Friday Watch

Night Trading 

• Asian equity indices are +.5% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 54.0 -.75 basis point.

• China Sovereign CDS 30.75  -.5 basis point.

• Bloomberg Emerging Markets Currency Index  66.58 unch.
• FTSE 100 futures n/a.

• S&P 500 futures +.21%.

• NASDAQ 100 futures +.25%.

Morning Preview Links

Earnings of Note 

Company/Estimate

Before the Open:

• (INFY)/9.78

After the Close:

• None of note

Economic Releases  

8:30 am EST

• The Change in Non-Farm Payrolls for Dec. is estimated to fall to 160K versus 266K in Nov.
• The Unemployment Rate for Dec. is estimated at 3.5% versus 3.5% in Nov.
• Average Hourly Earnings MoM for Dec. is estimated to rise +.3% versus a +.2% gain in Nov.

10:00 am EST

• Wholesale Trade Sales MoM for Nov. is estimated to rise +.2% versus a -.7% decline in Oct.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK Trade Balance report, Bloomberg US Economic Survey for Jan. and the (FDX) Jan. economic update could also impact trading today.

Market Hours

Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are higher, boosted by technology 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 Rising into Final Hour on China Trade Deal Optimism, Diminished Mideast Tensions, Technical Buying, Energy/Tech Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 12.9 -4.3%

• Euro/Yen Carry Return Index 126.30 +.38%

• Emerging Markets Currency Volatility(VXY) 6.6 -2.1%

• S&P 500 Implied Correlation 38.2 -10.0%

• ISE Sentiment Index 113.0 +2
  

• Total Put/Call .63 -16.0%

• NYSE Arms 1.22 -9.6%

Credit Investor Angst:

• North American Investment Grade CDS Index 44.39 -2.18%
  

• America Energy Sector High-Yield CDS Index 524.0 +2.58%

• European Financial Sector CDS Index 50.56 -3.81%

• Italian/German 10Y Yld Spread 155.75 +6.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 54.51 -2.22%
  

• Emerging Market CDS Index 178.89 -.58%
  

• iBoxx Offshore RMB China Corporate High Yield Index 168.59 +.16%

• 2-Year Swap Spread 6.5 unch.

• TED Spread 35.0 -.5 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -2.75 +.5 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 66.59 -.02%
• 3-Month T-Bill Yield 1.53% unch.

• Yield Curve .28 unch.

• China Iron Ore Spot 91.83 USD/Metric Tonne -.91%

• Citi US Economic Surprise Index 1.7 +1.4 points

• Citi Eurozone Economic Surprise Index 42.40 -1.3 point

• Citi Emerging Markets Economic Surprise Index -8.4 -.9 basis point

• 10-Year TIPS Spread 1.76 unch.
• 4.7% chance of Fed rate cut at March 18th meeting, 12.2% chance of cut at April 29th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +36 open in Japan 
• China A50 Futures: Indicating +28 open in China

• DAX Futures: Indicating +3 open in Germany

Portfolio:

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

• Disclosed Trades: None

• Market Exposure: 100% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Value -.1%

Sector Underperformers:

• 1) Steel -1.6% 2) Retail -.7% 3) Gold & Silver -.6%

Stocks Falling on Unusual Volume: 

• MIRM, SDC, GMED, TEN, KSS, SMPL, AYI and BBBY

Stocks With Unusual Put Option Activity:

• 1) S 2) BBBY 3) KKR 4) KSS 5) DBX

Stocks With Most Negative News Mentions:

• 1) JCP 2) CATO 3) KSS 4) AMAG 5) ALLK

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.8%

Sector Outperformers:

• 1) Shipping +1.6% 2) Restaurants +1.4% 3) Social Media +1.1%

Stocks Rising on Unusual Volume:

• AYNX, ALEC, BYND, INMD, XENT, BMRN, MDB, MDLA, NATI, TGTX, VOYA, PFNX, CAR, SPCE, TNDM, SNAP, KPTI, COLL, JEF, ACM, ZS, DERM, FRTA, SAIL, APPN, RGNX, CHWY, CARA, ALGN, AZPN, SAIC, CUE, CYRX, MTEM, FICO, RCKT, INSP, BPOP, MKTX,

Stocks With Unusual Call Option Activity:

• 1) TJX 2) VSTM 3) HBAN 4) KBH 5) ALGN

Stocks With Most Positive News Mentions:

• 1) LNN 2) ADMA 3) BPOP 4) AZZ 5) PKE

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +7.0% Above 100-Day Average
• 10 Sectors Rising, 1 Sector Declining
• 59.0% of Issues Advancing, 37.7% Declining
• 174 New 52-Week Highs, 8 New Lows
• 65.0% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.3%
• Vix 12.9 -3.6%
• Total Put/Call .50 -33.3%
• TRIN/Arms 1.66 +23.0%

Thursday Watch

Night Trading 

• Asian equity indices are +.75% to +1.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 54.75 -4.0 basis points.

• China Sovereign CDS 31.25  -3.25 basis points.

• Bloomberg Emerging Markets Currency Index  66.64 +.07%.
• FTSE 100 futures +.39%.

• S&P 500 futures +.11%.

• NASDAQ 100 futures +.16%.

Morning Preview Links

Earnings of Note 

Company/Estimate

Before the Open:

• (AYI)/2.21
• (AZZ)/.80
• (LNN)/.55 

After the Close:

• (JEF)/.23
• (KBH)/1.30
• (PSMT)/.69
• (SNX)/3.52
• (WDFC)/.99

Economic Releases  

8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 220K versus 222K the prior week.
• Continuing Claims are estimated to fall to 1720K versus 1728K prior.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Clarida speaking, Fed's Bullard speaking, weekly Bloomberg Consumer Comfort Index, $16B 30Y T-Bond auction, Australia Retail Sales report, BofA Merrill Aerospace/Defense Outlook Conference, (CASY) investor day and the (MNST) Investor Conference could also impact trading today.

Market Hours

Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are higher, boosted by technology 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.