Bull Radar

Style Outperformer:

• Large-Cap Growth -.3%

Sector Outperformers:

• 1) Coal +1.6% 2) HMOs +.4% 3) Gaming +.3%

Stocks Rising on Unusual Volume:

• CNCE, BITA, IVAC, FWONK, FRGI, VRTU, CARA, RUTH, SUPN, LXRX, HIIQ,YRD, RRC, CR, UCTT and PTCT

Stocks With Unusual Call Option Activity:

• 1) PAH 2) BHI 3) MAR 4) HYG 5) UTX

Stocks With Most Positive News Mentions:

• 1) EXPE 2) DOW 3) DD 4) FAST 5) TGTX

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume

Morning Market Internals

NYSE Composite Index:

• Volume Running -8.2% Below 100-Day Average
• 1 Sector Rising, 9 Sectors Declining
• 22.0% of Issues Advancing, 74.3% Declining
• 13 New 52-Week Highs, 37 New Lows
• 60.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 40.2%
• Vix 11.4 +3.8%
• Total Put/Call .96 +1.0%
• TRIN/Arms 1.09 +36.9%

Monday Watch

Today's Headlines

Bloomberg:

• North Korea Fires Multiple Missiles Which Fall Into Japan's EEZ. North Korea fired four ballistic missiles early Monday with three falling into Japan’s exclusive economic zone, the government in Tokyo said. South Korea’s Yonhap News said the regime may have launched an intercontinental ballistic missile, though there was no official confirmation of that. The move comes as South Korea and the U.S. undertake annual military drills that Pyongyang has called a prelude to an invasion.

• Draghi Seen Keeping Cool on Stimulus Drive Amid Inflation Surge. A timeline for the end of European Central Bank stimulus is taking shape among economists. Policy makers will wait until at least June before upgrading their assessment of the risks to the euro-area recovery and won’t announce another reduction in bond purchases until September, according to most respondents in a Bloomberg survey. Tapering quantitative easing and starting to raise interest rates will take until at least the end of next year and possibly into 2019.

• Coming Home to Roost: Chinese Property Investors Head for U.S. Exit. But Hong Kong might not be on their wish list. Chinese real-estate investors are losing interest in the U.S. as their concern over yuan depreciation eases and questions swirl around President Donald Trump's stance on protectionism.

• China Considers Dialing Back Electric Car Quota After Opposition. China is considering dialing back or delaying proposed measures aimed at pushing automakers to produce more electric vehicles, after industry feedback that the targets are overly ambitious.

• Wave of Islamic State Car Bombs Targets Iraqi Troops in West Mosul. Iraqi troops encountered the "heaviest" clashes yet with Islamic State group fighters Sunday in western Mosul since the start of the new push more than two weeks ago, according to a senior commander. Maj. Gen. Haider al-Maturi of the Federal Police Commandos Division told The Associated Press that IS militants dispatched at least six suicide car bombs, which were all destroyed before reaching the troops. The militants, he said, are moving from house to house and deploying snipers.

• How the Rest of the World Paved the Way for a March Fed Hike. U.S. data has been good enough to allow the Fed to hike, and global risks haven't soured the outlook.

• Li's Risks, Yellen's Optimism Make for Mixed Open. Most recent trading on futures contracts from Friday: Nikkei 225 Stock Average dropped 0.5 percent. Australia’s S&P/ASX 200 Index and Hang Seng futures both rose 0.4 percent.

Wall Street Journal:

• China’s Premier Maps Out Cautious Economic Course. Li Keqiang signals government is shifting tack after credit and infrastructure spending propped up economic growth but caused housing prices and debt to balloon.

• Conservative Groups Jeopardize GOP Plan to Repeal Affordable Care Act. Conservative groups pushing back against Speaker Paul Ryan’s plan. 

• Bullish Commodity Bets Hit Record Highs as Investors Seize on Signs of Growth. Rising interest in commodities reflects a sharp turnaround from a year ago.

• The ‘Rock Star’ Librarians Who Choose What Your Kids Read. Current and former elementary-school librarians with big social-media followings are exerting considerable sway over what kids read.

• States Ease Restrictions on Voting by Felons. Florida proposal to lift its lifetime ban would add to a nationwide trend.

• Iraqis Tell of Islamic State Brutality in Mosul. Militants deploy booby traps, use human shields as government forces advance in the city.

Fox News:

• Trump calls for congressional probe into possible wiretapping of his campaign. (video)

• ObamaCare ‘secret’ bill details will soon be made public, House Republicans say. (video)

CNBC:

• ‘March 4 Trump’ supporters gather in cities across the nation.

• Hundreds of mobile websites and apps are found to leak personal info.

• China to strengthen defenses, but budget details excluded. China pledged more support to its military on Sunday including strengthening maritime and air defenses amid efforts to safeguard sovereignty, but unusually did not give spending figures for 2017 despite promises of transparency.

• How 'Made in the USA' can see a renaissance, and what will (and won't) change. (video)

Zero Hedge:

• White House Demands Congressional Probe Whether Obama Ordered Wiretaps.

• FBI Director Asked DOJ To Publicly Reject Trump Wiretapping Claims.

• Newsmax CEO: "I Spoke To Trump About The Wiretap Story, I Haven't Seen Him This Pissed Off In A Long Time".

• North Korea Fires Four Missiles; Three Land Inside Japan's Exclusive Economic Zone.

• China Cuts Economic Growth Forecast In Annual Report: Here Are The Key Changes.

• Hedge Fund CIO: "This Is Why So Many Intelligent People Get Destroyed By Market Trends".

• The Most Un-Fun Bubble Ever. (graph)

• The Chart That Democrats Don't Want You To See. (graph)

• Deutsche Bank To Raise $8.5 Billion In New Capital, Announces Major Restructuring.

• Le Pen Odds Hit 6-Week Low As Fillon Shuns Establishment, Confirms He's Staying In French Election. (graph)

• This House Was 3D-Printed In Under 24 Hours At A Cost Of Just $10,000. (video)

• Visualizing The Worrying Decline Of Freedom Around The World. (graph)

• The Robots Sent Into Fukushima Just Keep Dying.

Business Insider:

• Dying shopping malls are wreaking havoc on suburban America.

• British chancellor on Brexit talks: 'The mood music is changing'.

• Stocks have stopped caring about rate hikes.

Reuters:

• Erdogan compares German conduct with Nazi period. President Tayyip Erdogan accused Germany of behaving as in Nazi times in cancelling political meetings of resident Turks that were due to be addressed by Turkish officials. German authorities withdrew permission last week for two rallies by Turkish residents in German cities amid growing public outrage over Ankara's arrest of a Turkish-German journalist, dragging bilateral ties to a new low.

Night Trading

• Asian indices are -.50% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 94.75 +1.0 basis point.

• Asia Pacific Sovereign CDS Index 26.5 +.25 basis point.

• Bloomberg Emerging Markets Currency Index 71.15 -.08%.

• S&P 500 futures -.39%.

• NASDAQ 100 futures -.36%.

Morning Preview Links

Earnings of Note

Company/Estimate

• (KFY)/.53

• (ALOG)/.99

• (CASY)/.89

• (DCO)/.45

• (THO)/1.22 

Economic Releases
10:00 am EST

• Factory Orders for January are estimated to rise +1.0% versus a +1.3% gain in December.

• Final Durable Goods Orders for January are estimated to rise +1.0% versus a prior estimate of a + 1.8% gain.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Kashkari speaking, Deutsche Bank Media/Intenet/Telecom Conference, Cowen Health Care Conference, Sandler O'Neil Financial Services Conference and the (FAST) Feb. sales report could also impact trading today.

BOTTOM LINE: Asian indices are mostly lower, weighed down by technology and industrial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the week.

Weekly Outlook

• Wall St. Week Ahead by Reuters.
• Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week mixed as oil gains, economic optimism and tax reform hopes offset profit-taking, European/Emerging Markets/US High-Yield debt angst and yen strength. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 75% net long heading into the week.

Today's Headlines

Bloomberg:

• S&P 500 Makes It Six Weeks of Gains as Economic Signals Brighten. U.S. stocks advanced for the sixth consecutive week as economic data sailed past forecasts and shares of financial companies rose with higher bond yields. So strong were signals on growth in the U.S. and beyond that investors were left almost completely unfazed by the surging odds of a Federal Reserve interest rate increase, as the likelihood priced by Fed funds futures more than doubled. Chair Janet Yellen on Friday capped the week of rising expectations by explicitly supporting a hike if economic progress persists. The S&P 500 nevertheless rose for the fifth time in seven days. The benchmark gauge for American equity added 0.7 percent over the five days to end the week at 2,383.12. Helped by President Donald Trump’s speech to Congress, the index briefly crossed 2,400 for the first time ever on Wednesday, before closing that session, the best of the year, at a record 2,395.96. The Dow Jones Industrial Average climbed 0.9 percent to end the week 21,005.71 as small-cap shares finished lower for a second week.

• Trump Tweets Obama Tapped His Phones, Calls Ex-President ‘Sick’. President Donald Trump said, without providing evidence, that Barack Obama had the candidate’s phones tapped during the 2016 election campaign and that a good lawyer could bring a legal case against the former president for a “Nixon/Watergate” plot. “Just found out that Obama had my ‘wires tapped’ in Trump Tower just before the victory,’’ the president wrote Saturday on his personal Twitter account. “Nothing found. This is McCarthyism!’’ Comparing Obama’s actions to those of former President Richard Nixon during the 1970s Watergate scandal, Trump took his long-running feud with the former president to a new level in four separate tweets to his almost 26 million Twitter followers. “How low has President Obama gone to tapp my phones during the very sacred election process. This is Nixon/Watergate. Bad (or sick) guy!” Trump said.

• Peugeot Reaches Deal to Buy European Brands From General Motors. PSA Group and General Motors Co. are set to announce on Monday the purchase of the Opel brand by the French company, creating the region’s second-largest automaker and allowing GM to exit the European market, according to people familiar with the matter. The two carmakers, which sent an invitation for a joint press conference in Paris on Monday, have reached a framework agreement to complete the deal, according to people familiar with the matter, who asked not to be identified because negotiations are private. While final talks on remaining details of the transaction are ongoing, PSA’s board signed off on the transaction on Friday, the people said. Spokesmen for PSA and Opel declined to comment.

• Standard Life Eyes Aberdeen to Create $811 Billion Manager. Standard Life Plc, Scotland’s largest insurer, is in talks to acquire Aberdeen Asset Management Plc, creating one of Europe’s biggest fund managers overseeing 660 billion pounds ($811 billion).

• Yellen Hints at More Aggressive Rate Path Upon Locking in March. Federal Reserve Chair Janet Yellen left little doubt on Friday that the central bank will raise interest rates this month. More importantly, she dropped hints that it might end up having to increase them this year more than planned. In a speech to The Executives’ Club of Chicago, Yellen singled out the danger of the central bank being too slow in boosting rates.

• Snap(SNAP) IPO Shows Investor Appetite to Bet on Young Companies Again.

Wall Street Journal: 

• Disturbing New Facts About American Capitalism. When winners are taking all, it's often time to buy the winners.

• Keystone Pipeline Won’t Have to Use U.S. Steel Despite Trump Pledge. President said last week that Keystone must use American steel ‘or we’re not building one’.

• Fed Officials Indicate Rate Increase Is Likely in March. Chairwoman Janet Yellen says ‘a further adjustment of the federal-funds rate would likely be appropriate’ at this month’s Fed meeting.

Barron's:

• Had bullish commentary on (ROK), (XRX), (RRC), (TRCO), (GOOGL) and (AMZN).

• Had bearish commentary on (SNAP) and (BBY).

Fox News:

• Trump expected to sign new travel ban into US by early next week. (video)

CNBC: 

• OPEC, Russia head to Texas for an away game in oil price wars.

• China to defer implementation of property tax despite surging prices.

• According to technical analysts, the current tech boom has more room to run. (video)

• China aims for around 6.5 percent economic growth in 2017. China is aiming to expand its economy by around 6.5 percent in 2017 as it continues to implement a proactive fiscal policy and maintain a prudent monetary policy, Premier Li Keqiang said on Sunday.

Zero Hedge:

• Obama Advisor Rhodes Is Wrong: The President Can Order A Wiretap, And Why Trump May Have The Last Laugh.

• "This Is Watergate": Trump Accuses Obama Of Wiretapping The Trump Tower.

• Twitter Fight Round 2: Trump Trolls "Lying" Pelosi With Pic Of Her And Medvedev; Pelosi Responds.

• The US Motorist Is Unwell: Miles Driven Suffer Biggest Slowdown In Over 2 Years. (graph)

• China Vows To Refrain From "Mega Economic Stimulus" As 'Two Sessions' Begins.

• Jim Bianco Warns "Inflation Is Going To Be A Game Changer".

• This Is The Only Chart Americans Should Be Worrying About Right Now.

• Summarizing The Chaos Ahead Of The French Presidential Elections.

• The Mainstream Is Circling The Wagons: "They're Coming For All Of Us...It's An Orchestrated Attack Against Truth".

• British University Bans All "Politically Incorrect" Words: Here's The List...

• "What Has Kept The Rally Going": Some Thoughts From Deutsche Bank. (graph)

• Obama Used Cyberattacks To Sabotage North Korean Launches For Years.

• Juncker Has Meltdown While Debating Future Of EU.

• "Message Received": Wall Street Reacts To The Fed's Imminent Rate Hike.

• Trump Advisers Call For A 'Purge' Of Obama Appointees.

• Auto Lending Update - Someone Please Explain How This Is Not A Bubble. (graph)

• TSA Launches "Invasive" Pat-Downs With "More Intimate Contact Than Before".

• Pension Benefit Guarantee Corporation Running Out Of Cash, Millions Affected.

• The Fed Is Preparing $1 Trillion In QE For The Next Recession: Deutsche.

• "February Should Have Been A Better Month" - Only 35% Of Managers Beat Their Benchmark. (graph)

• Weekend Reading: Trump's Rocket Ride.

• Stocks Shrug Off Dismal Data, Hawkish Fed; 'Animal Spirits' Soar To Record High. (graph)

Business Insider:

• Pelosi says she never met with current Russian ambassador, then photo emerges contradicting her claim.

• The Obamas could earn more than $200 million in the next 15 years. (video)

• Uber's unraveling: The stunning, 2 week string of blows that has upended the world's most valuable startup.

• Facebook(FB) begins rolling out its much-anticipated solution to "fake news".

• Bond investors should prepare for higher volatility as change comes to the Fed.

• Here's how much people working for hedge funds made in 2016.

Market Week in Review

• S&P 500 2,382.93 +.49%*

The Weekly Wrap by Briefing.com.

*5-Day Change