Bear Radar

Style Underperformer:

• Large-Cap Value -.2%

Sector Underperformers:

• 1) Medical Equipment -1.5% 2) Gold & Silver -1.3% 3) Steel -1.2%

Stocks Falling on Unusual Volume: 

• TTD, XON, PBYI, PETQ, RBA, RDFN, PINC, BRKS, HTZ, WLL and TTD

Stocks With Unusual Put Option Activity:

• 1) ROKU 2) DDS 3) EFX 4) NRG 5) DVAX

Stocks With Most Negative News Mentions:

• 1) ESL 2) FTR 3) FINL 4) RDFN 5) EPC

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Small-Cap Value +.3%

Sector Outperformers:

• 1) Education +2.0% 2) Retail +1.3% 3) Disk Drives +1.2%

Stocks Rising on Unusual Volume:

• OMER, ACO, ZOES, AYX, TWX, QBAK, COT, PEGA, DEL, OSTK, ICUI, RAIL IMMU, GOS, VGR, GWW, RCII, SQ, NWSA, VREX, CSIQ, NVDA,COLL, DGLD, TU, ROKU, SGMO, LGF/A, HA, PLSE, COLL, APTI, VSAT, BRS, M and TNET

Stocks With Unusual Call Option Activity:

• 1) EPD 2) JWN 3) KBE 4) TPX 5) XME

Stocks With Most Positive News Mentions:

• 1) NVDA 2) NWSA 3) VSAT 4) CVS 5) AL

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +11.2% Above 100-Day Average
• 6 Sectors Rising, 4 Sectors Declining
• 47.4% of Issues Advancing, 47.8% Declining
• 44 New 52-Week Highs, 33 New Lows
• 60.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 46.9%
• Vix 11.3 +7.8%
• Total Put/Call 1.54 +40.0%
• TRIN/Arms .60 -12.1%

Friday Watch

Evening Headlines

Bloomberg:

• Asia Shares Near Record But China Investors Aren't Celebrating. MSCI Inc.’s Asian stock benchmark is just a fraction away from clearing a peak that’s stood for a decade. Chinese investors should be so lucky. Gauges of the nation’s shares in both Shanghai and Hong Kong remain more than 40 percent below their highs reached in 2007, with the bursting of 2015’s bubble adding to woes. While Chinese stocks have rallied this year, they’ve been a poor long-term bet: the Hang Seng China Enterprises Index has fallen for six of the past nine years.

• Loeb's Third Point Boosts Alibaba Stake to More Than $1 Billion. (video)

• Asia Stocks Extend Declines; Dollar Holds Loss. Asian stocks fell as Japan equities extended losses after an abrupt turnaround on Thursday that sparked the biggest one-day swing in a year. The dollar held losses. The Nikkei 225 Stock Average and the Topix index fell as the yen held gains. The indexes suddenly retreated from their highest in about 25 years on Thursday as investors positioned for the Friday settlement of some derivatives. Stocks also fell in Sydney and Seoul while other markets in the region were mixed as some calm returned after the previous day’s gyrations. U.S. stocks dropped overnight after the Senate revealed that its tax plan would delay cuts to the corporate rate until 2019. The Nikkei 225 fell 0.9 percent as of 10:47 a.m. in Tokyo. The Topix lost 0.7 percent. Australia’s S&P/ASX 200 Index fell 0.4 percent and South Korea’s Kospi index was down 0.2 percent. The Hang Seng Index in Hong Kong was down 0.2 percent, and the Shanghai Composite Index fell 0.4 percent.

• Five Things You Need to Know to Start Your Day. (video)

• How the House and Senate Tax Plans Stack Up.

• Hollywood Sexual Abuse Claims Prompt Creation of Special Task Force. The Los Angeles district attorney has created a special task force to handle the deluge of sexual abuse claims coming out of the entertainment industry. Since the New York Times last month published a story about allegations of sexual harassment and assault by movie mogul Harvey Weinstein, numerous big names in Hollywood have been accused of sexual improprieties, including actor Kevin Spacey and comedian Louis C.K.

Wall Street Journal:

• In China, Trump Employs Tough Talk, Flattery With Xi. U.S. president blames his predecessors, not Beijing, for ‘unfair’ trade relationship.

• Senate Tax Plan Differs From House on Individual Rates, Timing of Corporate Rate Cut.

• Snap’s(SNAP) Rise and Fall: How a Big, Splashy IPO Prompted the Doubters to Keep Mum. Bankers and investors in Snap’s IPO didn’t want to risk losing a piece of the potentially blockbuster deal.

• SEC Chief Fires Warning Shot Against Coin Offerings. Clayton says ICOs in many cases look like securities, suggesting companies may need to register the deals with the SEC.

• Islamic State Is Ousted From Its Last Urban Stronghold in Syria. Defeat comes after a string of losses for the militant group.

Fox News:

• CNN faces another racial discrimination lawsuit, lawyer says.

CNBC:

• Stocks making the biggest moves after hours: DIS, JWN, NVDA & more.

• Delay in corporate tax cut: ‘Fuggedaboutit,’ says strategist. (video)

• Dan Loeb's Third Point hedge fund bets even bigger on global growth.

• Traders describe market's decline as a 'natural' response to tax reform snag.

• Hertz(HTZ) profit beats estimates, but warns of higher spending; shares jump.

• News Corp(NWSA) earnings: 7 cents per share vs 1 cent expected.

• Top analysts are betting on these AI growth stocks.

• Nvidia(NVDA) bounces after earnings, datacenter revenue beats. (video)

• House Republicans advance tax bill, aim to bring it to a vote next week. (video)

Zero Hedge:

• Senate GOP Unveils Tax Proposal: Here Are The Main Highlights.

• EPA Just Approved The Release Of 'Weaponized' Mosquitoes In 20 US States.

• Perpetual Notes - China's New Way To Hide Debt (Call It Equity).

• Three Americans Now Own More Wealth Than Bottom Half of US Combined: Report.

• Russia Warns It Will Retaliate Against American Media Next Week.

• Blame Game Over Obamacare's 2018 Premium Surge Reaches Feverish Pitch, Will It Matter In 2018?

• NYC Rents Fall For First Time In 20 Months As New Development Prices Collapse.

• Disney(DIS) Slides On Earnings Miss, Declining ESPN Revenue And Viewership, Layoffs.

• Venezuela Just 24 Hours Away From Formal Declaration Of Default.

• Tax Tantrum Sparks Stock Slump As Credit Crash Continues. (graph)

Business Insider: 

• Goldman Sachs(GS) wants to become the Google of Wall Street — and it's taking a recruiting tip from the tech giant.

Night Trading 

• Asian equity indices are -.5% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 79.50 +1.5 basis points. 

• Asia Pacific Sovereign CDS Index 16.0 +.25 basis point.

• Bloomberg Emerging Markets Currency Index 72.49 -.01%.

• S&P 500 futures -.08%.

• NASDAQ 100 futures -.07%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (MT)/.72

• (JCP)/-.43

Economic Releases 

10:00 am EST

• Preliminary Univ. of Mich. Consumer Sentiment for November is estimated to rise to 100.9 versus 100.7 in October.

Upcoming Splits

• None of note

Other Potential Market Movers

• The China Money Supply report and the (GWW) analyst meeting could also impact trading today.

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

Stocks Lower into Final Hour on Diminishing Tax Reform Hopes, Yen Strength, Profit-Taking, Tech/Metals & Mining Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Heavy

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 10.7 +9.6%

• Euro/Yen Carry Return Index 137.44 -.15%

• Emerging Markets Currency Volatility(VXY) 8.13 +.12%

• S&P 500 Implied Correlation 17.53 +7.7%

• ISE Sentiment Index 530 -32.0%
  

• Total Put/Call 1.1 +12.2%

• NYSE Arms .64 -34.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 55.88 +2.16%
  

• America Energy Sector High-Yield CDS Index 365.0 +2.13%

• European Financial Sector CDS Index 52.0 +.35%

• Western Europe Sovereign Debt CDS Index 4.06 +1.5%

• Asia Pacific Sovereign Debt CDS Index 16.07 +2.32%

• Emerging Market CDS Index 191.46 +1.40%
  

• iBoxx Offshore RMB China Corporate High Yield Index 145.20 +.01%

• 2-Year Swap Spread 20.25 +.75 basis point

• TED Spread 18.5 +.25 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -44.75 +1.5 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 72.49 +.07%
• 3-Month T-Bill Yield 1.23% +1.0 basis point
  

• Yield Curve 69.5 +1.0 basis point

• China Import Iron Ore Spot $62.32/Metric Tonne +.1%

• Citi US Economic Surprise Index 40.0 -1.3 points

• Citi Eurozone Economic Surprise Index 61.40 +1.0 basis point

• Citi Emerging Markets Economic Surprise Index 14.90 -1.0 point

• 10-Year TIPS Spread 1.90 +1.0 basis point
  
• 100.0% chance of Fed rate hike at Jan. 31 meeting, 100.0% chance at March 21 meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -283 open in Japan 
• China A50 Futures: Indicating -13 open in China

• DAX Futures: Indicating -29 open in Germany

Portfolio: 

• Lower: On losses in my tech/biotech sector longs

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 75% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Growth -.9%

Sector Underperformers:

• 1) Semis -2.4% 2) Steel -2.3% 3) Networking -2.2%

Stocks Falling on Unusual Volume: 

• JRVR, VSTO, AMBC, PEGA, PAAS, SRCL, BRKS, TSRO, BEDU, CHEF, ALRM, INCR, TPIC, CRL, TWLO, SPTN, CSOD, SOHU, JCI, PEGA and FGEN

Stocks With Unusual Put Option Activity:

• 1) ROKU 2) SFM 3) TWX 4) CHTR 5) COG

Stocks With Most Negative News Mentions:

• 1) LAUR 2) INFN 3) MEET 4) PFSW 5) EGLT

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume