Morning Market Internals

NYSE Composite Index:

• Volume Running +18.7% Above 100-Day Average
• 8 Sectors Rising, 3 Sectors Declining
• 63.2% of Issues Advancing, 32.7% Declining
• 31 New 52-Week Highs, 41 New Lows
• 41.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 46.9%
• Vix 17.5 -2.2%
• Total Put/Call .83 -13.5%
• TRIN/Arms 1.18 +51.8%

Thursday Watch

Evening Headlines

Bloomberg:    

• Macron Says He Thinks Trump Will Pull Out of Iran Nuclear Deal.   

• The Euro May Fly Below the Yen as Central Bankers Meet.  

• Investors Want to Know Whether Draghi Is Worried About Economic Momentum.  

• South Korea Economy Rebounds in 1st Quarter After Contraction.

• Asian Stocks Climb as Tech Rises; Dollar Steadies. South Korean shares led gains across the region after earnings at Samsung Electronics Co. topped estimates on booming exports of memory chips. Better-than-expected sales at Facebook Inc. lifted its shares in after-hours trading and gave a boost to U.S. stock futures. The euro edged higher ahead of Thursday’s European Central Bank rate decision. The 10-year U.S. Treasury yield dipped to 3.02 percent. The MSCI Asia Pacific Index advanced 0.3 percent as of 10:20 a.m. in Tokyo. Japan’s Topix index gained 0.2 percent. Futures on the S&P 500 Index added 0.3 percent after the cash market shut 0.2 percent higher on Wednesday. Nasdaq 100 futures rose 0.8 percent. Australia’s S&P/ASX 200 Index gained 0.2 percent and Taiwan’s Taiex added 0.6 percent. Kospi index climbs 1 percent. Hong Kong’s Hang Seng advanced 0.2 percent. 

• Five Things You Need to Know to Start Your Day.

Wall Street Journal:

• Sonos Prepares for IPO as Soon as June.

• NBC Bet $69 Million on Megyn Kelly—Then Viewers Vanished.

• Trump Lawyers Seek to Determine Whether Mueller Has ‘Open Mind’ .

• Comcast Sets Up Battle With Fox. 

• Samsung’s Earnings Hot Streak Continues.

• How Popular Is ‘Fortnite?’ Headset Sales Nearly Doubled in March.

• Migrants Gather in Mexico, Prepare to Seek U.S. Asylum.

Fox News:

• 'Adversaries' jamming US Air Force gunships in Syria, Special Ops general reveals.

CNBC: 

• Chipotle(CMG) shares jump 10% as menu price hikes fuel earnings beat.

• Ford(F) reports first-quarter earnings top estimates, plans to drop some slow-selling sedans.

• Qualcomm(QCOM) gains on earnings beat.

• The US dollar is breaking out this week, boosted by trade talks and higher rates. 

• After-hours buzz: FB, T, CMG & more.

• Visa(V) gains 2% after earnings beat.

• AMD(AMD) stock jumps after chipmaker's earnings top estimates.

Zero Hedge: 

• Kanye Fires Manager, Tweets His Way Through "Meltdown" As Trump Thanks For "Dragon Energy" Tweet.

• The Great Exodus From America's 'Blue' Cities Accelerates.

• Trader: The US Has A "Grotesque" Debt Problem.

• Facebook(FB) Surges After Blowout Earnings, Buyback Boost: "Nothing That Was Feared, Happened"

• How Far Down The Big Data/'Psychographic Micro-Targeting' Rabbit Hole Do You Want To Go?

• North Korean Nuclear Test Site Has Collapsed, Explaining Kim's "Suspension" Of Further Tests.

• Boeing Bounce Saves Stocks But Bond Bloodbath Continues .

Business Insider:

• Ratings agency Moody's affirms US' top-notch credit rating.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 76.25 -.75 basis point. 

• Asia Pacific Sovereign CDS Index 12.75+.75 basis point

• Bloomberg Emerging Markets Currency Index 73.42 +.01%.

• FTSE 100 futures +.29%.

• S&P 500 futures +.26%.

• NASDAQ 100 futures +.69%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (AAN)/.93

• (ABBV)/1.79

• (AB)/.66

• (MO)/.91

• (AAL)/.71

• (BAX)/.62

• (BLMN)/.58

• (BMY)/.85

• (BC)/.94

• (COP)/.74

• (DPZ)/1.77

• (DHI)/.86

• (FCAU)/.70

• (GM)/1.27

• (HLT)/.51

• (ITW)/1.86

• (IP)/.89

• (LEA)/4.91

• (MGM)/.30

• (NEM)/.33

• (PEP)/.93

• (RCL)/.97

• (LUV)/.74

• (TWX)/1.74

• (TSCO)/.57

• (UPS)/1.54

• (VLO)/.93

• (VC)/1.79

• (ZBH)/1.89

• (AMZN)/1.22

• (BIDU)/1.71

• (FSLR)/-.09

• (INTC)/.72

• (KLAC)/1.99

• (MSFT)/.85

• (MHK)/3.00

• (SBUX)/.53

• (X)/.30

• (WDC)/3.31

Economic Releases

8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 230K versus 232K the prior week.

• Continuing Claims are estimated to fall to 1850K versus 1863K prior.

• Preliminary Wholesale Inventories MoM for March are estimated to rise +.7% versus a +1.0% gain in February.

• Preliminary Durable Goods Orders for March are estimated to rise +1.6% versus a +3.0% gain in February.

• Preliminary Durables Ex Transports for March are estimated to rise +.5% versus a +1.0% gain in February.

• Preliminary Cap Goods Orders Non-Defense Ex-Air for March are estimated to rise +.5% versus a +1.4% gain in February.
  

11:00 am EST

• The Kansas City Fed Manufacturing Activity Index for April is estimated at 17.0 versus 17.0 in March.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The ECB rate decision, ECB press conference, Japan Industrial Production/CPI reports, weekly Bloomberg Consumer Comfort Index and the $29B 7Y T-Note auction could also impact trading today.

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

Stocks Reversing Slightly Higher into Final Hour on Technical Buying, Earnings Optimism, Yen Weakness, Energy/Road & Rail Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 18.5 +2.9%

• Euro/Yen Carry Return Index 138.63 +.02%

• Emerging Markets Currency Volatility(VXY) 8.67 +2.9%

• S&P 500 Implied Correlation 42.0 -.6%

• ISE Sentiment Index 89.0 +8.5%
  

• Total Put/Call .96 -6.8%

• NYSE Arms .91 -.4%

Credit Investor Angst:

• North American Investment Grade CDS Index 62.56 +.79%
  

• America Energy Sector High-Yield CDS Index 414.0 -.09%

• European Financial Sector CDS Index 57.43 +.87%

• Italian/German 10Y Yld Spread 114.25 +.75 basis point
  

• Asia Pacific Sovereign Debt CDS Index 12.69 +5.3%

• Emerging Market CDS Index 143.66 +1.14%
  

• iBoxx Offshore RMB China Corporate High Yield Index 149.24 -.06%

• 2-Year Swap Spread 27.25 +.25 basis point

• TED Spread 51.0 +.75 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -7.75 +.25 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 73.38 -.6%
• 3-Month T-Bill Yield 1.85% +1.0 basis point
  

• Yield Curve 54.0 +1.5 basis points

• China Iron Ore Spot 66.72 USD/Metric Tonne -.40%

• Citi US Economic Surprise Index 41.70 -.1 point

• Citi Eurozone Economic Surprise Index -84.60 +1.2 points

• Citi Emerging Markets Economic Surprise Index 8.7 +.3 point

• 10-Year TIPS Spread 2.18 +1.0 basis point
  
• 92.0% chance of Fed rate hike at June 13 meeting, 92.5% chance at August 1 meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +60  open in Japan 
• China A50 Futures: Indicating unch. open in China

• DAX Futures: Indicating +18 open in Germany

Portfolio: 

• Higher: On gains in my tech/industrial/retail sector longs and emerging market shorts

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

• Market Exposure: Moved to 50% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Growth -.1%

Sector Underperformers:

• 1) Gaming -2.2% 2) Social Media -1.5% 3) Robotics -1.0%

Stocks Falling on Unusual Volume: 

• MRCY, CHEK, TER, HF, BEDU, CHKP, OC, TWTR, DLB, SAIL, SOHU, COF, RES, NYCB, IPHI and SNAP

Stocks With Unusual Put Option Activity:

• 1) HRB 2) TRIP 3) OCLR 4) ANDV 5) SHPG

Stocks With Most Negative News Mentions:

• 1) IPHI 2) LITE 3) LC 4) MRCY 5) NPTN

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth unch.

Sector Outperformers:

• 1) Road & Rail +1.5% 2) Oil Service +1.5% 3) Homebuilders +1.4%

Stocks Rising on Unusual Volume:

• VICR, ANTX, CBI, USNA, SIX, LRN, MAS, RHI, IART, WWE, ROK, CSL, CVE, CIT, NSC, SVU, SLGN, STM, TRCO, ABMD, CR, CVNA, IR, TUP, TXN, CRAY and GRA

Stocks With Unusual Call Option Activity:

• 1) JCI 2) IP 3) MDR 4) PCAR 5) HOG

Stocks With Most Positive News Mentions:

• 1) TUP 2) TXN 3) LH 4) BSX 5) BIIB

Charts:

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