Morning Market Internals

NYSE Composite Index:

• Volume Running -.9% Below 100-Day Average
• 5 Sectors Rising, 6 Sectors Declining
• 30.8% of Issues Advancing, 65.6% Declining
• 8 New 52-Week Highs, 56 New Lows
• 42.0% of Issues Above 200-day Moving Average
• Average 14-Day RSI 47.5%
• Vix 16.0 +.3%
• Total Put/Call .91 +1.1%
• TRIN/Arms 1.0 -31.9%

Tuesday Watch

Night Trading 

• Asian equity indices are unch. to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 73.25 -1.75 basis points. 
• Asia Pacific Sovereign CDS Index 12.0 -.5 basis point
• Bloomberg Emerging Markets Currency Index 73.28 unch.
• FTSE 100 futures -.15%.
• S&P 500 futures +.15%.
• NASDAQ 100 futures +.13%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (AET)/3.01
• (AGCO)/.12
• (ADM)/.52
• (AN)/1.00
• (BP)/.11
• (EAT)/1.03
• (CMI)/2.94
• (DISH)/.69
• (EMR)/.72
• (FDP)/.91
• (HBI)/.24
• (HCA)/2.07
• (JCI)/.52
• (LLL)/2.01
• (LL)/-.04
• (MLM)/.37
• (MRK)/1.00
• (PFE)/.74
• (RDC)/-.80
• (SMG)/3.31
• (STX)/1.33
• (UAA)/-.05
• (ALL)/2.60
• (APC)/.41
• (AAPL)/2.68
• (CHRW)/1.00
• (COHR)/3.49
• (CXO)/.77
• (GILD)/1.67
• (JNPR)/.25
• (MDLZ)/.61
• (NBR)/-.29
• (TRUP)/-.04
• (ZEN)/-.03

Economic Releases

10:00 am EST

• Construction Spending MoM for March is estimated to rise +.5% versus a +.1% gain in February. 
• ISM Manufacturing for April is estimated to fall to 58.4 versus 59.3 in March.
• ISM Prices Paid for April is estimated to rise to 78.5 versus 78.1 in March.
  

Afternoon: 

• Wards Total Vehicle Sales for April is estimated to fall to 17.1M versus 17.4M in March.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Australia Central Bank decision, weekly US retail sales reports, (CE) investor day and the Steel/Aluminum tariff exclusions for certain countries expiring could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by consumer 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 50% net long heading into the day.

Stocks Reversing Lower into Final Hour on Geopolitical Fears, Earnings Outlook Worries, Emerging Markets Debt Angst, Telecom/Homebuilding Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 15.7 +2.1%

• Euro/Yen Carry Return Index 137.45 -.21%

• Emerging Markets Currency Volatility(VXY) 8.30 -.12%

• S&P 500 Implied Correlation 42.81 +.59%

• ISE Sentiment Index 80.0 -8.05%
  

• Total Put/Call .88 +1.15%

• NYSE Arms 1.12 +1.87%

Credit Investor Angst:

• North American Investment Grade CDS Index 60.76 +1.11%
  

• America Energy Sector High-Yield CDS Index 399.0 -1.40%

• European Financial Sector CDS Index 57.0 +.97%

• Italian/German 10Y Yld Spread 122.50 +5.5 basis points
  

• Asia Pacific Sovereign Debt CDS Index 12.04 +.84%

• Emerging Market CDS Index 142.39 +1.29%
  

• iBoxx Offshore RMB China Corporate High Yield Index 149.39 -.03%

• 2-Year Swap Spread 25.75 +.75 basis point

• TED Spread 55.0 -.25 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -10.5 -1.5 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 73.28 -.42%
• 3-Month T-Bill Yield 1.8% -1.0 basis point
  

• Yield Curve 45.5 -2.5 basis points

• China Iron Ore Spot 65.63 USD/Metric Tonne unch.

• Citi US Economic Surprise Index 41.8 -4.2 points

• Citi Eurozone Economic Surprise Index -77.50 +5.9 points

• Citi Emerging Markets Economic Surprise Index 3.2 -5.5 points

• 10-Year TIPS Spread 2.18 +1.0 basis point
  
• 92.7% chance of Fed rate hike at June 13 meeting, 93.2% chance at August 1 meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +11  open in Japan 
• China A50 Futures: Indicating +90 open in China

• DAX Futures: Indicating -42 open in Germany

Portfolio: 

• Slightly Lower: On losses in my retail/medical/biotech/industrial sector longs

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

• Market Exposure: Moved to 50% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Value -.2%

Sector Underperformers:

• 1) Telecom -1.8% 2) Homebuilders -1.7% 3) Biotech -1.2%

Stocks Falling on Unusual Volume: 

• VAC, ANDX, MPC, ARNC, TMUS, CTB, KPTI, FSLR, INT and MCY

Stocks With Unusual Put Option Activity:

• 1) ADM 2) TMUS 3) ANDV 4) MPC 5) DISH

Stocks With Most Negative News Mentions:

• 1) W 2) GSUM 3) CL 4) CTV 5) OC

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +.2%

Sector Outperformers:

• 1) Coal +3.7% 2) Restaurants +1.5% 3) Gaming +.8%

Stocks Rising on Unusual Volume:

• FNGN, CHEK, DCT, ANDV, ILG, BWP, FDC, MCD, DOVA, CHTR, WPP, USCR, AKAO, IMMU, AQ, FCN, EQGP, CIFS, NSP, TRNO, FR, KMPR, CHGG, ANIK and WUBA

Stocks With Unusual Call Option Activity:

• 1) FDC 2) ILG 3) CPB 4) HBI 5) P

Stocks With Most Positive News Mentions:

• 1) MCD 2) NYT 3) FIT 4) EVIO 5) EPD

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -1.0% Below 100-Day Average
• 9 Sectors Rising, 2 Sectors Declining
• 56.3% of Issues Advancing, 40.0% Declining
• 46 New 52-Week Highs, 21 New Lows
• 43.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.0%
• Vix 15.4 -.4%
• Total Put/Call .90 +3.5%
• TRIN/Arms .97 -.11%