PRGO) are going insane after a buyout offer from Mylan(MYL).
• US general: Russian long-range bombers are 'messaging' the US with provocative flights.
• Greece has a major debt repayment to make in the next 24 hours and the situation is looking desperate. 
• This chart shows why everyone is scared about China's economy.

Telegraph: 

• Exhausted world stuck in permanent stagnation warns IMF. The global economy is acutely vulnerable to a fresh recession with debt ratios at record highs. The authorities have already used up most of their ammunition. 
• Risky mortgages are back on the rise. Bank of England survey shows increase in willingness to lend more than 90pc of a home's value.

Bear Radar

Style Underperformer:

• Large-Cap Value +.01%

Sector Underperformers:

• 1) Coal -2.36% 2) Oil Tankers -.70% 3) Oil Service -.70%

Stocks Falling on Unusual Volume:

• BIP, LGF, FLML, HUBS, PRTA, LBIO, AFAM, PNR, WHR, OVAS, BIS, TA, VRTS, TRCO, TISI, SSP, SCHN, MCK, FDX, GEOS, CLDN, RENT, VMC, CWEI and AAC

Stocks With Unusual Put Option Activity:

• 1) DO 2) AKS 3) BBY 4) VMW 5) CMI
  

Stocks With Most Negative News Mentions:

• 1) DOW 2) SCHN 3) T 4) COP 5) ANGI
  

Charts:

• ETFs Falling on Unusual Volume

• Stocks Falling on Unusual Volume