Bear Radar

Style Underperformer:

• Large-Cap Value -.5%

Sector Underperformers:

• 1) Steel -2.2% 2) Semis -2.2% 3) Agriculture -1.4%

Stocks Falling on Unusual Volume: 

• TUR, IEFA, MCHP, RDFN, PBYIK, VSAT, DBX, PTLA, RUN, BFR, WTTR, CORT, FSCT, OMER, Z, RLGY, PBF, PRTY, SYNA, JCOM, DBX and NWSA

Stocks With Unusual Put Option Activity:

• 1) TRCO 2) PLNT 3) HIG 4) TUR 5) OSTK

Stocks With Most Negative News Mentions:

• 1) ELGX 2) ASYS 3) RDFN 4) PTLA 5) BHF

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +.5%

Sector Outperformers:

• 1) Retail +.8% 2) Oil Service +.7% 3) Healthcare Providers +.2%

Stocks Rising on Unusual Volume:

• TTD, OSTK, AGS, SA, TRUE, YELP, RUTH, OLED, BEL, ANGI, PLNT, WOW, ICLR, RBA, ROKU, IMKTA, WSFS, HDP, DDD, EPAY, ICUI, ESRX, SPPI, PCTY, OLED, IONS, ACAD, APPN, APPN, MPAA, IAC, ELF, ALTR,  JAG, TTGT and AQUA

Stocks With Unusual Call Option Activity:

• 1) TTD 2) RLGY 3) RUN 4) OLED 5) AA

Stocks With Most Positive News Mentions:

• 1) TTD 2) RUTH 3) OLED 4) EPAY 5) PLNT

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -2.8% Below 100-Day Average
• 1 Sector Rising, 10 Sectors Declining
• 34.0% of Issues Advancing, 62.7% Declining
• 47 New 52-Week Highs, 69 New Lows
• 54.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.2%
• Vix 13.0 +14.9%
• Total Put/Call 1.15 +33.7%
• TRIN/Arms 1.47 +18.2%

Friday Watch

Evening Headlines

Bloomberg:       

• Japan’s Economy Rebounds as Business Spending Beats Expectations.  

• Asia's $184 Billion Debt Wall to Spark Buybacks, Bond Swaps.

• Hedge Funds Are Shorting Australian Retailers as Home Prices Fall

• Trump Pushes Medicare Doctors to Rein In Costs or Face Penalties.  

• Markets in U.S. Are Defying the Tumult Convulsing Rest of World. 

• Asian Stocks Edge Lower; Dollar Holds Advance: Markets Wrap. Stocks slipped in Asia after the dollar climbed and Treasuries rose, with investors assessing the impact of the latest tit-for-tat in the trade war as well as sanctions on Russia that hit the ruble. Equities declined in Japan and South Korea, while Australian shares were little changed. Futures signaled modest gains for stocks when trading begins in China and Hong Kong. The dollar kept its advance against its G-10 counterparts and Treasury yields held losses as investors sought safe haven assets following American economic data that were generally on the soft side. Japan’s Topix index fell 0.4 percent as of 9:10 a.m. in Tokyo. Futures on the FTSE China A50 Index rose 0.3 percent. Futures on Hong Kong’s Hang Seng Index climbed 0.2 percent. Australia’s S&P/ASX 200 Index advanced 0.1 percent.    

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

• Deutsche Quants Go Long U.S. Banks on ETF Misprice, Higher Rates.   

• One Chart on Crisis Anniversary Shows How Market Bulls Won Big.

Wall Street Journal:

• The Democrats’ New Litmus Test: Gun Control.

• Tribune Terminates $3.9 Billion Merger With Rival Sinclair.

• Economists See Growth Hitting 3% in 2018.

• Valuations Are Slipping Even as Stocks Hover Near Records.

• Meet the Chatbots Providing Mental Health Care.

• U.S. Sanctions Put Russia on Edge.

• Hedge Fund Backed by Industry Leaders Closes Its Doors.

Fox News:

• Philly's dancing mayor slammed by DOJ, citing freed illegal immigrants' crimes.

• Home prices rise at the fastest pace in more than four years, defying expectations of a pullback.

CNBC:  

• After-hours buzz: TSLA, OSTK & more.

• Trump's pressure on trade may force China to act faster on reforms, analysts say.

• Moody's says Musk's plan to take Tesla private could hurt its credit rating.

• US-China trade war doesn't change the bull case for oil, Goldman's commodity chief says.
  

• Growth stocks rebound after big sell-off, could signal more gains for broader market. 

• Top auto supplier Magna takes $60 million hit from tariffs, but CEO still sees 'huge' opportunity.

Zero Hedge:  

• Dianne Feinstein Was An "Easy Mark" For China's Spy: Sperry.

• Tesla Board Confirms It Never Saw LBO "Financing Plan" From Musk.

• Tesla Tumbles As Broader SEC Inquiry Revealed.

• "Revolutionary" Professors Allow Students To Pick Their Own Grades.

• Watch Antifa Storm Portland City Hall, Smash Security Guard In Head.

• New Report Says Philadelphia Leads US In Wage Growth.

• The Swiss National Bank Now Owns $87.5 Billion In US Stocks After Q2 Tech Buying Spree.

• Bonds & Bitcoin Bid As Musk Massacred, Russia Routed, & Turkey Trampled.

Business Insider:

• Support for a People's Vote on Brexit surges as no deal risk grows.

Night Trading 

• Asian equity indices are -.75% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 80.0 +.75 basis point. 

• Asia Pacific Sovereign CDS Index 10.25 unch.

• Bloomberg Emerging Markets Currency Index 68.21 -.07%.

• FTSE 100 futures -.09%

• S&P 500 futures -.17%.

• NASDAQ 100 futures -.22%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (AIT)/1.00

• (MDP)/.73

• (RUTH)/.30

After the Close:

• None of note

Economic Releases 
8:30 am EST

• The CPI MoM for July is estimated to rise +.2% versus a +.1% gain in June.

• The CPI Ex Food and Energy MoM for July is estimated to rise +.2% versus a +.2% gain in June.

• Real Avg Hourly Earnings YoY for July.

2:00 pm EST

• The Monthly Budget Statement for July is estimated at -$76.0B versus -$42.9B in June.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK Industrial Production report and the WasDe Crop report could also impact trading today.

BOTTOM LINE:  Asian indices are mostly lower, weighed down by technology and industrial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 75% net long heading into the day.

Stocks Slightly Higher into Final Hour on Earnings Outlooks, Lower Long-Term Rates, Short-Covering, Restaurant/Telecom Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Mixed
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 10.9 +.37%

• Euro/Yen Carry Return Index 133.35 -.51%

• Emerging Markets Currency Volatility(VXY) 10.81 +4.04%

• S&P 500 Implied Correlation 28.69 +7.6%

• ISE Sentiment Index 96.0 +15.7%
  

• Total Put/Call .82 -14.6%

• NYSE Arms 1.32 +16.4%

Credit Investor Angst:

• North American Investment Grade CDS Index 58.62 +.92%
  

• America Energy Sector High-Yield CDS Index 364.0 +1.60%

• European Financial Sector CDS Index 79.74 +1.55%

• Italian/German 10Y Yld Spread 252.25 +.75 basis point
  

• Asia Pacific Sovereign Debt CDS Index 10.20 +.25%

• Emerging Market CDS Index 181.47 +3.34%
  

• iBoxx Offshore RMB China Corporate High Yield Index 150.52 +.16%

• 2-Year Swap Spread 19.5 unch.

• TED Spread 30.0 +1.0 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -7.0 -.5 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 68.31 -.95%
• 3-Month T-Bill Yield 2.04% -1.0 basis point

• Yield Curve 28.25 -1.5 basis points

• China Iron Ore Spot 69.60 USD/Metric Tonne -.01%

• Citi US Economic Surprise Index -12.0 +1.1 points

• Citi Eurozone Economic Surprise Index -34.30 -.8 point

• Citi Emerging Markets Economic Surprise Index -2.0 -.2 point

• 10-Year TIPS Spread 2.11 -2.0 basis points
  
• 92.5% chance of Fed rate hike at Nov. 8th meeting, 97.4% chance at Dec. 19th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +2 open in Japan 
• China A50 Futures: Indicating +83 open in China

• DAX Futures: Indicating +1 open in Germany

Portfolio: 

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

• Disclosed Trades: None

• Market Exposure: 100% Net Long

Bull Radar

Style Outperformer:

• Small-Cap Growth +.8%

Sector Outperformers:

• 1) Telecom +3.5% 2) Tobacco +2.8% 3) Networking +1.3%

Stocks Rising on Unusual Volume:

• DNB, YELP, BEL, ROKU, ANGI, AYX, WP, BXC, ORBC, SGMO, CVNA, WMGI, RPD, TRCO, MBI, SAIL, ECPG, CTL, JACK, ATTU, TPB, ACAD, FLS, RESI, ITG, CBB, AYX, VSTO, ANGI, MTCH, WMS, NUAN, IAC, LASR, ECPG, MBI, DBX, PZZA, ACAD, SUN, XPER, SGRY, GDOT, FLS, VIAB, TWNK, NCLH, ALNY, HDP, LITE, GVA and OMI

Stocks With Unusual Call Option Activity:

• 1) CHRW 2) WIN 3) CVNA 4) IAC 5) XRT

Stocks With Most Positive News Mentions:

• 1) CVNA 2) YELP 3) ROKU 4) CTL 5) AYX

Charts:

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