Bull Radar

Style Outperformer:

• Large-Cap Growth +.2%

Sector Outperformers:

• 1) Robotics +.9% 2) Shipping +.7% 3) Airlines +.7%

Stocks Rising on Unusual Volume:

• DDD, BNCL, WCG, MTCH, WK, ALRM, AAOI, CYBR, HDP, CARG, VSI, SKY, ENDP, MIDD, ANDE, SSYS, ZG, PRMW, BOOT, INGN, CSOD, ALB, ONCE, KORS, CSTE, RARX, TPC, ICHR, IAC, PAA, GTN and PAGP

Stocks With Unusual Call Option Activity:

• 1) AMLP 2) JCP 3) AXL 4) TDOC 5) AAOI

Stocks With Most Positive News Mentions:

• 1) DDD 2) ENDP 3) VSI 4) ETM 5) MTCH

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -6.6% Below 100-Day Average
• 4 Sectors Rising, 7 Sectors Declining
• 38.5% of Issues Advancing, 57.8% Declining
• 56 New 52-Week Highs, 27 New Lows
• 54.1% of Issues Above 200-day Moving Average
• Average 14-Day RSI 50.1%
• Vix 11.1 +1.7%
• Total Put/Call 1.0 +13.0%
• TRIN/Arms .90 -11.2%

Wednesday Watch

Evening Headlines

Bloomberg:  

• China's Investors Are Being Offered the Cheapest Money in Years.    

• China Is Asking Banks to Avoid Yuan Market ‘Herd Behavior’.

• Stocks Give Trump a $1.3 Trillion Reason to Escalate the Trade War.

• SoftBank in Talks to Invest Up to $750 Million in Zume, the Startup That Sells Robot-Made Pizza.

• Yuan Holds Gains; Asia Stocks Set for Mixed Start. China’s yuan held on to gains triggered by further moves to stabilize the currency and U.S. stocks approached a fresh all-time high. Asian equities looked set for a mixed start to Wednesday trading. Futures pointed to gains for equities in Hong Kong and China, while Japan and Australian shares faced a muted open. The S&P 500 Index closed at the highest level since its Jan. 26 peak. A rise in emerging-market equities overshadowed rising woes in Turkey, where the yield on the country’s 10-year bonds touched a record high amid a diplomatic spat with the U.S. Futures on Japan’s Nikkei 225 were little changed in Singapore. Futures on the FTSE China A50 Index rose 0.3 percent. Futures on Hong Kong’s Hang Seng advanced 0.5 percent. Futures on Australia’s S&P/ASX 200 Index were little changed.

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

• Credit Suisse's Palfrey Says Economic Strength to Bolster Stocks in 2nd Half.  

• Investor Appetite for Hedge Funds Is Soaring—But Define ‘Hedge Fund’.

Wall Street Journal:

• Is Liberal Racism a Horse of a Different Color? 

• Jobs Go Unfilled as the Economy Expands.

• American Refiners Reap Big Profits as Production Soars.

• Trump’s Tariffs Turn Small Businesses Upside Down.

• Trump Ex-Lawyer Cohen Is Under Investigation for Alleged Tax Fraud.

• Funds Avoid Pain in Big Tech Stocks.

MarketWatch.com:

• Charting a bullish technical tilt: S&P 500, Nasdaq rise within view of record territory.

Fox News:

• These are the races to watch today as Americans head to the polls.

• Rick Gates admits extramarital affair as Manafort defense tears into double life.

CNBC:   

• Tesla shares surge 10% after Elon Musk shocks market with tweet about going private.  

• Cramer says index fund buying and buybacks are creating a 'stock shortage'.

• After-hours buzz: SNAP, PZZA & more. 

• Elon Musk’s tweet about going private costs Tesla short sellers $1.3 billion.  

• It's 'inevitable' that esports will be part of the Olympics, Logitech CEO says.

Zero Hedge:  

• Senate Democrats Are Circulating Plans For Government Takeover Of The Internet.

• Not The Driver? Feinstein's Chinese Spy May Have Been Office Director

• EU Threatens European Firms That Comply With Trump's Iran Sanctions.

• Trump To Slap $16 Billion In New Tariffs On Chinese Imports Starting August 23.

• Prince Alwaleed Buys A 2.3% SNAP Stake, As Snapchat Users Shrink For The First Time Ever.

• A Four Person NATO-Funded Team Advises Facebook(FB) On Flagging "Propaganda".

• US Credit Card Debt Shrinks For Only Second Time Since 2013 As Student, Auto Loans Hit All Time High.

• The Crackdown Continues: Twitter Suspends Libertarian Accounts, Including Ron Paul Institute Director.

• WTI Dips As Big Product Build Offsets Crude Inventory Draw.

• Cryptos Tumble As SEC Delays Another Bitcoin ETF Decision.

• Global Stocks Pop, Bonds Drop As PBOC Slows Great Fall Of China.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 79.75 -1.75 basis points. 

• Asia Pacific Sovereign CDS Index 10.0 -.75 basis point.

• Bloomberg Emerging Markets Currency Index 69.27 -.04%.

• FTSE 100 futures -.02%

• S&P 500 futures +.03%.

• NASDAQ 100 futures +.01%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (CVS)/1.61

• (DLPH)/1.24

• (JLL)/2.22

• (LITE)/.65

• (MGA)/1.74

• (MYL)/1.22

• (SINA)/.72

• (WB)/.66

• (WWW)/.46

After the Close:

• (CVNA)/-.34

• (IAC)/1.53

• (JACK)/.88

• (MNST)/.47

• (NTES)/2.72

• (NKTR)/5.29

• (YELP)/.28

Economic Releases 
10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -2,164,000 barrels versus a +3,803,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -1,796,920 barrels versus a -2,536,000 barrel decline the prior week. Distillate inventories are estimated to rise by +731,000 barrels versus a +2,983,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.13% versus a +2.3% gain prior.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Barkin speaking, China Trade Data report, Japan Machine Orders report, $26B 10Y T-Note auction, weekly MBA Mortgage Applications report, Canaccord Growth Conference, (COST) monthly sales report, (ZUMZ) sales/guidance update and the (FRPT) investor day could also impact trading today.

BOTTOM LINE:  Asian indices are modestly higher, boosted by technology 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 Rising into Final Hour on Economic Optimism, Earnings Outlooks, Short-Covering, Biotech/Homebuilding Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 11.0 -2.6%

• Euro/Yen Carry Return Index 134.42 +.37%

• Emerging Markets Currency Volatility(VXY) 10.28 +.59%

• S&P 500 Implied Correlation 28.33 -4.6%

• ISE Sentiment Index 95.0 -5.9%
  

• Total Put/Call .89 unch.

• NYSE Arms .93 -19.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 57.98 -1.32%
  

• America Energy Sector High-Yield CDS Index 359.0 -.50%

• European Financial Sector CDS Index 76.74 -3.18%

• Italian/German 10Y Yld Spread 246.0 -5.5 basis points
  

• Asia Pacific Sovereign Debt CDS Index 10.10 -6.14%

• Emerging Market CDS Index 173.10 +.60%
  

• iBoxx Offshore RMB China Corporate High Yield Index 150.30 -.07%

• 2-Year Swap Spread 20.75 -.75 basis point

• TED Spread 30.25 -3.5 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -6.75 -1.0 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 69.21 +.34%
• 3-Month T-Bill Yield 2.04% +3.0 basis points

• Yield Curve 30.25 +1.5 basis points

• China Iron Ore Spot 69.77 USD/Metric Tonne +.24%

• Citi US Economic Surprise Index -13.0 +.9 point

• Citi Eurozone Economic Surprise Index -35.70 -.4 point

• Citi Emerging Markets Economic Surprise Index -2.80 -.3 point

• 10-Year TIPS Spread 2.13 +1.0 basis point
  
• 92.5% chance of Fed rate hike at Nov. 8th meeting, 97.8% chance at Dec. 19th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +33 open in Japan 
• China A50 Futures: Indicating +89 open in China

• DAX Futures: Indicating +7 open in Germany

Portfolio: 

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

• Disclosed Trades: None

• Market Exposure: 100% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Value +.3%

Sector Underperformers:

• 1) Gold & Silver -.7% 2) Foods -.4% 3) Utilities -.3%

Stocks Falling on Unusual Volume: 

• TPVG, ONCE, Z, MAXR, XRAY, OMI, WTW, LMNX, PTGX, QNST, GTT, XOG, GSKY, ATSG, EXPD, DPLO, BRKS, CRZO, THC and XRAY

Stocks With Unusual Put Option Activity:

• 1) FTR 2) Z 3) WTW 4) THC 5) DBD

Stocks With Most Negative News Mentions:

• 1) ZG 2) XOG 3) PDCE 4) AVDL 5) NWL

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.5%

Sector Outperformers:

• 1) Homebuildng +1.6% 2) Steel +1.6% 3) Alt Energy +1.5%

Stocks Rising on Unusual Volume:

• PDD, HTZ, TWLO, SKY, FIVN, ETSY, MNK, HEAR, AIN, ARMK, AKCA, SODA, FSS, FRPT, VREX, VCEL, ZBRA, USCR, LFVN, LGND, REGI, GAIA, SEAS, IIVI, TCMD, BR, RPD, ATKR, LGIH, TAST, BLD, TSLA, SATS, RESI, CDEV, OAS, ITRI, LPX and LITE

Stocks With Unusual Call Option Activity:

• 1) Z 2) HTZ 3) CAR 4) ESRX 5) EMR

Stocks With Most Positive News Mentions:

• 1) TWLO 2) OD 3) BMRN 4) MNK 5) RNG

Charts:

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