Bear Radar

Style Underperformer:

• Large-Cap Growth unch.

Sector Underperformers:

• 1) Papers -1.2% 2) Healthcare Providers -1.2% 3) Alt Energy -1.0%

Stocks Falling on Unusual Volume: 

• RTRX, SPLK, HMLP, FLWS, LB, SRPT, SEDG, WUBA, BZUN, SQM, TLRY, BLUE and GH

Stocks With Unusual Put Option Activity:

• 1) RTRX 2) AABA 3) CNC 4) DKS 5) GME

Stocks With Most Negative News Mentions:

• 1) LB 2) SQM 3) SEDG 4) EQT 5)MSGN

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +.5%

Sector Outperformers:

• 1) Disk Drives +1.9% 2) Retail +1.8% 3) Computer Hardware +1.6%

Stocks Rising on Unusual Volume:

• ALXN, OPRA, JWN, KEYS, DKS, JBSS, BJ, FLY, PSTG, HTHT, SMPL, APO, RRGB, SNPS, PLCE, URBN, CATO, GPS, OSTK, CNMD, BA, MAC, GPS and FSLY

Stocks With Unusual Call Option Activity:

• 1) GPS 2) GLW 3) JWN 4) PSTG 5) AEO

Stocks With Most Positive News Mentions:

• 1) JWN 2) KEYS 3) BJ 4) SSI 5) DKS

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -13.5% Below 100-Day Average
• 3 Sectors Rising, 8 Sector Declining
• 48.3% of Issues Advancing, 48.8% Declining
• 164 New 52-Week Highs, 55 New Lows
• 50.2% of Issues Above 200-day Moving Average
• Average 14-Day RSI 45.5%
• Vix 16.9 +7.2%
• Total Put/Call .97 -25.4%
• TRIN/Arms .70 -30.0%

Stocks Rising into Final Hour on Earnings Optimism, China Trade Deal Hopes, Short-Covering, Retail/Tech Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 15.87 -9.3%

• Euro/Yen Carry Return Index 122.70 +.2%

• Emerging Markets Currency Volatility(VXY) 8.65 -1.14%

• S&P 500 Implied Correlation 43.0 -5.8%

• ISE Sentiment Index 51.0 -40.7%
  

• Total Put/Call 1.42 +65.1%

• NYSE Arms 1.06 -36.1%

Credit Investor Angst:

• North American Investment Grade CDS Index 56.52 -3.07%
  

• America Energy Sector High-Yield CDS Index 413.0 -1.13%

• European Financial Sector CDS Index 61.37 -5.87%

• Italian/German 10Y Yld Spread 200.25 -6.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 65.42 -.97%
  

• Emerging Market CDS Index 206.53 -2.14%
  

• iBoxx Offshore RMB China Corporate High Yield Index 164.86 +.06%

• 2-Year Swap Spread -.5 -1.0 basis point

• TED Spread 24.0 -1.0 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -8.75 -1.5 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 65.62 +.35%
• 3-Month T-Bill Yield 1.97% +7.0 basis points

• Yield Curve 1.25 -3.5 basis points

• China Iron Ore Spot 78.34 USD/Metric Tonne -5.03%

• Citi US Economic Surprise Index -10.1 +.8 point

• Citi Eurozone Economic Surprise Index -59.90 +.4 point

• Citi Emerging Markets Economic Surprise Index -25.3 +.3 point

• 10-Year TIPS Spread 1.54 unch.
• 100.0% chance of Fed rate cut at Oct. 30th meeting, 100.0% chance of cut at Dec. 11th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +42 open in Japan 
• China A50 Futures: Indicating +46 open in China

• DAX Futures: Indicating -19 open in Germany

Portfolio:

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

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 75% Net Long

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -13.0% Below 100-Day Average
• 10 Sectors Rising, 1 Sector Declining
• 71.0% of Issues Advancing, 26.2% Declining
• 144 New 52-Week Highs, 37 New Lows
• 48.0% of Issues Above 200-day Moving Average
• Average 14-Day RSI 43.9%
• Vix 15.6 -10.7%
• Total Put/Call 1.1 +27.9%
• TRIN/Arms 1.09 -34.3%

Wednesday Watch

Night Trading 

• Asian equity indices are -1.0% to -.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 65.75 -.47%.

• China Sovereign CDS 46.75 -1.25 basis points.

• Bloomberg Emerging Markets Currency Index  65.39 unch.
• FTSE 100 futures n/a.

• S&P 500 futures +.05%.

• NASDAQ 100 futures +.07%.

Morning Preview Links 

Earnings of Note 

Company/Estimate

Before the Open:

• (ADI)/1.23
• (LOW)/2.00
• (TGT)/1.62
• (PLCE)/.18

After the Close:

• (LB)/.20
• (JWN)/.77
• (SPLK)/.12
• (SNPS)/1.10

Economic Releases

10:00 am EST

• Existing Home Sales for July is estimated to rise to 5.4M versus 5.27M in June.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -1,391,560 barrels versus a +1,580,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -72,560 barrels versus a -1,412,000 barrel decline the prior week. Distillate inventories are estimated to rise by +35,330 barrels versus a -1,938,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to fall by -.06% versus a -1.6% decline prior.

2:00 pm EST

• July 31 FOMC Meeting Minutes.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Canadian CPI report and the weekly MBA Mortgage Applications report could also impact trading today.

BOTTOM LINE: Asian indices are lower, weighed down by financial and consumer shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.