Thursday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 65.0 +.75 basis point.

• China Sovereign CDS 40.75 -1.0 basis point.

• Bloomberg Emerging Markets Currency Index 66.55 +.02%.

• S&P 500 futures -.02%.

• NASDAQ 100 futures -.01%.

Morning Preview Links 

Earnings of Note 
Company/Estimate

Before the Open:

• (AGCO)/.43
• (ABC)/1.96
• (APTV)/1.01
• (AVP)/.00
• (BERY)/.99
• (DLPH)/.53
• (DISCA)/.80
• (DNKN)/.62
• (FSS)/.26
• (GPN)/1.29
• (HBI)/.25
• (ICE)/.90
• (K)/.95
• (MUR)/.11
• (ZEUS)/.22
• (PH)/3.01
• (PWR)/.83
• (SAGE)/-3.19
• (BID)/-.18
• (SFM)/.41
• (SSYS)/.06
• (THS)/.12
• (VMC)/.37
• (W)/-1.60
• (WEX)/1.69
• (ZTS)/.79

After the Close:

• (ATVI)/.25
• (ANET)/2.07
• (BZH)/.06
• (CBS)/1.37
• (CTSH)/1.04
• (LOCO)/.15
• (EXPE)/-.36
• (FSLR)/-.12
• (FLS)/.34
• (FLR)/.53
• (GILD)/1.60
• (KLIC)/-.04
• (LGND)/29.89
• (MTZ)/.43
• (MELI)/-.13
• (MNST)/.43
• (RMAX)/.47 
• (SHAK)/.13
• (TRUP)/.01
• (X)/.19
• (OLED)/.32
• (UPLD)/.52
• (WYNN)/1.58

Economic Releases 
7:30 am EST

• Challenger Job Cuts YoY for April.
  

8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 215K versus 230K the  prior week.
• Continuing Claims are estimated to rise to 1660K versus 1655K prior.
• Preliminary 1Q Non-Farm Productivity is estimated to rise +2.2% versus a +1.9% gain in 4Q.
• Preliminary 1Q Unit Labor Costs is estimated to rise +1.5% versus a +2.0% gain in 4Q.
  

10:00 am EST

• Factory Orders for March are estimated to rise +1.5% versus a -.5% gain in February.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Eurozone Manufacturing PMI report, BoE meeting, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report, ThinkEquity Conference and the (CAT) investor meeting could also impact trading today.

BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity and technology 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 Reversing Slightly Lower into Final Hour on US Economic Data, Less Dovish FOMC Commentary, Profit-Taking, Commodity/Telecom Sector Weakness

 Broad Equity Market Tone:

• Advance/Decline Line: Around Even
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 13.2 +.38%

• Euro/Yen Carry Return Index 129.83 unch.

• Emerging Markets Currency Volatility(VXY) 8.01 -.37%

• S&P 500 Implied Correlation 35.99 +2.79%

• ISE Sentiment Index 68.0 -5.6%
  

• Total Put/Call .91 -10.78%

• NYSE Arms 1.64 +72.3%

Credit Investor Angst:

• North American Investment Grade CDS Index 57.40 -.32%
  

• America Energy Sector High-Yield CDS Index 452.0 -.22%

• European Financial Sector CDS Index 68.66 +.18%

• Italian/German 10Y Yld Spread 254.25 +.25 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 64.08 -.23%
  

• Emerging Market CDS Index 190.02 -.95%
  

• iBoxx Offshore RMB China Corporate High Yield Index 162.08 +.02%

• 2-Year Swap Spread 12.0 +.75 basis point

• TED Spread 17.0 +.75 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -20.75 -.5 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 66.55 -.1%
• 3-Month T-Bill Yield 2.41% unch.

• Yield Curve 21.0 -2.75 basis points

• China Iron Ore Spot 93.79 USD/Metric Tonne +1.23%

• Citi US Economic Surprise Index -55.90 +2.8 points

• Citi Eurozone Economic Surprise Index -31.50 -.4 point

• Citi Emerging Markets Economic Surprise Index -7.60 +2.6 points

• 10-Year TIPS Spread 1.93 -2.0 basis points
• 22.1% chance of Fed rate cut at July 31st meeting, 37.6% chance of cut at Sept. 18th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +132 open in Japan 
• China A50 Futures: Indicating +18 open in China

• DAX Futures: Indicating +11 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 75% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Growth -.2%

Sector Underperformers:

• 1) Coal -4.6% 2) Gold & Silver -1.6% 3) Telecom -1.2%

Stocks Falling on Unusual Volume: 

• HRTX, NATI, MGPI, SSNC, PI, DIN, ASH, TWLO, HCSG, AMED, CLX, QUAD, AX, BLKB, MC and PETQ

Stocks With Unusual Put Option Activity:

• 1) GPRO 2) MLM 3) GNW 4) JCI 5) SWN

Stocks With Most Negative News Mentions:

• 1) PBI 2) WFT 3) AX 4) KSHB 5) WST

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.2%

Sector Outperformers:

• 1) Education +3.2% 2) Computer Hardware +1.4% 3) Homebuilding +1.3%

Stocks Rising on Unusual Volume:

• ENPH, PCRX, NUS, ROG, OSIS, MX, AKAM, NANO, TPB, SMG, DMRC, IPHI, TWST, HUBG, LBRT, USNA, GRUB, STRA, AJRD, AUDC, GDI, HRS, MRY, LOVE, HLF, RCL, HRS, BDC, LLL, HLT, SMG, TKR, JCI and VEVO

Stocks With Unusual Call Option Activity:

• 1) DO 2) GPRO 3) PGR 4) MYL 5) FLEX

Stocks With Most Positive News Mentions:

• 1) SMG 2) AAPL 3) RCL 4) CVS 5) JCI

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -11.7% Below 100-Day Average
• 7 Sectors Rising, 4 Sectors Declining
• 51.0% of Issues Advancing, 46.3% Declining
• 201 New 52-Week Highs, 33 New Lows
• 59.1% of Issues Above 200-day Moving Average
• Average 14-Day RSI 51.8%
• Vix 13.1 -.5%
• Total Put/Call .76 -25.5%
• TRIN/Arms 1.55 +53.5%

Wednesday Watch

Night Trading 

• Asian equity indices are -.25% to +.50% on average.

• Asia Ex-Japan Investment Grade CDS Index 64.25 +.25 basis point.

• China Sovereign CDS 41.75 +.5 basis point.

• Bloomberg Emerging Markets Currency Index 66.63 +.03%.

• S&P 500 futures +.24%.

• NASDAQ 100 futures +.58%.

Morning Preview Links 

Earnings of Note 

Company/Estimate

Before the Open:

• (AAWW)/.85
• (ADP)/1.69
• (CLX)/1.48
• (CME)/1.60
• (CVS)/1.51
• (EL)/1.30
• (HLT)/.76
• (HUM)/4.30
• (IDXX)/1.05
• (JCI)/.30
• (LLL)/2.47
• (TAP)/.58
• (BTU)/.56
• (PBI)/.21 
• (RCL)/1.11
• (SGMS)/-.05
• (SMG)/3.43
• (SEE)/.56
• (SO)/.72
• (S)/-.01
• (STRA)/1.43
• (UTHR)/2.61
• (YUM)/.82

After the Close:

• (ALL)/2.32
• (CAR)/-1.00
• (BLUE)/-2.83
• (CZR)/-.19
• (CF)/.33
• (CAKE)/.60
• (CRUS)/.12
• (ESV)/-1.30
• (STAY)/.15
• (HCP)/.43
• (H)/.29
• (KHC)/.61
• (CLI)/.41
• (MET)/1.27
• (OI)/53
• (PPC)/.34
• (PRU)/3.15
• (PSA)/2.52
• (QCOM)/.71
• (RGLD)/.44
• (SQ)/.08
• (WMB)/.22
• (XPO)/.41

Economic Releases 

8:15 am EST

• The ADP Employment Change for April is estimated to rise to 180K versus 129K in March.
  

10:00 am EST

• ISM Manufacturing for April is estimated to fall to 55.0 versus 54.3 in March.
• ISM Prices Paid for April is estimated to rise to 55.0 versus 54.3 in March.
• Construction Spending MoM for March is estimated unch. versus a +1.0% gain in February.
  

2:00 pm EST

• The FOMC is expected to leave the benchmark Fed Funds Rate at 2.25-2.5%.

Afternoon

• Wards Total Vehicle Sales are estimated to fall to 17.0M versus 17.5 in March.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Economic Projections/Press Conference, weekly EIA energy inventory data and the weekly MBA Mortgage Applications report could also impact trading today.

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and technology shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 100% net long heading into the day.