Bull Radar

Style Outperformer:

• Large-Cap Value +.8%

Sector Outperformers:

• 1) Oil Service +3.6% 2) Internet +2.1% 3) Road & Rail +2.1%

Stocks Rising on Unusual Volume:

• TRIP, ZAGG, KRNT, LTRPA, PRMW, TWLO, VDSI, HCC, AAXN, PPL, BMA, JAZZ, DIOD, BOOM, PEN, NAVG, NTRA, NEWR, COHU, WWW, PI, EOLS, ARGX, PVAC, CNQ, GPOR, BCOR, PI, VDSI, RGNX, MAXR, VERI, QDEL, DIOD, ICHR, ROKU, CLVS, SUPN, SBGI, CTRE, CORE, CDEV, LGND, LBRT, CDLX, OXY, EA, AMBC, USAT, FRGI, DISH, PUMP, HCC, GDDY, COOL, FRPT, XENT and IFF

Stocks With Unusual Call Option Activity:

• 1) OPK 2) LNG 3) SHLD 4) TWLO 5) KNX

Stocks With Most Positive News Mentions:

• 1) ZAGG 2) TRIP 3) AAXN 4) SHLD 5) NEWR

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +13.9% Above 100-Day Average
• 8 Sectors Rising, 3 Sectors Declining
• 49.0% of Issues Advancing, 47.4% Declining
• 114 New 52-Week Highs, 47 New Lows
• 43.8% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.3%
• Vix 14.1 -3.9%
• Total Put/Call .80 -2.4%
• TRIN/Arms .60 -36.2%

Wednesday Watch

Evening Headlines

Bloomberg:   

• Asia Stocks Set for Mixed Open; Dollar Gains: Markets Wrap. (video) Equity-index futures in Asia point to a mixed start as investors assessed the implications of President Donald Trump’s decision to scrap a nuclear deal with Iran. The dollar rose and Treasury yields pushed higher. Futures on benchmarks in Japan and Australia were little changed, fell in Hong Kong and rose in South Korea. The S&P 500 Index pared losses to close flat. West Texas crude sank as much as 4.4 percent before recovering in a volatile trading session as investors digested what the Iran move could mean for energy supplies. The greenback strengthened for a third day. Ten-year Treasury yields rose toward 3 percent after JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon warned a climb to 4 percent may be coming. Futures on Japan’s Nikkei 225 Stock Average fell less than 0.1 percent in Singapore. Australia’s S&P/ASX 500 Index futures rose less than 0.1 percent. Kospi index futures added 0.2 percent. Hong Kong Hang Seng Index futures fell 0.4 percent. The S&P 500 Index ended the trading day little changed. The MSCI Emerging Market Index rose 0.3 percent. S&P 500 futures rose 0.1 percent.  

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

• U.S. Seeks to Quickly Curb Iran Oil After Scrapping Deal.

Wall Street Journal:

• Trump Withdraws U.S. From Iran Deal.

• Trump’s Ratings Rise.

• Comcast Sets Stage for Possible Fox Bid, With Eye on Thwarting Disney.

• Primaries to Test Trump’s Sway Over Republican Voters.

• Energy Stocks Flip From Dud to Darling.

Fox News:

• What happens next for Iran nuclear deal now that Trump has said goodbye.

CNBC: 

• Stocks making the biggest moves after hours: TripAdvisor, Electronic Arts, Match Group & more.

• Tech workers are paying $7,000 to freeze their stem cells in hope of extending life.

• Here are the sanctions that will snap back into place now that the US is out of the Iran nuclear deal.

• Retail attempts another recovery, but this one looks a little different, trader says.

Zero Hedge: 

• Mass Exodus: Venezuelan Army Troops Desert In Droves Ahead Of Presidential Election.

• "The Art Of Exiting The Deal": What Happens Next?

• Seattle Is Becoming A City That Is Hostile To The Middle Class.

• The Purge Expands: Deutsche Bank Planning To Fire Up To 20% Of US Workers.

• Ron Paul: The NSA Continues To Abuse Americans By Intercepting Their Telephone Calls.

• WTI/RBOB Extend Rebound After Surprise Crude Inventory Draw.

• Stocks Unch, Oil Ends Lower, Rial Crashes After Trump Pulls Out.

Business Insider: 

• Facebook(FB) is shaking things up in a massive way and reorganizing the company into 3 core areas.

Telegraph:

• Comment: Trump may actually do some good in targeting the eurozone's destabilising trade surplus.

Night Trading 

• Asian equity indices are -.25% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 77.50 +.5 basis points. 

• Asia Pacific Sovereign CDS Index 13.0 +.5 basis point

• Bloomberg Emerging Markets Currency Index 71.79 -.10%.

• FTSE 100 futures unch.

• S&P 500 futures -.08%.

• NASDAQ 100 futures -.06%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (BUD)/.77

• (DLPH)/1.15

• (MYL)/.96

• (ODP)/.08 

• (PRTY)/.05

• (SINA)/.49

• (TM)/142.52

• (WB)/.47

• (WWW)/.37

• (FOXA)/.54

• (ALB)/1.20

• (CTRP)/.16

• (IAC)/.80

• (MBI)/.07

• (MELI)/.44

• (SNH)/.45

Economic Releases

8:30 am EST

• PPI Final Demand MoM for April is estimated to rise +.2% versus a +.3% gain in March.

• PPI Ex Food and Energy MoM for April is estimated to rise +.2% versus a +.3% gain in March.

 10:00 am EST

• Wholesale Trade Sales MoM for March.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +393,360 barrels versus a  +6,218,000 barrel gain prior. Gasoline supplies are estimated to rise by +57,900 barrels versus a +1,171,000 barrel gain prior. Distillate inventories are estimated to fall by -1,518,200 barrels versus a -3,900,000 barrel decline the prior week.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Bostic speaking, $25B 10Y T-Note auction, weekly MBA mortgage applications report, UBS Utilities/Natural Gas Conference, Jefferies Tech Conference, (COST) monthly sales report and (ZUMZ) monthly sales/updated guidance could also impact trading today.

BOTTOM LINE:  Asian indices are slightly lower, weighed down by consumer 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 day.

Stocks Lower into Final Hour on Geopolitical Tensions, Lower Oil, Profit-Taking, Utility/Telecom Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Around Even
  

• Sector Performance: Mixed
  

• Volume: Slightly Above Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 15.14 +2.6%

• Euro/Yen Carry Return Index 134.60 -.6%

• Emerging Markets Currency Volatility(VXY) 8.74 +.69%

• S&P 500 Implied Correlation 41.10 -1.2%

• ISE Sentiment Index 108.0 -5.3%
  

• Total Put/Call .81 -12.9%

• NYSE Arms .98 -10.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 62.54 +1.02%
  

• America Energy Sector High-Yield CDS Index 386.0 +.53%

• European Financial Sector CDS Index 60.96 +1.14%

• Italian/German 10Y Yld Spread 130.5 +5.25 basis points
  

• Asia Pacific Sovereign Debt CDS Index 12.95 +3.19%

• Emerging Market CDS Index 161.09 +3.2%
  

• iBoxx Offshore RMB China Corporate High Yield Index 149.42 -.17%

• 2-Year Swap Spread 25.75 -.5 basis point

• TED Spread 51.0 -2.5 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -3.5 -1.25 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 71.86 -.58%
• 3-Month T-Bill Yield 1.86% +3.0 basis points
  

• Yield Curve 45.75 -.75 basis point

• China Iron Ore Spot 66.47 USD/Metric Tonne -1.0%

• Citi US Economic Surprise Index 28.2 -2.7 points

• Citi Eurozone Economic Surprise Index -98.90 -2.3 points

• Citi Emerging Markets Economic Surprise Index 1.2 +2.0 points

• 10-Year TIPS Spread 2.16 unch.
  
• 100.0% chance of Fed rate hike at August 1 meeting, 100.0% chance at September 26 meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -38  open in Japan 
• China A50 Futures: Indicating -16 open in China

• DAX Futures: Indicating -3 open in Germany

Portfolio: 

• Slightly Higher: On gains in my industrial/tech sector longs

• Disclosed Trades: None

• Market Exposure: 100% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Value -.1%

Sector Underperformers:

• 1) Utilities -2.3% 2) Telecom -1.6% 3) Homebuilders -1.0%

Stocks Falling on Unusual Volume: 

• NVRO, BMA, CWH, HTZ, HAIN, COHU, AKCA, HCC, IONS, BFR, LOMA, CEPU, ASMB, MOS, RMBS, APLS, PETS, AQUA, DPLO, FOLD, LGIH, DISH and SGMO

Stocks With Unusual Put Option Activity:

• 1) CTL 2) TAHO 3) OCLR 4) GOGO 5) HTZ

Stocks With Most Negative News Mentions:

• 1) NVRO 2) IONS 3) DISH 4) GPP 5) AKCA

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +.3%

Sector Outperformers:

• 1) Construction +1.9% 2) Oil Service +1.2% 3) Road & Rail +1.1%

Stocks Rising on Unusual Volume:

• USAT, PI, FRGI, VRX, IIN, TREX, HUD, SCPH, TCMD, RGEN, CARB, NAVG, RKDA, ODFL, ZBRA, MWA, IMOS, SEAS, TAST, CENT, CDLX, EXPD, ANDX, NGHC, CRCM, BMCH, USAT, MYGN, CRZO, AMED, LMNX, ATSG, HRTG, CROX, MDB, VCEL, ARMK, SHAK, COOL, ATHN and HAE

Stocks With Unusual Call Option Activity:

• 1) FOLD 2) HAIN 3) AVEO 4) PVH 5) GLW

Stocks With Most Positive News Mentions:

• 1) PI 2) FRGI 3) TREX 4) ZBRA 5) EXPD

Charts:

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