Bull Radar

Style Outperformer:

• Mid-Cap Growth +.8%

Sector Outperformers:

• 1) Internet +2.1% 2) Disk Drives +1.7% 3) Gaming +1.6%

Stocks Rising on Unusual Volume:

• TORC, VRAY, IRBT, REG, NVRO, NITE, ATTU, BABY, CTLT, GRUB, VICR, HA, CBD, SEED, COOL, ASML, YEXT, USNA, TER, ASTE, MDSO, HNI, EEFT, CSL, ACIU, KN, HCA, GLW, FLIR, WM, CSL, RHI, IEX, THC, CSGP, TDOC, WCN, HCLP, ROK, SSTK, TSS, WSC, CHFC and R

Stocks With Unusual Call Option Activity:

• 1) IRBT 2) GLW 3) CCK 4) GRUB 5) THO

Stocks With Most Positive News Mentions:

• 1) TORC 2) IRBT 3) HCA 4) UPS 5) CSGP

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +6.9% Above 100-Day Average
• 6 Sectors Rising, 5 Sectors Declining
• 49.3% of Issues Advancing, 46.8% Declining
• 53 New 52-Week Highs, 46 New Lows
• 50.1% of Issues Above 200-day Moving Average
• Average 14-Day RSI 47.7%
• Vix 12.5 +.6%
• Total Put/Call 1.16 +27.5%
• TRIN/Arms 1.25 +76.8%

Wednesday Watch

Evening Headlines

Bloomberg:    

• China’s Markets Embrace Risk as Traders Bet Big on Stimulus.

• Goodbye, China Deleveraging. Onward Belt and Road?  

• Chile’s Finance Minister Downplays Copper’s Decline, Sees Prices Rebounding.

• McConnell Warns Russia While Senators Propose Tough New Sanctions.

• Asia Stocks Rise After U.S. Gains; Yen Edges Lower. Asian stocks opened higher after another bout of strong earnings results buoyed U.S. equities. Treasuries were steady, as was the dollar and the offshore yuan, while the yen slipped. Shares climbed in Japan, South Korea and Australia, with gains indicated for stock markets in China and Hong Kong. The S&P 500 Index rose for a second straight day as positive earnings news overcame traders’ anxieties about simmering trade disputes. Investor focus will be back on Chinese equities, where the Shanghai Composite ratcheted up its biggest three-day gain in more than two years amid recent policy support. Treasury yields held at 2.95 percent on the 10-year note and oil climbed on stockpile decreases. Japan’s Topix index rose 0.3 percent as of 9:03 a.m. in Tokyo. Futures on Hong Kong’s Hang Seng gained 0.9 percent. Australia’s S&P/ASX 200 Index climbed 0.2 percent. South Korea’s Kospi index rose 0.2 percent. Futures on the S&P 500 Index slipped 0.1 percent.  

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

Wall Street Journal:

• U.S. Sets $12 Billion in Farm Aid to Ease Trade-Fight Impact.

• Ivanka Trump Closing Her Namesake Fashion Brand.

• Chinese Pull Back on U.S. Real Estate Buying Spree That Had Helped Prices.

• Texas Instruments Forecasts Strong Third Quarter.

• Lululemon Names Sephora Executive as New CEO.

• Emerging-Market Bonds Rebound, But Funds Are Wary.

• Insurers Pull Back From Hedge Funds.

• House Votes to Repeal Tax on Medical Devices.

MarketWatch.com:

• With the $1 trillion barrier in sight, this surprising tech stock is the best buy.

Fox News:

• Liberal Ninth Circuit Court backs right to carry firearms in public spaces.

CNBC:    

• Southern California home sales crash, a warning sign to the nation.  

• Alphabet may become the Berkshire Hathaway of the internet age on its massive technology bets  

• iRobot jumps 20% after earnings beat. 
  

• After-hours buzz: IRBT, T & more. 

• Charts suggest S&P 500 could make new all-time highs by the end of earnings season.

Zero Hedge:   

• CNN Leaks Confidential Trump-Cohen Recording.

• Q2 Earnings Season Is Off To A Good Start, But...

• Explosion In Sex Dolls Threatens Japanese Race With "Extinction".

• Trump Calls For EU To Drop All Trade Barriers Ahead Of Juncker Visit.

• Mike Krieger Asks "Are Establishment Democrats Trying to Lose?".

• Elon Musk Threatened to "Engage Counsel and Sue" Popular Tesla Critic.

• China Caves: The Full Details Behind Beijing's Launch Of Fiscal Easing.

• Denver Post Runs Letter Suggesting Trump's Execution.

• Tariff Backlash Could Cost Republicans The Senate.

• WTI/RBOB Extend Gains After Bigger Than Expected Crude Draw.

• US Southwest Suffering Heat And Drought Not Seen Since The 1930's Dust Bowl.

• Stocks, Bonds Shrug As Bitcoin Jumps, Yuan Dumps.

Business Insider:

• Manhattan is now a buyer's market at all price points.

• A billionaire known as 'China's Elon Musk' is suspected of spying while he was a Duke student and stealing a professor's invisibility technology. 

• Google showed off another human-sounding software bot and its famed scientist insists it won't kill jobs.

Night Trading 

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 83.0 -2.75 basis points. 

• Asia Pacific Sovereign CDS Index 12.5 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 69.64 +.06%.

• FTSE 100 futures -.35%

• S&P 500 futures -.18%.

• NASDAQ 100 futures -.19%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (BA)/3.26

• (BSX)/.34

• (CHKP)/1.31

• (KO)/.60

• (GLW)/.37

• (FCAU)/.84

• (FCX)/.51

• (GD)/2.48

• (GM)/1.82

• (HCA)/2.16

• (HLT)/.70

• (IR)/1.72

• (NSC)/2.33

• (NOC)/3.84

• (OC)/1.45

• (ROK)/2.04

• (R)/1.30

• (TROW)/1.78

• (TUP)/1.12

• (UPS)/1.93

After the Close:

• (AMD)/.13

• (ABX)/.14

• (CTXS)/1.20

• (FFIV)/2.39

• (FB)/1.70

• (F)/.31

• (GILD)/1.56

• (KNX)/.57

• (LVS)/.79

• (MHK)/3.90

• (PYPL)/.56

• (QCOM)/.71

• (RJF)/1.72

• (V)/1.09

• (XLNX)/.74

Economic Releases 
10:00 am EST

• New Home Sales for June are estimated to fall to 668K versus 689K in May.

10:30 am EST

• Bloomberg Consensus estimates call for a weekly crude oil inventory decline of -2,234,080 barrels versus a +5,836,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -1,207,000 barrels versus a -3,165,000 barrel decline the prior week. Distillate inventories are estimated to rise by +403,710 barrels versus a -371,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise +.93% versus a -2.4% decline the prior week.

Upcoming Splits

• None of note

Other Potential Market Movers

• The EU visiting US to discuss tariffs, Australia Consumer Confidence report, $36B 5Y T-Note auction and the weekly MBA Mortgage Applications report could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by technology 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 Higher into Final Hour on Positive Earnings Outlooks, Diminishing Trade War Fears, Oil Gain, Commodity/Pharma Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 12.8 +1.7%

• Euro/Yen Carry Return Index 135.21 -.24%

• Emerging Markets Currency Volatility(VXY) 10.13 +.5%

• S&P 500 Implied Correlation 30.55 +7.34%

• ISE Sentiment Index 77.0 -44.6%
  

• Total Put/Call .88 +6.64%

• NYSE Arms .69 -16.1%

Credit Investor Angst:

• North American Investment Grade CDS Index 60.86 -1.15%
  

• America Energy Sector High-Yield CDS Index 376.0 -.70%

• European Financial Sector CDS Index 77.17 -3.69%

• Italian/German 10Y Yld Spread 229.0 +5.75 basis points
  

• Asia Pacific Sovereign Debt CDS Index 12.45 -1.74%

• Emerging Market CDS Index 173.60 +1.38%
  

• iBoxx Offshore RMB China Corporate High Yield Index 148.67 +.75%

• 2-Year Swap Spread 21.50 -.5 basis point

• TED Spread 35.0 -3.0 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -4.25 -.5 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 69.58 -.06%
• 3-Month T-Bill Yield 1.99% +2.0 basis points
  

• Yield Curve 31.5 -1.75 basis points

• China Iron Ore Spot 65.77 USD/Metric Tonne +.06%

• Citi US Economic Surprise Index -1.10 +1.2 points

• Citi Eurozone Economic Surprise Index -34.50 +.3 point

• Citi Emerging Markets Economic Surprise Index -1.40 +.3 point

• 10-Year TIPS Spread 2.12 unch.
  
• 91.4% chance of Fed rate hike at Sept. 26th meeting, 91.8% chance at November 8th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +50 open in Japan 
• China A50 Futures: Indicating +144 open in China

• DAX Futures: Indicating -22 open in Germany

Portfolio: 

• Slightly Lower: On losses in my retail sector longs and emerging market shorts

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

• Market Exposure: Moved to 75% Net Long

Morning Market Internals

NYSE Composite Index:

• Volume Running +5.8% Above 100-Day Average
• 9 Sectors Rising, 3 Sectors Declining
• 59.6% of Issues Advancing, 36.3% Declining
• 75 New 52-Week Highs, 12 New Lows
• 50.1% of Issues Above 200-day Moving Average
• Average 14-Day RSI 47.7%
• Vix 12.1 -4.1%
• Total Put/Call .73 -9.9%
• TRIN/Arms .63 -23.5%