Bull Radar

Style Outperformer:

• Large-Cap Growth +.1%

Sector Outperformers:

• 1) Papers +1.2% 2) Semis +1.0% 3) Disk Drives +.5%

Stocks Rising on Unusual Volume:

• ESPR, CTMX, DDC, NKTR, DSPG, YIN, FEYE, OMER, ARII, CRBP, JAZZ, EVBG, YRD, XPER, MDCO, ALRM, WYNN, HTHT, SHOP, UCTT,  BLCM, OMER, HAWK, LJPC and VSAR

Stocks With Unusual Call Option Activity:

• 1) FEYE 2) ESPR 3) SNAP 4) DOW 5) MU

Stocks With Most Positive News Mentions:

• 1) FEYE 2) ARII 3) JAZZ 4) CF 5) TIF

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -23.5% Below 100-Day Average
• 6 Sectors Rising, 4 Sectors Declining
• 40.7% of Issues Advancing, 55.1% Declining
• 71 New 52-Week Highs, 12 New Lows
• 58.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 40.6%
• Vix 11.1 -2.0%
• Total Put/Call 1.03 +6.19%
• TRIN/Arms 1.01 -42.5%

Monday Watch

Today's Headlines

Bloomberg:

• Yellen's Shadow Looms Large Over Policy at China's Central Bank. Call it the Yellen effect. The Federal Reserve’s March 15 rate hike underscored a subtle shift at the People’s Bank of China: long reluctant to be influenced by global counterparts, it now appears to be in step with the U.S. That was displayed by the PBOC raising borrowing costs just hours after the Fed lifted interest rates last week. Observers see the objectives as supporting the yuan by keeping a lid on the interest rate differential and taming a surge in lending that’s fueled financial risk.

• Deutsche Bank to Raise $8.6 Billion After Pricing Share Sale. Deutsche Bank AG said it will raise 8 billion euros ($8.6 billion) from a capital increase starting this week as the lender seeks to shore up its finances and boost growth. The Frankfurt-based company will issue 687.5 million new shares at 11.65 euros apiece, it said in a statement on Sunday, in-line with the bank’s March 5 announcement on the planned sale. The shares are priced at a discount of about 35 percent from Friday’s close and almost 41 percent since Bloomberg first reported that the bank was weighing a capital raising. Existing investors will be able to acquire one new share for each two shares they now hold.

• Stocks Point to Mixed Start in Asia; Bonds Climb. A dearth of risk appetite greeted markets at the start of the week. Stock futures indicated a mixed open for the Asia Pacific region, with global equities trading just shy of an all-time high. Australian equity-index futures slipped and Hang Seng contracts were flat. Japan’s stock market is closed Monday for a holiday and New Zealand’s main index tumbled the most since November. The 10-year yield on Australian government bonds resumed a retreat after a rally Friday. The yen maintained its strength from last week. The yen traded at 112.70 per dollar as of 7:25 a.m. in Tokyo. That comes on the back of its strongest week since the start of February. New Zealand’s S&P/NZX 50 Index declined 1.2 percent. Futures on Australia’s S&P/ASX 200 Index lost 0.2 percent and contracts on the Hang Seng slid less than 0.1 percent.

• Ezra Files for U.S. Bankruptcy as Marine Debt Crunch Spreads. Ezra Holdings Ltd., a Singapore-listed oilfield services group, filed for bankruptcy in the U.S. after weeks of facing hostile actions from creditors at home and abroad as it struggles to recover from a slump in oil prices over the past three years. Ezra and two affiliates, Ezra Marine Services Pte. Ltd. and EMAS IT Solutions Pte. Ltd., filed for Chapter 11 protection March 18 in U.S. Bankruptcy Court in White Plains, New York. Ezra listed consolidated long-term assets with a value of $1.3 billion and current assets of $623 million for the fiscal year ended August 31, 2016, according to court papers. Ezra’s 20 largest creditors without collateral securing their claims are owed about $607.6 million, according to court papers. Ezra’s three largest secured creditors are owed about $61.9 million.

• Cerberus-Backed Albertsons Said to Consider Merger With Sprouts. Albertsons Cos., the grocery-chain operator backed by Cerberus Capital Management, has held preliminary talks to merge with Sprouts Farmers Market Inc., people with knowledge of the matter said. The discussions, which took place in recent weeks, are at an early stage and may not lead to a deal, said the people, who asked not to be named discussing private details. The talks have involved a plan to take organic grocer Sprouts private and add it to Albertsons’ portfolio, which includes eponymous grocery stores and the Safeway store brand.

• Post-Fed Calm in Treasuries Masks a Raging Bulls-Bears Debate. The Federal Reserve’s rate hike is in the rear view mirror, Treasuries volatility is tumbling and the consensus on Wall Street is for 10-year yields to tread water through June. Yet beneath that apparent calm, the range of forecasts in the latest Bloomberg survey underscores that a debate is simmering over whether long-term yields are poised to enter a bear market or just keep bumping around in months-old ranges.

Wall Street Journal:

• It’s Good to Be a CEO, Again: Stocks Rise, and So Does Pay. Twice as many top American companies increased their chiefs’ pay in fiscal 2016 as cut it.

• Donald Trump’s Bumpy Early Weeks Slow His Agenda. While markets reflect optimism, controversies and legislative infighting impede momentum. 

• Gorsuch, a Conservative Firebrand in College, Evolved Into a Conciliator. President Donald Trump’s Supreme Court nominee wins praise from Democrats for his civility and respect for opposing views, but some high school and college acquaintances remember him as a provocateur who took after his dynamic mother, a Reagan cabinet member.

Barron's:

• Had bullish commentary on (DIS), (JPM), (CME) and (HD). 

• Had bearish commentary on (GOOS), (TLT) and (GRUB).

Fox News:

• Dems struggle to stir up energetic opposition to Gorsuch. (video)

• Comey set to testify on Capitol Hill on Russia, hacking, wiretapping. (video)

• Trump says North Korea dictator 'is acting very, very badly'. (video)

CNBC:

• China boasts the 'best' relationship with Trump's US, says former PBOC member.

Zero Hedge:

• The Long Run Economics Of Debt Based Stimulus.

• Germany Slams Trump's Claim That It Owes "Vast Sums" To NATO And The U.S.

• Paul Ryan Reveals Latest Changes To Republican Healthcare Bill.

• Warning Signs. (graph)

• The Broken Bond Market - All Noise, No Signal. (graph)

• Uber President Quits After Allegedly Deciding Series Of Scandals Were Just Too Much.

• FX Week Ahead. (graph)

• Bank Loan Creation Crashes At Fastest Pace Since The Financial Crisis. (graph)

• Morgan Stanley(MS): "Only One Thing Will Allow Central Banks To Keep The Party Going".

• Intel Chair: "No Collusion Between Trump and Russia... Leak Is The Only Crime".

• David Stockman Offers "More Proof Of Janet Yellen's Idiocy".

• Another Senior Russian Official Has Died.

Business Insider:

• One of Wall Street's biggest theories about higher interest rates is about to be tested.

• Here's what 9 Wall Street gurus think about the Fed's rate hike.

• Republicans are changing their health care bill to help older Americans.

• 7 signs Japan has become a 'demographic time bomb'.

• A top Wall Street report has some bad news for stock traders.

CNR:

• China to Prevent Excessive Credit in the Property Market. Home price rises in some cities have pushed up costs of real economy, citing National Development and Reform Commission Chairman He Lifeng. He sees imbalance between China's property market and the real economy.

Night Trading

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

• Asia Ex-Japan Investment Grade CDS Index 86.25 -1.75 basis points.

• Asia Pacific Sovereign CDS Index 25.25 -2.75 basis points.

• Bloomberg Emerging Markets Currency Index 72.10 +.07%.

• S&P 500 futures -.19%.

• NASDAQ 100 futures -.13%.

Morning Preview Links

Earnings of Note

Company/Estimate

• (MOV)/.23

Economic Releases
8:30 am EST

• The Chicago Fed National Activity Index for February.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Evans speaking, Germany PPI report and the (WFC) February update could also impact trading today.

BOTTOM LINE: Asian indices are modestly lower, weighed down by technology and commodity 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 European/Emerging Markets/US High-Yield debt angst, tax reform worries and oil declines offset economic optimism, buyout speculation and yen weakness. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 75% net long heading into the week.

Today's Headlines

Bloomberg:

• U.S. Stocks Eke Out Weekly Gain, Led by High-Dividend Companies. U.S. equities rose this week thanks largely to advances in companies with high dividends that investors turn to when bond yields fall. The S&P 500 Index added 0.2 percent to 2,378.25. The biggest boost came Wednesday after the Federal Reserve raised the benchmark lending rate a quarter point and maintained its projection for two more increases this year. At the same time, the Bloomberg Economic Surprise Index advanced for the fourth straight week as data from payrolls to inflation figures met or exceeded estimates. The Dow Jones Industrial Average was little changed at 20,914.62. The Russell 200 Index jumped 1.9 percent, the most since December.
• G-20 Nations Renew Commitment to Global Bank-Capital Overhaul. Finance chiefs of the Group of 20 nations renewed their pledge to finalize an overhaul of global bank-capital rules, but stopped short of making progress on certain proposals that have led to a standoff between Europe and the U.S. In the statement capping a two-day meeting in the German town of Baden-Baden, the G-20 urged the Basel Committee on Banking Supervision to finalize the Basel III reforms “without further significantly increasing overall capital requirements,” sticking to previous language. After the work already missed a year-end deadline, the document didn’t include a new time frame.
• China Home-Price Rises Regain Speed, Defying Purchase Curbs. China home prices rose last month in more cities despite increased restrictions on property transactions by local authorities. New home prices, excluding subsidized housing, gained in February in 56 out of 70 cities tracked by the government, compared with 45 in January, the National Bureau of Statistics said Saturday. Prices climbed in 67 out of 70 cities from a year earlier, compared with 66 in January.
• Tim Cook Says Apple(AAPL) Not Aiming for Specific China Market Share. Apple Inc. doesn’t have a specific goal for market share in China, where it faces the fiercest local competition anywhere, Chief Executive Officer Tim Cook said. China has unique characteristics, in that its mobile payment market is well ahead of the U.S. and local consumers have a greater willingness to change habits, Cook said at a panel discussion at the China Development Forum in Beijing. He added that Apple’s new research and development centers in the country should help the company reach China’s university community.
• Buffett Opposes Proposal to Disclose Political Donations. Berkshire Hathaway Inc. investors will have a chance to vote on three shareholder resolutions opposed by Chairman Warren Buffett and his board, including a call for the firm to disclose any political contributions. Other proposals by shareholders would push Berkshire to divest holdings in companies that produce fossil fuels, and set targets for cutting methane emissions related to its operations, according to a proxy filing issued Friday. Berkshire said that its board unanimously opposes all three proposals.

Wall Street Journal:

• Bidding Process for U.S. Border-Wall Construction Begins. Requests for proposals are latest steps in push to fulfill campaign promise—despite significant legal, logistical challenges.
• Treasury’s Mnuchin Fends Off Push to Reject Protectionism. G-20 finance chiefs fail to reach agreement on language rejecting protectionism, signaling rift on trade.
• Tillerson Treads a Fine Line in China Talks Amid North Korea Tensions. Meeting follows comments from U.S. secretary of state that military action toward North Korea is an option.

Fox News:

• Pence takes ObamaCare replacement pitch to Florida, thanks voters for 2016 win. (video)

CNBC:

• This is the biggest risk BlackRock sees in the bond market. (video)
• Rio Tinto's chief sees one ‘key source of uncertainty’ for iron ore.
• Bill Gates wants to tax robots, but one robot maker says that's 'as intelligent' as taxing software.

Zero Hedge:

• Trump Wins: G-20 Drops 'Anti-Protectionist, Free-Trade, & Climate-Change Funding' Commitment.
• Trump Warns Germany "Owes Vast Sums To US... Must Be Paid For Defense".
• Row Breaks Out At G-20 Over Future Of Global Trade.
• Radicalized Muslim Killed After Seizing Soldier's Gun At Paris Orly Airport In Terrorist Attack.
• These Are The Most Dangerous Countries For American Tourists.
• Oil Shorts Soar By 2nd Most In History As OPEC Hope Fades. (graph)
• Yardeni Warns "Late In The Game To Be A long-Term Investor" In Stocks.
• Trump Thinks Your Car's Gas Mileage Is... Your Business.
• Laptop With "Highly Sensitive" Trump Data, Clinton Email Probe Info Stolen From Secret Service Agent.
• Beijing Goes Global: China Expands Marine Force 400%; First Overseas Military Base Almost Complete.
• Trump's Budget A First Step Toward De-Politicizing Science. 
• Americans Will Be The Loser In The Fed's Dangerous Game Of "Chicken".
• The Debt Ceiling Deadline Has Passed; Now The Biggest Test Of Donald Trump's Presidency Begins...
• Why The Fate Of The World Economy Is In The Hands Of China's Housing Bubble.
• Stocks Sink On 'Quad Witch' As Dollar Suffers Worst Week In 8 Months. (graph)
• Why Is Goldman On A Buying Spree For Delinquent Mortgages.
• Weekend Reading: Just Buy Everything.

Business Insider:

• US housing starts were on a record upswing in February.
• Tillerson finally speaks: 'The threat of North Korea is imminent'.
• Meet the 8 hedge fund managers who made the most money in 2016.
• Airline stocks just got a lot more bullish.
• Wall Street banks are bullish on oil despite the jump in Saudi Arabia's output.

Market Week in Review

• S&P 500 2,382.85 +.49%*

The Weekly Wrap by Briefing.com.

*5-Day Change