Bear Radar

Style Underperformer:

• Small-Cap Value +.1%

Sector Underperformers:

• 1) Banks -.8% 2) Papers -.6% 3) Retail -.3%

Stocks Falling on Unusual Volume: 

• VIRT, A, WMC, PLCE, TEVA, EGHT, NEWR, TLRY, MGNX and PBYI

Stocks With Unusual Put Option Activity:

• 1) RF 2) AET 3) JWN 4) RHT 5) CIEN

Stocks With Most Negative News Mentions:

• 1) SLDB 2) ICON 3) ARA 4) GIII 5) FIZZ

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +1.1%

Sector Outperformers:

• 1) Computer Hardware +1.6% 2) Shipping +1.3% 3) Internet +1.2%

Stocks Rising on Unusual Volume:

• DOX, IGV, BABA, WERN, SOXX, FTDR, YMAB, AVDR, KTOS, DOVA, TWOU, JACK, TTD, STM, MGTX, QNST, TCX, AEIS, KNSL, CYBR, DAVA, DMRC, LM, CHD, WAIR and AFIN

Stocks With Unusual Call Option Activity:

• 1) FITB 2) TMUS 3) KTOS 4) ITB 5) ADP

Stocks With Most Positive News Mentions:

• 1) DOX 2) AMAT 3) ZG 4) PGR 5) ALPN

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -7.0% Below 100-Day Average
• 11 Sectors Rising, 0 Sectors Declining
• 65.3% of Issues Advancing, 31.4% Declining
• 86 New 52-Week Highs, 71 New Lows
• 50.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 44.7%
• Vix 16.8 -7.2%
• Total Put/Call 1.44 +41.2%
• TRIN/Arms 1.24 +57.0%

Wednesday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 71.75 unch.

• China Sovereign CDS 48.5 -2.75 basis points.

• Bloomberg Emerging Markets Currency Index 66.03 -.09%.

• S&P 500 futures -.11%.

• NASDAQ 100 futures -.06%.

Morning Preview Links 

Earnings of Note 

Company/Estimate

Before the Open:

• (BABA)/6.51

• (M)/.34

• (RUBY)/-.41

• (PLCE)/-.54

• (TSG)/.44

After the Close:

• (CSCO)/.77

• (FLO)/.30

• (JACK)/.93

• (KHC)/.61

• (NTES)/2.48

Economic Releases

8:30 am EST

• Empire Manufacturing for May is estimated to fall to 8.0 versus 10.1 in April.

• Retail Sales Advance MoM for April is estimated to rise +.2% versus a +1.6% gain in March.

• Retail Sales Ex Autos MoM for April is estimated to rise +.7% versus a +1.2% gain in March. 

• Retail Sales Ex Autos and Gas for April is estimated to rise +.3% versus a +.9% gain in March.
  

9:15 am EST

• Industrial Production MoM for April is estimated unch. versus a -.1% decline in March.

• Manufacturing Production for April is estimated unch. versus unch. in March.

• Capacity Utilization for April is estimated to fall to 78.7% versus 78.8% in March.

10:00 am EST

• The NAHB Housing Market Index for May is estimated to rise to 64.0 versus 63.0 in April.

• Business Inventories for March is estimated unch. versus a +.3% gain in Feb.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +29,000 barrels versus a -3,963,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -439,500 barrels versus a -596,000 barrel decline the prior week. Distillate inventories are estimated to fall by -613,700 barrels versus a -159,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.57% versus a -.3% decline prior.
  

Afternoon:

• Net Long-Term TIC Flows for March.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Barkin speaking, Fed's Quarles speaking, Senate Hearing with Steve Mnuchin, China Industrial Profits/Retail Sales reports, Eurozone GDP report, House Transport/Infra Committee hearing on (BA) 737 Max, weekly MBA Mortgage Applications report, Goldman Industrials/Materials Conference,  could also impact trading today.

BOTTOM LINE: Asian indices are slightly 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 Surging into Final Hour on China Trade Deal Hopes, Less Emerging Markets Debt Angst, Oil Gain, Tech/Transport Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Outperforming

Equity Investor Angst:

• Volatility(VIX) 18.0 -12.7%

• Euro/Yen Carry Return Index 127.70 +.18%

• Emerging Markets Currency Volatility(VXY) 8.99 -1.86%

• S&P 500 Implied Correlation 40.96 -4.12%

• ISE Sentiment Index 64.0 +1.59%
  

• Total Put/Call 1.05 -2.78%

• NYSE Arms .67 -63.59%

Credit Investor Angst:

• North American Investment Grade CDS Index 63.26 -2.23%
  

• America Energy Sector High-Yield CDS Index 571.0 +6.02%

• European Financial Sector CDS Index 79.91 -3.2%

• Italian/German 10Y Yld Spread 279.75 +2.75 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 72.08 +.38%
  

• Emerging Market CDS Index 202.18 -3.19%
  

• iBoxx Offshore RMB China Corporate High Yield Index 162.76 -.01%

• 2-Year Swap Spread 7.75 -.75 basis point

• TED Spread 14.5 +2.75 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -17.75 +1.0 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 66.08 +.22%
• 3-Month T-Bill Yield 2.39% -1.0 basis point

• Yield Curve 21.75 unch.

• China Iron Ore Spot 91.06 USD/Metric Tonne +.25%

• Citi US Economic Surprise Index -30.80 +7.5 points

• Citi Eurozone Economic Surprise Index -19.50 -3.9 points

• Citi Emerging Markets Economic Surprise Index -19.50 unch.

• 10-Year TIPS Spread 1.87 +2.0 basis points
• 24.9% chance of Fed rate cut at July 31st meeting, 48.0% chance of cut at Sept. 18th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +103 open in Japan 
• China A50 Futures: Indicating +30 open in China

• DAX Futures: Indicating +1 open in Germany

Portfolio:

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

• Disclosed Trades:Covered some of my (IWM)/(QQQ) hedges and emerging market shorts

• Market Exposure: Moved to 75% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Value +1.2%

Sector Underperformers:

• 1) Gold & Silver -.7% 2) Utilities -.3% 3) Healthcare Providers +.4%

Stocks Falling on Unusual Volume: 

• MYOV, TME, BILI, RL, TAK and GIII

Stocks With Unusual Put Option Activity:

• 1) RF 2) AET 3) JWN 4) RHT 5) CIEN

Stocks With Most Negative News Mentions:

• 1) SLDB 2) ICON 3) ARA 4) GIII 5) FIZZ

Charts:

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