Thursday Watch

Evening Headlines

Bloomberg:       

• Stimulus Vote Timing in Doubt Amid Dispute Over Unemployment Aid.  
• Spanish Doctors Are Forced to Choose Who to Let Die. 
• Singapore Expects Sharp Contraction in 2020 Economy as Quarterly GDP Plunges.
• Fauci Says Coronavirus Might Become a Seasonal Cycle.
• Deaths Top 20,000; Tokyo Residents to Stay Inside: Virus Update. 
• Asian Stocks Set for Mixed Start; Yen Climbs: Markets Wrap. Asian stocks were poised for a mixed start, following the first back-to-back gains for global equities since mid-February, as negotiations in Congress continued toward a vote on the U.S. stimulus bill later this week. S&P 500 futures fluctuated in Asia after the benchmark’s rally of more than 5% fizzled amid a dispute in the Senate. Contracts in Japan slipped, while those in Hong Kong and Australia gained. Australian shares opened higher. Republican senators raised objections to the unemployment benefits section of the stimulus bill, and Vermont Senator Bernie Sanders threatened to hold up the legislation unless those objections were dropped. The dollar stabilized after declining for a second day against its major peers, and the yen gained. The Australian and New Zealand dollars declined as much as 1%. Treasuries edged lower Wednesday. S&P 500 futures fell 0.4% as of 8:20 a.m. in Tokyo. The S&P 500 Index rose 1.2% on Wednesday. Futures on Japan’s Nikkei 225 slid 1.9%. Hang Seng Index futures added 0.9%. Australia’s S&P/ASX 200 Index gained 1.7%.   
• U.S. Calling on Saudis to Halt Plan to Unleash Record Oil Supply.   
• Five Things You Need to Know to Start Your Day.  
• China Shock Result, Fed’s $4.5 Trillion, Japan Playbook: Eco Day.
• NYC’s 911 Overwhelmed With Record Number of Emergency Medical Calls.  
• Wall Street Bonuses Could Fall 40% This Year in ‘Perfect Storm’.
• Stimulus Bill Has $400 Million in Election Help for States.

Wall Street Journal:  

• Coronavirus Leaves Older Americans Cut Off: ‘We Have Been Trying to Fill That Void’.
• Coronavirus Is Advancing on Poor Nations, and the Prognosis Is Troubling.
• Coronavirus Stimulus Package Hits Last-Minute Snags.
• Coronavirus Shows Cash Is King, Even for Biggest U.S. Companies.
• Texas Company Is Inundated With Orders for Oxygen Device.

CNBC.com:

• Coronavirus live updates: Hundreds flood NYC hospital ICU, ERs; global cases top 466,000.
• Jim Cramer: Wall Street ‘has faith’ in stimulus plan; ‘total lockdown’ is needed.
• Yum Brands suspends $2 billion buyback program, provides royalty grace period for franchisees.
• Stocks making the biggest moves after hours: Micron, Shoe Carnival, Ford & more.
• Salesforce(CRM) promises no ‘significant’ layoffs for three months despite coronavirus.

Fox News:

• Bernie threatens to stall massive coronavirus aid package in fight with GOP senators.
• NYC hospitals stretched far too thin during virus, Dr. Siegel warns.

MarketWatch.com:       

• Opinion: These are the 20 stocks corporate insiders have been buying most amid the coronavirus-induced market selloff.
• Why the commercial mortgage bond market looks dire right now.

Zero Hedge:

• Traders Puke After Bernie Sanders Threatens To Hold Up Coronavirus Package.
• 200 NYPD Officers Test Positive For COVID-19 As NYC Cements Its Position As 'Epicenter' Of US Outbreak: Live Updates.
• Missing Ex-FBI Agent Robert Levinson Declared Dead By Family.
• All T-Bills Up To 3 Months Now Have Negative Yields.
• As Bodies Pile Up, States Ask Emergency FEMA Help To Handle The Dead.
• 47,000 Stores Shutter Across The US As Virtually All Retailers Stop Paying Rent.
• New Jersey "Knucklehead" Faces Terror Charges For Coughing On Grocery Store Clerk.
• 10 Amazon Warehouses Hit With COVID-19 After Workers Test Positive.
• Mario Draghi Urges "War-like" Flood Of Debt As ECB Considers Launching Helicopter Money.
• Pompeo Denounces China's "Wuhan Virus Disinformation Campaign" Before G7 Leaders.
• Bond Market Tears In Two: Distressed Debt Is Cratering, As Fed Buying Of Investment Grade Sends LQD NAV Soaring.
• China Lifts Lockdown On Hubei Province Despite COVID-19 Resurgence.
• Apple Tumbles After Report Says 5G iPhone Could Be Delayed To 2021.
• S&P Downgrades Ford To Junk - Biggest Fallen Angel Yet.
• Unprecedented Collapse: US Airline Traffic Currently Just 10% Of Normal.
• Stocks Scream Higher On Greatest Short-Squeeze In History, Bonds & Bullion Shrug.

Business Insider: 

• Spain reports 738 deaths in one day, surpassing China.
• The 28 US cities with the largest elderly populations.

John Hopkins University:

• Coronavirus Global Cases. (map)

BNO News:

• Tracking Coronavirus: Map, data and timeline.

Google Docs:

• Coronavirus Testing by State.

Night Trading 

• Asian equity indices are -1.75% to +1.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 134.5 -36.0 basis points.

• China Sovereign CDS 44.0 -17.5 basis points.

• Bloomberg Emerging Markets Currency Index  58.79 +.09%.
• Euro Stoxx 50 futures +.11%.

• S&P 500 futures +.11%.

• NASDAQ 100 futures +.08%.

Morning Preview Links

Earnings of Note 
Company/Estimate

Before the Open:

• (CSIQ)/.43
• (FDS)/2.49
• (LK)/-.13
• (MOV)/.21
• (SIG)/3.49
• (TITN)/.01
• (WOR)/.68

After the Close:

• (GME)/.79
• (JEF)/.21
• (KBH)/.44
• (LULU)/2.25
• (RH)/3.59

Economic Releases 
8:30 am EST

• Advance Goods Trade Balance for Feb. is estimated at -$63.4B versus -$65.9B in Jan.
• Wholesale Inventories MoM for Feb. is estimated to fall -.2% versus a -.4% decline in Jan.
• Retail Inventories MoM for Feb. is estimated to fall -.1% versus unch. in Jan.
• Initial Jobless Claims for last week are estimated to rise to 1500K versus 281K the prior week. 
• Continuing Claims are estimated to rise to 1791K versus 1701K prior.
  

11:00 am EST

• The Kansas City Fed Manufacturing Activity Index for March is estimated to fall to -10 versus 5 in Feb.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The BoE rate decision, weekly EIA Natural Gas inventory report and the $32B 7Y T-Note auction could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by financial and commodity shares in the region. I expect US stocks to open lower and to rally into the afternoon, finishing mixed. The Portfolio is 25% net long heading into the day.

Stocks Surging into Final Hour on Global Stimulus Hopes, Oil Gain, Short-Covering, Homebuilding/Transport Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Heavy

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 62.40 +1.0%

• Euro/Yen Carry Return Index 125.50 +.78%

• Emerging Markets Currency Volatility(VXY) 12.61 -4.9%

• S&P 500 Implied Correlation 69.45 +12.8%

• ISE Sentiment Index 75.0 +15
  

• Total Put/Call .89 +1.14%

• NYSE Arms .73 +.46%

Credit Investor Angst:

• North American Investment Grade CDS Index 98.33 -11.2%
  

• America Energy Sector High-Yield CDS Index 1,469.0 -5.32%

• European Financial Sector CDS Index 102.16 -7.71%

• Italian/German 10Y Yld Spread 180.5 -8.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 151.39 -19.3%
  

• Emerging Market CDS Index 294.30 -16.5%
  

• iBoxx Offshore RMB China Corporate High Yield Index 169.96 -.08%

• 2-Year Swap Spread 19.5 +6.75 basis points

• TED Spread 125.0 +1.0 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap 7.5 +8.25 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 58.81 +.89%
• 3-Month T-Bill Yield -.07% -3.0 basis points

• Yield Curve .49 -1.0 basis point

• China Iron Ore Spot 85.17 USD/Metric Tonne +4.52%

• Citi US Economic Surprise Index 61.70 -.6 point

• Citi Eurozone Economic Surprise Index -54.90 -.1 point

• Citi Emerging Markets Economic Surprise Index -28.6 +.1 point

• 10-Year TIPS Spread 1.05 +8.0 basis points
• n/a chance of no change at April 29th meeting, n/a chance of no change at June 10th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +200 open in Japan 
• China A50 Futures: Indicating +104 open in China

• DAX Futures: Indicating +50 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 75% Net Long

Morning Market Internals

NYSE Composite Index:

• Volume Running +95.2% Above 100-Day Average
• 1 Sector Rising, 10 Sectors Declining
• 55.0% of Issues Advancing, 43.4% Declining
• 0 New 52-Week Highs, 30 New Lows
• 2.8% of Issues Above 200-day Moving Average
• Average 14-Day RSI 34.1%
• Vix 64.4 +4.5%
• Total Put/Call .73 -17.1%
• TRIN/Arms 1.53 +206.0%

Wednesday Watch

Evening Headlines

Bloomberg:        

• China’s Hidden Symptom-Free Virus Cases Means Epidemic Not Over.

• Trump’s Target for Ending Lockdown Sets Up Clash With Governors.

• Worldwide Dollar Crunch Raises Red Flags in Asia’s Debt Marke.   

• World’s Miners Slowly Grind to a Halt on Virus Restrictions.

• Stock Rebound Heads to Asia After Wall St. Surge: Markets Wrap. Stocks in Asia rallied after the best session for U.S. stocks in almost a dozen years, with investors rediscovering some appetite for risk as Congress negotiates an emergency-spending bill. U.S. equity futures declined, showing a reluctance to build on Tuesday’s gains. Japan equities opened about 3% higher, while Australian and South Korean shares bounced about 5%, with Asia-Pacific stocks heading for a second day of gains. S&P 500 futures retreated after the index soared more than 9% -- the biggest one-day gain since October 2008. The dollar added to declines against developed and emerging currencies alike, in a tentative sign of reduced stress after the greenback’s recent surge. Treasuries opened flat. Japan’s Topix index rose 3% as of 9:01 a.m. in Tokyo. S&P 500 futures fell 0.7%. The S&P 500 advanced 9.4% on Tuesday. South Korea’s Kospi index gained 5%. Australia’s S&P/ASX 200 Index advanced 4.6%.

• Oil Rides U.S. Risk Rally Though Worries Over Global Glut Linger.

• Five Things You Need to Know to Start Your Day.

• NYC Subway Poles Seen as Spreader; India Lockdown: Virus Update.

• Back-to-Work Push Pits Billionaires Against the Doctors.

• U.S. Retailers Plan to Stop Paying Rent to Offset Virus -1-   

• Apollo Snaps Up Portfolio Company Debt, Touts 250 Ways to Profit.  

• Banks Blindsided as N.Y. Virus Relief Order Roils Contracts.

• Doctors’ Practices Face Cash Crunch as Pandemic Halts Economy.  

• When New York Mandated Vaccinations, Nurses Sued.

Wall Street Journal:    

• Amazon’s Bezos, Other Corporate Executives Sold Shares Just in Time. 

• Older Virus Patients Face Looming ICU Bed Shortage .

• The West Is Misinterpreting Wuhan’s Progress—and Drawing the Wrong Lessons.

• The New Frontline Coronavirus Workers: Grocery Clerks, Delivery Drivers.

• Trump Hopes to Have U.S. Reopened by Easter, Despite Warnings.

CNBC.com:

• Coronavirus live updates: US cases top 53,000, Universal Resort extends closure.

• Cramer tells investors to be cautious of ‘one-day bull market’.

• Coronavirus stimulus talks could drag into Wednesday after lawmakers said deal was close.

• Dow rebounds more than 11% in best day since 1933 as Congress nears coronavirus stimulus deal.

• Coronavirus: New York City to release 300 nonviolent inmates from Rikers Island.

• Nike sales beat analysts’ estimates, but earnings fall, hurt by coronavirus pandemic.

• Los Angeles health officials say a child under 18 has died from the coronavirus.

• Stocks making the biggest moves after hours: Nike, Square, Boeing & more.

Fox News:

• WH pitches $6T coronavirus stimulus package ahead of high-stakes Senate vote.

• Party of 50 guests became coronavirus 'super-spreading event,' report says.

• Tips for handling laundry while staying safe during outbreak.

MarketWatch.com:        

• Goldman Sachs says it is time to buy gold — the ‘currency of last resort' .

• Is it safe to get food delivered? Can you catch coronavirus from the packaging? Will it survive on the surface of your takeout?

Zero Hedge:

• White House Calls For 14-Day Quarantine For Anybody Leaving NY: Live Updates.

• California's Public Employees Retirement System Just Lost A Stunning $69 Billion In One Month.

• Here's What A Lockdown Of India's 1.3 Billion People Looks Like.

• "Someone Is Gonna Get Shot" - LA County Sheriff Orders All Gun Stores Closed.

• WTI Extends "Hope For More Stimulus" Gains On Surprise Crude Draw.

• Advertising Industry In Freefall: Facebook Says Ad Revenue Is Weakening.

• Fed Hires World's Largest Asset Manager To Manage Its Massive Asset Purchases.

• Meet The 'Covidiot': "A Dense Creature That Ignores Simple Instructions, Endangers Others".

• DOJ Asks Congress For "Indefinite Detention Powers" To Fight The Coronavirus.

• Dow Squeezes To Best Day Since 1933, Gold Soars As Dollar Dips.

Business Insider: 

• McDonald's(MCD) is pushing an ordering system invented for truckers, as 1.8 million drivers struggle to find food amid the coronavirus pandemic.  

• Trump says he wants the US open for business by Easter, but he can't actually force governors to reopen their states.

• Photos of packed beaches, bikeways, and hiking trails show how people are ignoring coronavirus social-distancing mandates around the world.

• The world has begun using robots to replace and help humans in the fight against coronavirus by delivering groceries, sanitizing hospitals, and monitoring patients.

• SoftBank reportedly considered a big move to take the company private before settling on a plan to sell off billions in assets.

• Kroger is installing plexiglass shields at cash registers and urging the federal government to secure masks and gloves for grocery workers.

• CVS, Walmart, and 14 other 'essential' businesses that are desperate for workers right now.

John Hopkins University:

• Coronavirus Global Cases. (map)

BNO News:

• Tracking Coronavirus: Map, data and timeline.

Google Docs:

• Coronavirus Testing by State.

Night Trading 

• Asian equity indices are +3.25% to +3.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 171.5 -41.5 basis points.

• China Sovereign CDS 61.5 -10.25 basis points.

• Bloomberg Emerging Markets Currency Index  58.29 unch.

• Euro Stoxx 50 futures -.8%.

• S&P 500 futures -.87%.

• NASDAQ 100 futures -.83%.

Morning Preview Links

Earnings of Note 
Company/Estimate

Before the Open:

• (PAYX)/.94

• (WGO)/.67

After the Close:

• (FUL)/.34

• (MU)/.37

• (SCVL)/.21

Economic Releases 
8:30 am EST

• Preliminary Durable Goods Orders for Feb. is estimated to fall -1.0% versus a -.2% decline in Jan.

• Preliminary Durables Ex Transports for Feb. is estimated to fall -.4% versus a +.8% gain in Jan.

• Cap Goods Orders Non-Defense Ex-Air for Feb. is estimated to fall -.4% versus a +1.1% gain in Jan.
  

9:00 am EST

• The FHFA House Price Index MoM for Jan. is estimated to rise +.4% versus a +.6% gain in Dec.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +3,304,270 barrels versus a +1,954,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -1,945,450 barrels versus a -6,180,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,662,360 barrels versus a -2,940,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to fall by -.25% versus unch. prior.

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK PPI report, weekly MBA Mortgage Applications report, Sidoti Investor Conference, CSFB Digital Consumer Retail Conference and the (FISV) investor day could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

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