Stocks Surging into Final Hour on Global Stimulus Hopes, Diminishing Coronavirus Fears, Short-Covering, Retail/Financial Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 33.2 -7.7%

• Euro/Yen Carry Return Index 120.48 -.20%

• Emerging Markets Currency Volatility(VXY) 11.99 -1.7%

• S&P 500 Implied Correlation 68.7 -5.3%

• ISE Sentiment Index 72.0 +1.0 point
  

• Total Put/Call 1.03 +1.98%

• NYSE Arms .75 -31.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 92.06 -1.84%
  

• America Energy Sector High-Yield CDS Index 882.0 unch.

• European Financial Sector CDS Index 102.27 -7.01%

• Italian/German 10Y Yld Spread 221.25 -10.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 122.0 -1.39%
  

• Emerging Market CDS Index 366.69 unch.
  

• iBoxx Offshore RMB China Corporate High Yield Index 164.67 -.35%

• 2-Year Swap Spread 15.5 -1.0 basis point

• TED Spread 79.0 -13.0 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap 22.25 -8.25 basis points
• MBS  5/10 Treasury Spread  123.0 -6.0 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 57.70 -.02%
• 3-Month T-Bill Yield .10% unch.

• Yield Curve 39.75 +2.75 basis points

• China Iron Ore Spot 81.08 USD/Metric Tonne -.31%

• Citi US Economic Surprise Index -103.70 -1.9 points

• Citi Eurozone Economic Surprise Index -213.90 +6.2 points

• Citi Emerging Markets Economic Surprise Index 4.4 +4.6 points

• 10-Year TIPS Spread 1.17 +6.0 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 +72 open in Japan 
• China A50 Futures: Indicating +67 open in China

• DAX Futures: Indicating +17 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 75% Net Long

Bear Radar

Style Underperformer:

• Large-Cap Growth +1.0%

Sector Underperformers:

• 1) Oil Service -.6% 2) Gold & Silver -.3% 3) Software +.4%

Stocks Falling on Unusual Volume: 

• XRX, EHTH, CATS, ARCH, APA, BYND and EGOV

Stocks With Unusual Put Option Activity:

• 1)  AXSM 2) HOG 3) INO 4) KWEB 5) ATUS

Stocks With Most Negative News Mentions:

• 1) COTY 2) XOM 3) CAT 4) GILD 5) LK

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +4.2%

Sector Outperformers:

• 1) Gaming +8.3% 2) Education +7.0% 3) Retail +5.0%

Stocks Rising on Unusual Volume:

• REAL, ARCT, CMD, AXSM, MAG, SEAS, MCRI, ERI, SNBR, ELY, TBIO, OSTK, W, LVS, WSM, VTIQ, DSSI, INSW, DGX, LH, IAA, EBS, ZM and DKL

Stocks With Unusual Call Option Activity:

• 1) VSTM 2) FCEL 3) DVAX 4) USL 5) BBBY

Stocks With Most Positive News Mentions:

• 1) ASXM 2) BIG 3) NAT 4) AVDL 5) AUDC

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +14.0% Above 100-Day Average
• 11 Sectors Rising, 0 Sectors Declining
• 76.5% of Issues Advancing, 22.2% Declining
• 25 New 52-Week Highs, 8 New Lows
• 10.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 46.8%
• Vix 32.7 -9.1%
• Total Put/Call .99 -2.0%
• TRIN/Arms 1.09 unch.

Monday Watch

Today's Headlines

Bloomberg:      

• Singapore Becomes Asia’s Most Infected Nation After China, India.

• Bank of China Clients Said to Have $1 Billion Losses on Oil Bet.    

• Kim Jong Un Mystery Grows on Reports of Train, Medical Team.

• Airbus CEO Warns Workers It’s Bleeding Cash and Cuts Are Needed.   

• U.K. Market-Rigging Reports Rise as Virus Poses Another Threat.

• Saudi Arabia Cuts $265 Million Deal With China to Fight Virus.  

• World Is Running Out of Russian Wheat When Some Want it Most.  

• Deutsche Bank Says Results Will Beat Market Expectations. 

• U.S. Stock Futures Dip; Yen Steady Before BOJ: Markets Wrap. U.S. stock futures dipped early Monday as investors weighed further signs of positive developments in the global fight against the coronavirus. The yen was steady as traders awaited a key Bank of Japan policy meeting. Asian equity futures rose, following a move higher for U.S. stocks on Friday. The Australian dollar erased early modest losses to trade higher, while moves were muted elsewhere across foreign-exchange markets. Coronavirus deaths slowed the most in more than a month in Spain, Italy and France while fatalities reported in the U.K. and New York were the lowest since the end of March. Oil dipped. Futures on the S&P 500 fell 0.2% as of 7:11 a.m. in Tokyo. The gauge added 1.4% on Friday. Futures on Japan’s Nikkei 225 advanced 0.2%. Hong Kong’s Hang Seng Index futures added 0.6%on Friday, when futures on Australia’s S&P/ASX 200 Index gained 1.6%.

• Middle Eastern Stocks Climb as States Start to Ease Virus Curbs.

• The Next Chapter of the Oil Crisis: The Industry Shuts Down.

• Cuomo Announces Phased Plan to Reopen New York; Deaths Drop

• How Coronavirus Will Forever Change Airlines and the Way We Fly.

• Bond Investors Start to Debate Whether U.S. Is Heading Into Deflationary Spiral.

• Wisconsin Beef Plant Shuts Down for Virus Adding to Meat Squeeze.

• Diamond Offshore Files for Bankruptcy Amid Historic Crude Crash.

Wall Street Journal: 

• U.S. Debates How Soon It Can Reopen.

• Farmers Forced to Destroy Their Crops.

• More Countries Take Measures to Reopen Parts of Daily Life.

• Schiff’s Secret Transcripts.

• Mnuchin Sees Third-Quarter Rebound for U.S. Economy.

• Virus Disrupted Supply Chains That Companies Are Still Fixing.

• Markets Diverge in Assessing the Economic Freeze.

• Private-Equity-Owned Hospital Faced Closure As Cases Mounted.

• America Needs to Win the Coronavirus Vaccine Race.

• The Era of Big Government Is…Back.

• People Were Leaving New York City Before. Now What?

• How Fed Intervention Saved Carnival.

• Virus Accelerates J.C. Penney’s Long March Toward Bankruptcy.

Fox News:

• Sunday hosts fail to ask Dem's potential running mates about bombshell sex-assault claim.

• EXCLUSIVE: Biden accuser blasts CNN’s Cooper, others for not asking ex-VP about her claims.

• CNN video linked to claim against Biden vanishes from Google Play.

• With Kim’s health uncertain, focus shifts to powerful sister.

• Top House Republican says 'WHO' should really stand for this.

CNBC: 

• Sports arenas could require ‘necessary renovations’ for social distancing, architect firm says.

• White House economic advisor Kevin Hassett says unemployment rate will approach Great Depression.

• Coronavirus live updates: US cases top 900,000, Birx says social distancing will last through summer.

• Coronavirus live updates: Dr. Birx says US needs a ‘breakthrough’ on testing to aid re-opening.

• Economic damage from the coronavirus is hitting the lowest level of wage earners hardest.

• Public companies took far more federal small business loans than first thought.

• Why oil prices went negative and why they can go negative again.

Zero Hedge:        

• Whisteblowing ER Docs Urge "Open Up Society Now" Because "Lockdowns Are Weakening Our Immune Systems".

• Coronavirus Deaths Likely 60% Higher Than Official Numbers Reflect, FT Finds.

• TED's Not Dead Because Jay Don't Pay, Just Like Ben Couldn't Then.

• Global Coronavirus Deaths Slow For 4th Straight Day: Live Updates.

• "China Did A Lot Of Things Right": Bill Gates Defends CCP, Slams America Over Handling Of Coronavirus.

• Does Elon Musk Risk Becoming A Chinese Government Asset?

• National Guard Deployed At Nation's Food Banks To Ensure Stability During Unprecedented Times .

• Wave Of Repos Imminent As Subprime Auto-Buyers Miss Payments.

• Goldman Sees Imminent "Momentum" Crash As All S&P Gains Come From Just 5 Stocks.

• Scientists Find More Evidence Novel Coronavirus Can Travel On Air Pollution Particles.

• Small Businesses In Catch-22 Begin Revolt: 'Defy State's Stay-At-Home Order Or Face Collections'.

• Chinese Company Suspected Of Spying On US Citizens Donates Police Drones To 22 States.

• China Continues To Flood The World With Defective Medical Supplies.

• The COVID-19 Crisis Is Driving The EU To The Brink.

• Panic Hoarding, Trains Halted & Low-Flying Helicopters In Pyongyang Amid Conflicting Kim Death Rumors.

• North Korea's Kim Jong Un Reported By Japanese Media To Be In Vegetative State.

• After Decades Of Brainwashing, MSM & Governments Are Losing Control Of The People.

• American Farms Cull Millions Of Chickens Amid Virus-Related Staff Shortages At Processing Plants.

• Will China Use Economic Insecurity To Buy Up Stakes In US & Europe?

• Pandemic Exposes Liberalism's Free Trade, Open Borders Road To National Suicide.

• Unprecedented Pace Of Corporate Debt Issuance Has Crippled Corporate Fundamentals.

• Visualizing How COVID-19 Has Impacted Media Consumption, By Generation.

• Twitter CEO Unveils Feature To "Editorialize" Trump's Tweets As Election Looms.

• Goldman Was Furiously Buying Mortgage Bonds In The Days Before The Fed's Massive Bailout.

Business Insider:

• The $600 federal boost to unemployment checks that was meant to aid struggling families is triggering confusion: some people are now earning more in unemployment than they were while working.

• US and South Korean spies do not believe that Kim Jong Un is dead, after satellites pictured his train at an elite coastal resort.

John Hopkins University:

• Coronavirus Global Cases. (map)

BNO News:

• Tracking coronavirus: Map, data and timeline.

Google Docs:

• Coronavirus Testing by State.

Night Trading

• Asian indices are unch. to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 123.75 -.5 basis point.

• China Sovereign CDS 51.25 -.5 basis point.

• Bloomberg Emerging Markets Currency Index 57.70 -.02%.

• FTSE 100 futures +.4%.

• S&P 500 futures -.44%.

• NASDAQ 100 futures -.27%.

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (AMG)/3.09

• (CHKP)/1.38

• (SOHU)/-.70

After the Close:

• (BRO)/.46

• (CGNX)/.08

• (CR)/1.26

• (FFIV)/1.99

• (KDP)/.27

• (NXPI)/1.40

• (PPG)/1.17

Economic Releases
10:30 am EST

• The Dallas Fed Manufacturing Activity Index for April is estimated at -75.0 versus -70.0 in March.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Japan Jobless Rate could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are modestly higher, boosted by technology and consumer staple 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 week.

Weekly Outlook

• Wall St. Week Ahead by Reuters.

• The Week Ahead by Yahoo. (video)

• Stocks to Watch Next Week by Seeking Alpha.

• Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week mixed as earnings jitters, global recession fears and oil weakness offset global stimulus hopes, short-covering and diminishing coronavirus worries. My intermediate-term trading indicators are giving bearish signals and the Portfolio is 50% net long heading into the week.