Stocks Rising into Afternoon on Global Growth Optimism, Less European/Emerging Markets Debt Angst, Technical Buying, Tech/Homebuilding Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 12.5 -.16%

• Euro/Yen Carry Return Index 125.82 -.33%

• Emerging Markets Currency Volatility(VXY) 6.47 -.92%

• S&P 500 Implied Correlation 42.71 +3.56%

• ISE Sentiment Index 81.0 -40
  

• Total Put/Call .74 -3.9%

• NYSE Arms .84 -21.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 45.08 -1.43%
  

• America Energy Sector High-Yield CDS Index 541.0 -1.56%

• European Financial Sector CDS Index 52.35 -.87%

• Italian/German 10Y Yld Spread 166.0 +4.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 54.01 -2.21%
  

• Emerging Market CDS Index 181.81 -1.04%
  

• iBoxx Offshore RMB China Corporate High Yield Index 167.20 -.08%

• 2-Year Swap Spread 7.25 unch.

• TED Spread 36.75 +1.5 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -12.5 -2.75 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 66.27 -.1%
• 3-Month T-Bill Yield 1.56% unch.

• Yield Curve .29 unch.

• China Iron Ore Spot 91.90 USD/Metric Tonne +2.01%

• Citi US Economic Surprise Index -7.6 +.4 basis point

• Citi Eurozone Economic Surprise Index 16.30 +5.6 points

• Citi Emerging Markets Economic Surprise Index -16.2 -.1 basis point

• 10-Year TIPS Spread 1.78 unch.
• 9.2% chance of Fed rate cut at March 18th meeting, 16.5% chance of cut at April 29th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +30 open in Japan 
• China A50 Futures: Indicating +63 open in China

• DAX Futures: Indicating +2 open in Germany

Portfolio:

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

• Disclosed Trades: None

• Market Exposure: 100% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Value +.4%

Sector Underperformers:

• 1) Gold & Silver -.6% 2) Oil Service -.5% 3) Networking -.5%

Stocks Falling on Unusual Volume: 

• BROG, KMX, IIPR, MIRM, DRNA, X, HIIQ and CAMP

Stocks With Unusual Put Option Activity:

• 1) KMX 2) MET 3) RAD 4) CAG 5) UAA

Stocks With Most Negative News Mentions:

• 1) CAMP 2) MIK 3) X 4) YJ 5) PCG

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value +.7%

Sector Outperformers:

• 1) Agriculture +1.0% 2) Pharma +1.0% 3) Computer Services +1.0%

Stocks Rising on Unusual Volume:

• RAD, TXG, CRCM, KRTX, HCAT, BBIO, WGO, CLI, DTIL, CCL, ALEC, RVLV, FTSV, GOSS, PING, FRTA, AXSM, CYRX, EPAC, PRMW, SITE, NCLH, MAXR, AERI, XENT, RCL, NEO, CAL, YMAB, CROX, BRKR, ALTR, NAV, SPB, SPCE, VECO and NOVA

Stocks With Unusual Call Option Activity:

• 1) EUFN 2) MRTX 3) KMX 4) ZTS 5) K

Stocks With Most Positive News Mentions:

• 1) CRCM 2) BB 3) CCL 4) GILD 5) AMD

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +34.2% Above 100-Day Average
• 11 Sectors Rising, 0 Sectors Declining
• 64.2% of Issues Advancing, 32.6% Declining
• 219 New 52-Week Highs, 4 New Lows
• 64.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 51.9%
• Vix 12.3 -2.0%
• Total Put/Call .81 +1.3%
• TRIN/Arms .68 -37.4%

Friday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 54.5 -.75 basis point.

• China Sovereign CDS 32.5 +.25 basis point.

• Bloomberg Emerging Markets Currency Index  66.34 -.01%.
• FTSE 100 futures -.03%.

• S&P 500 futures -.03%.

• NASDAQ 100 futures -.02%.

Morning Preview Links

Earnings of Note 

Company/Estimate

Before the Open:

• (BB)/.02
• (KMX)/1.15
• (CCL)/.51
• (WGO)/.59

After the Close:

• None of note

Economic Releases 

10:00 am EST

• Personal Income for Nov. is estimated to rise +.3% versus unch. in Oct.
• Personal Spending for Nov. is estimated to rise +.4% versus a +.3% gain in Oct.
• The PCE Core MoM for Nov. is estimated to rise +.1% versus a +.1% gain in Oct. 

11:00 am EST

• Kansas City Fed Manufacturing Activity for Dec. is estimated at -3 versus -3 in Nov.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK GDP report and govt funding deadline could also impact trading today.

BOTTOM LINE: Asian indices are slightly lower, weighed down by consumer 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 Higher into Final Hour on Global Growth Optimism, Earnings, Oil Gain, Tech/Telecom Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Around Average

• Market Leading Stocks: Outperforming

Equity Investor Angst:

• Volatility(VIX) 12.6 +.16%

• Euro/Yen Carry Return Index 126.19 -.16%

• Emerging Markets Currency Volatility(VXY) 6.53 +.93%

• S&P 500 Implied Correlation 41.78 -2.93%

• ISE Sentiment Index 121.0 -10
  

• Total Put/Call .75 -25.7%

• NYSE Arms .93 -7.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 45.71 -.17%
  

• America Energy Sector High-Yield CDS Index 552.0 -1.78%

• European Financial Sector CDS Index 52.81 +.02%

• Italian/German 10Y Yld Spread 161.75 +3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 54.98 -1.38%
  

• Emerging Market CDS Index 183.09 +.97%
  

• iBoxx Offshore RMB China Corporate High Yield Index 167.34 +.12%

• 2-Year Swap Spread 7.25 +.5 basis point

• TED Spread 35.25 +.25 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -9.75 +5.75 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 66.34 +.14%
• 3-Month T-Bill Yield 1.56% +1.0 basis point

• Yield Curve .29 +3.0 basis points

• China Iron Ore Spot 91.40 USD/Metric Tonne +.8%

• Citi US Economic Surprise Index -8.0 -4.3 basis points

• Citi Eurozone Economic Surprise Index 10.70 +4.7 points

• Citi Emerging Markets Economic Surprise Index -16.1 +.4 basis point

• 10-Year TIPS Spread 1.78 -1.0 basis point
• 7.1% chance of Fed rate cut at March 18th meeting, 16.9% chance of cut at April 29th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -44 open in Japan 
• China A50 Futures: Indicating +25 open in China

• DAX Futures: Indicating unch. open in Germany

Portfolio:

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

• Disclosed Trades: None

• Market Exposure: 100% Net Long