Monday Watch

Night Trading

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

• Asia Ex-Japan Investment Grade CDS Index 77.75 unch.

• Asia Pacific Sovereign CDS Index 16.50 -1.5 basis points.

• Bloomberg Emerging Markets Currency Index 73.22 -.10%.

• S&P 500 futures +.13%.

• NASDAQ 100 futures +.18%.

Morning Preview Links

Earnings of Note

Company/Estimate

• None of note

Economic Releases 

• None of note

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The China Manufacturing PMI report and the (PSMT) monthly sales report could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by financial and industrial shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the week.

Weekly Outlook

• Wall St. Week Ahead by Reuters.

• Stocks to Watch Next Week by Seeking Alpha.

• Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week mixed as tax reform hopes, yen weakness and economic optimism offset geopolitical concerns, profit-taking and oil weakness. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 100% net long heading into the week.

Today's Headlines

Bloomberg:

• Protesters in Spain’s Streets Want to Defuse Catalonia Crisis. Catalan’s separatist leaders pushing for the region’s independence will come under more pressure on Sunday when thousands of people plan to take to the streets of Barcelona to demand the secessionists shelve their plans. Already battered by a corporate stampede to exit the region, Catalan President Carles Puigdemont is seeking to hold the momentum as the clock ticks down to a meeting on Tuesday that could trigger the separation process. Spanish Prime Minister Mariano Rajoy, meantime, must decide whether to preemptively reassert control, as some of his main allies are urging him to do.

• Death Toll Rises to 24 in Pakistan Shrine Suicide Bombing. The death toll from a suicide bombing at a Shiite shrine in the country's southwest increased to 24 after four victims died at a hospital overnight, police said Saturday. A suicide bomber struck the shrine packed with worshippers in a remote village in Jhal Magsi district, about 400 kilometers (240 miles) east of Quetta in Baluchistan province on Thursday.

• Facebook(FB) Security Chief Warns of Dangers in Fake News Solutions. Alex Stamos, who’s handling the company’s investigation into Russia’s use of the social media platform ahead of the 2016 U.S. presidential election, cautioned about hoping for technical solutions that he says could have unintended consequences of ideological bias. It’s very difficult to spot fake news and propaganda using just computer programs, Stamos said in a series of Twitter posts on Saturday.

Wall Street Journal:

• Shooter May Have Had Target Practice in the Desert Two Days Before Las Vegas Massacre. A video shows Stephen Paddock driving to an area near his home where locals go to practice shooting, a law-enforcement official said.

• Warren Buffett Bets on the Fossil-Fuel Highway.

• October's Not as Bleak as Its Reputation for Stock Market.

• How Smartphones Hijack Our Minds. Research suggests that as the brain grows dependent on phone technology, the intellect weakens.

Barron's:

• Had bullish commentary on (WMT), (CHL) and (MTCH).

Fox News: 

• Hurricane Nate makes landfall as Category 1 storm. (video)

CNBC: 

• The economy is much stronger now with Trump, billionaire Nelson Peltz says. (video)

• Hurricane Nate threatens Gulf Coast energy sites spared by Harvey.

• India's economy is reeling from recent reforms, but business leaders want more.

• The secret lives of children and their phones.

• Apparel retailer Forever 21 tests the beauty market with its first Riley Rose store.

Zero Hedge:

• After Losing Millions To Nigerian Scammers, A Bankrupt Boris Becker Is Liquidating His Assets.

• Trump Hints At War With North Korea: "Sorry, But Only One Thing Will Work".

• White House Says Trump's "Calm Before The Storm" Comment Is "Extremely Serious".

• Trump To Sign Executive Order Rolling Back Obamacare Regulations.

• Gunman Storms Saudi Royal Palace, Is Killed After Shootout With Guards.

• State Of Emergency Declared Across Southeastern US As Hurricane Nate Looms.

• Junk Bond Debt Covenant Quality Drops To All Time Lows. (graph)

• "A Civil War Is Coming" - EU Commissioner Urges Madrid & Barcelona To Talk.

• Vegas Shooter Investigators "Puzzled", Believe He Was Not Alone For Two Reasons.

• The US Government Lost Nearly $1 Trillion In FY2017... Again!

• Weekend Reading: Bull Market In Complacency.

• Investors "Most Euphoric" In 23 Years Despite Korea, Crap Data, Crude Crash, & Coming Storms. (graph)

Business Insider:

• Police have chased down more than 1,000 leads, but they still don't know why the Las Vegas shooter carried out his massacre.

• 3 men arrested in connection with New York City terror plots targeting concerts and subway system.

• US citizens claim to have had symptoms similar to diplomats attacked in Cuba.

Weekly Scoreboard*

S&P 500 2,547.54 +1.08%

The Weekly Wrap by Briefing.com.
 
Indices

• DJIA 22,760.90 +1.61%

• NASDAQ 6,583.57 +1.36%

• Russell 2000 1,508.93 +1.17%

• S&P 500 High Beta 40.01 +1.45%

• Goldman 50 Most Shorted 139.97 +.14%

• Wilshire 5000 26,450.0 +1.16%

• Russell 1000 Growth 1,274.05 +1.24%

• Russell 1000 Value 1,179.65 +.99%

• S&P 500 Consumer Staples 553.28 -.39%

• Vanda Cyclicals-Defensives 1.3786 +.40%
  

• NYSE Technology 1,615.09 +1.82%

• Transports 9,881.0 -.36%

• Utilities 730.41 +.95%

• Bloomberg European Bank/Financial Services 102.25 -.49%

• MSCI Emerging Markets 45.40 +2.01%

• HFRX Equity Hedge 1,233.06 -.07%

• HFRX Equity Market Neutral 1,014.61 -.01%

Sentiment/Internals

• NYSE Cumulative A/D Line 307,246 +.79%

• Bloomberg New Highs-Lows Index 944 +439

• Bloomberg Crude Oil % Bulls 37.5 -8.94%

• CFTC Oil Net Speculative Position 454,108 +8.6%

• CFTC Oil Total Open Interest 2,411,223 +1.4%

• Total Put/Call .83 -18.45%

• OEX Put/Call 1.72 +929.4%

• ISE Sentiment 102.0 +23.3%

• NYSE Arms .82 -30.6%

• Volatility(VIX) 10.01 +1.89%

• S&P 500 Implied Correlation 19.11 -16.5%

• G7 Currency Volatility (VXY) 7.83 -6.93%

• Emerging Markets Currency Volatility (EM-VXY) 7.96 -1.77%

• Smart Money Flow Index 19,680.85 -.03%

• ICI Money Mkt Mutual Fund Assets $2.741 Trillion +.01%

• ICI US Equity Weekly Net New Cash Flow -$7.085 Billion

• AAII % Bulls 35.6 +6.8%

• AAII % Bears 32.8 +14.1%

Futures Spot Prices

• CRB Index 181.0 -1.11%

• Crude Oil 49.40 -4.34%

• Reformulated Gasoline 155.91 -1.8%

• Natural Gas 2.87 -4.9%

• Heating Oil 175.31 -3.51%

• Gold 1,276.20 -.50%

• Bloomberg Base Metals Index 201.24 +1.66%

• Copper 302.50 +2.64%

• US No. 1 Heavy Melt Scrap Steel 288.33 USD/Metric Tonne unch.

• China Iron Ore Spot 62.24 USD/Ton +.31%

• Lumber 412.70 +2.34%

• UBS-Bloomberg Agriculture 1,021.41 -.12%

Economy

• Atlanta Fed GDPNow Forecast +2.5 +20.0 basis points

• ECRI Weekly Leading Economic Index Growth Rate 0.7% +80.0 basis points
  

• Philly Fed ADS Real-Time Business Conditions Index -.5975 +6.41% 

• US Economic Policy Uncertainty Index 310.40 +349.5%

• S&P 500 Blended Forward 12 Months Mean EPS Estimate 141.44 +.15%

• Citi US Economic Surprise Index 3.3 +11.4 points

• Citi Eurozone Economic Surprise Index 45.8 -4.4 points

• Citi Emerging Markets Economic Surprise Index 17.90 +2.9 points

• Fed Fund Futures imply 87.6% chance of no change, 12.4% chance of 25 basis point hike on 11/1

• US Dollar Index 93.88 +.85%

• MSCI Emerging Markets Currency Index 1,627.14 +.09%

• Euro/Yen Carry Return Index 137.87 -.58%

• Yield Curve 86.0 +1.0 basis point
  

• 10-Year US Treasury Yield 2.36% +4.0 basis points

• Federal Reserve's Balance Sheet $4.421 Trillion +.11%

• U.S. Sovereign Debt Credit Default Swap 24.78 +.02%

• Illinois Municipal Debt Credit Default Swap 338.30 -.05%

• Western Europe Sovereign Debt Credit Default Swap Index 5.43 +6.8%

• Asia Pacific Sovereign Debt Credit Default Swap Index 16.42 -13.6%
  

• Emerging Markets Sovereign Debt CDS Index 39.58 -8.1%
  

• Israel Sovereign Debt Credit Default Swap 47.01 -11.3%

• South Korea Sovereign Debt Credit Default Swap 73.82 -6.5%

• Russia Sovereign Debt Credit Default Swap 131.26 -7.74%

• iBoxx Offshore RMB China Corporate High Yield Index 141.87 -.09%

• 10-Year TIPS Spread 1.87% +1.0 basis point

• TED Spread 28.75 -.25 basis point

• 2-Year Swap Spread 27.5 -1.75 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -39.75 +.25 basis point

• N. America Investment Grade Credit Default Swap Index 53.85 -3.97%

• America Energy Sector High-Yield Credit Default Swap Index 398.0 -1.4%

• European Financial Sector Credit Default Swap Index 60.07 +.9%
  

• Emerging Markets Credit Default Swap Index 178.70 -3.27%
  

• CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 155.0 +2.0 basis points
  

• M1 Money Supply $3.539 Trillion -.03%

• Commercial Paper Outstanding 1,069.20 +.90%

• 4-Week Moving Average of Jobless Claims 268,250 -9,500

• Continuing Claims Unemployment Rate 1.4% unch.
  

• Average 30-Year Mortgage Rate 3.85% +2.0 basis points

• Weekly Mortgage Applications 414.0 -.38%

• Bloomberg Consumer Comfort 49.90 +1.7 points

• Weekly Retail Sales +4.1% unch.

• Nationwide Gas $2.51/gallon -.o6/gallon

• Baltic Dry Index 1,382.0 +1.92%

• China (Export) Containerized Freight Index 803.25 n/a

• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 25.0 +11.11%

• Rail Freight Carloads 286,893 +.66%

Best Performing Style

•  Small-Cap Growth +1.5%

Worst Performing Style

•  Small-Cap Value +.8%

Leading Sectors

• Airlines +4.0%

• Homebuilders +2.9%

• I-Banks +2.9%

• Defense +2.1%

• Medical Equipment +2.1%

Lagging Sectors

• Tobacco -.3% 

• Energy -.6%

• Gaming -2.2%

• Road & Rail -2.6%

• Oil Service -3.0%

Weekly High-Volume Stock Gainers (16)

• ZGNX, CTMX, TROX, CMTL, KBH, THR, BGCP, CAMP, FLXN, TRN, PICO, COLL, OFIX, EEQ, PODD and BRCD

Weekly High-Volume Stock Losers (6)

• AEGN, APPN, ANGI, BHVN, MCRB and MNTA

Weekly Charts

ETFs

• High-Volume Gainers

• High-Volume Losers

Stocks

• High-Volume Gainers

• High-Volume Losers

*5-Day Change