Morning Market Internals

NYSE Composite Index:

• Volume Running -14.1% Below 100-Day Average
• 7 Sectors Rising, 4 Sectors Declining
• 58.8% of Issues Advancing, 37.8% Declining
• 70 New 52-Week Highs, 9 New Lows
• 46.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 48.7% 
• Bloomberg Global Risk-On/Risk-Off Index 478.0 -34.0 points
• Vix 24.1 +.84%
• Total Put/Call .52 -20.0%
• TRIN/Arms 1.21 +12.0%

Thursday Watch

Evening Headlines

Bloomberg:  

• China Fires Missiles Into Disputed Waterway; U.S. Adds Sanctions.   
• China Increases Key Purchases With U.S. Target Still Far Off.
• Global Cases Pass 24 Million; U.S. Test Criticism: Virus Update.
• Global Stock Rally Stalls in Asia; Dollar Dips. Asian stocks began Thursday’s session mixed as a rally that pushed global equities to a record high showed signs of stalling ahead of a speech from Federal Reserve Chair Jerome Powell. The dollar edged lower. Japanese shares slipped, while those in South Korea and Australia traded flat. Futures on the S&P 500 dipped after a surge in technology shares earlier pushed that index and the Nasdaq Composite to fresh highs for a fourth consecutive day, while the MSCI All-Country World Index climbed to a record. U.S. durable goods orders were more than double estimates, indicating factories will help support the economic rebound in coming months. Treasuries edged up. The offshore yuan traded at the highest since January amid signs of tight liquidity. S&P 500 futures slipped 0.1% as of 9:05 a.m. in Tokyo. The gauge rose 1% on Wednesday. Japan’s Topix index slid 0.3%. South Korea’s Kospi lost 0.3%. Australia’s S&P/ASX 200 Index rose 0.1%.
• Oil Edges Up With Traders Assessing U.S. Gulf Hurricane Impact.
• Fed’s 5-Year Plan, Davos Delayed, Bracing for Impact: Eco Day.  
• Saks Faces Eviction in Miami Over $1.9 Million in Unpaid Rent.
• Trump Says He’s Sending Law Enforcement to Quell Protests in Wisconsin.
• Laura to Be Worst Louisiana Storm in 160 Years: Hurricane Update.
  
• U.S. Commercial-Property Prices Fall With Worst Yet to Come.
  
• Red-Hot Nasdaq 100 Is Threatening to Double Inside of Two Years.
• Coronavirus in Vacant Apartment Suggests Toilets’ Role in Spread.  
• Key Lawmaker Vows to Loosen Big Tech’s ‘Deeply Disturbing’ Grip. 
• Chicago School Board Votes to Renew Contract With City’s Police.

Wall Street Journal:

• The More Important Election.
• Mission Creep at the Fed
• Joe Biden Can’t Restore Normalcy.
• Abbott’s $5 Covid-19 Rapid Antigen Test Gets Emergency-Use Status From FDA.
• Ford Rethinks the Office, Betting Work Will Be Partly Remote Longer-Term.
• Transgender Student Wins Court Ruling on School-Bathroom Use.
  

Fox News:

• Pence to highlight Trump's economic, foreign accomplishments in 'optimistic' speech at RNC night.
• La. gov. predicts Hurricane Laura search, rescue missions by tomorrow.
• Gore suggests military will remove Trump if he doesn't concede.
  

CNBC.com:

• The Fed is expected to use a pandemic era tool to fight a long running battle against low inflation.
• Time to ring the register on part of your position, Jim Cramer says.
• Laura upgraded to Category 4 hurricane, ‘unsurvivable’ storm surge forecast for Texas-Louisiana.
• GOP set to propose smaller coronavirus stimulus bill.
• Jeff Bezos is now worth more than $200 billion.
• Stocks making the biggest moves after hours: NetApp, Williams-Sonoma, Box & more.
• ‘What is the plan?’ NYC restaurant owners plead for clarity on when indoor dining can resume.

MarketWatch.com:         

• Salesforce’s nearly 30% stock rally this week is a possible ‘nightmare’ scenario for the Dow committee.
  
• Box shares surge on better-than-expected results, strong guidance.

Zero Hedge: 

• Marxism Is Coming At Breathtaking Speed - Do This Before It's Too Late.
  
• Everything Changes After Kenosha... "Divided We Stand".
• US Cargo Thefts Erupt As Violent Crime Spreads Across America. 
• Dr. Fauci Worried New CDC Guidelines Are Being "Misinterpreted": Live Updates.  
• New York's MTA Is Losing An Astounding $200 Million Per Week.
• Trump Wants Biden Drug Tested Before First Debate.
• Is Andrew Cuomo Responsible For Thousands Of Nursing Home Deaths? The DoJ Is Trying To Find Out.  
• Milwaukee Bucks Are Refusing To Play Today's NBA Playoff Game In "Protest" For Social Justice.
•  Salesforce Fires 1,000 On Day Its Stock Soars To All Time High.
• Global Stocks Hit Record High, Gold Spikes Ahead Of Powell Speech.

The Epoch Times:

• Faulty Chinese Testing Kits Result in Thousands of Virus False Positives in Sweden.
  

Digital Blackboard:

• Daily New Cases by Region.

Worldometer:

• New Cases/Deaths by state.

Rt Covid-19:

• How fast virus is growing by state.

KFF:

• State Data(Tests/Hospitalizations).

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 62.25 +.25 basis point.

• China Sovereign CDS 35.75 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 60.11 +.03%.
• FTSE 100 futures +.02%.

• S&P 500 futures -.13%.

• NASDAQ 100 futures -.24%.

Morning Preview Links

Earnings of Note 
Company/Estimate

Before the Open:

• (FLWS)/.19
• (ANF)/-.83
• (BURL)/-1.06
• (DG)/2.47
• (DLTR)/.93
• (FRO)/1.02
• (SAFM)/.79
• (TIF)/.17
• (TD)/1.23
  

After the Close:

• (DELL)/1.40
• (GPS)/-.36
• (HPQ)/.43
• (MRVL)/.20
• (OKTA)/-.02
• (OLLI)/.90
• (ULTA)/.16
• (VMW)/1.45
• (WDAY)/.66
  

Economic Releases

8:30 am EST

• Initial Jobless Claims are estimated to fall to 1000K versus 1106K the prior week.
• Continuing Claims are estimated to fall to 14400K versus 14844K prior.
  

10:00 am EST

• Pending Home Sales MoM for July is estimated to rise +2.0% versus a +16.6% gain in June.
  

11:00 am EST

• Kansas City Fed Manufacturing Activity for August is estimated to rise to 5.0 versus 3.0 in July.

Upcoming Splits

• (AAPL)/4-for-1
• (TSLA)/5-for-1
  

Other Potential Market Movers

• The Fed's Powell speaking, Fed's Kaplan speaking, Japan CPI report, weekly Bloomberg Consumer Comfort Index, $47B 7Y T-Note auction and the weekly EIA natural gas inventory report could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

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

 

Stocks Higher into Final Hour on Earnings Optimism, Central Bank Stimulus Hopes, Technical Buying, Tech/Metals & Mining Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Below Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 22.0 unch. 
• Bloomberg Global Risk On/Risk Off Index 567.15 -54.4 points
  

• Euro/Yen Carry Return Index 129.87 -.46%

• Emerging Markets Currency Volatility(VXY) 11.09 +.36%

• S&P 500 Implied Correlation 37.37 -2.5%

• ISE Sentiment Index 130.0 +33.0 points

• Total Put/Call .61 -1.6%

• NYSE Arms .93 -11.4%

Credit Investor Angst:

• North American Investment Grade CDS Index 66.20 +.16%
  

• US Energy High-Yield OAS 764.98 -.26%

• European Financial Sector CDS Index 61.33 -2.6%

• Italian/German 10Y Yld Spread 145.0 +1.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index  62.0 -.05%
  

• Emerging Market CDS Index 180.03 +1.37%
  

• iBoxx Offshore RMB China Corporate High Yield Index 177.50 +.06%

• 2-Year Swap Spread 8.0 +.75 basis point

• TED Spread 13.75 -2.25 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -2.0 -.5 basis point
  
• MBS  5/10 Treasury Spread  90.25 +.75 basis point
  
• IHS Markit CMBX BBB- 6 68.25 unch.

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 60.09 -.15%
• 3-Month T-Bill Yield .10% +1.0 basis point

• Yield Curve 55.0 +4.5 basis points
  

• China Iron Ore Spot 119.45 USD/Metric Tonne -.54%

• Citi US Economic Surprise Index 238.10 +2.7 points

• Citi Eurozone Economic Surprise Index 143.70 -2.9 points

• Citi Emerging Markets Economic Surprise Index 24.9 +.2 point

• 10-Year TIPS Spread 1.73 +3.0 basis points
• 100.0% chance of no change at Nov. 5th meeting, 100.0% chance of no change at Dec. 16th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -10 open in Japan 
• China A50 Futures: Indicating -39 open in China

• DAX Futures: Indicating -39 open in Germany

Portfolio:

• Slightly Higher: On gains in my tech/medical/industrial/consumer staple sector longs
  

• Disclosed Trades: None

• Market Exposure: 50% Net Long

Bear Radar

Style Underperformer:

• Small-Cap Value -1.1%

Sector Underperformers:

• 1) Oil Service-2.5% 2) Airlines -2.3% 3) Healthcare Providers -1.6%

Stocks Falling on Unusual Volume: 

• ITRI, SPAQ, ED, TPVG, ROAD, PINC, OSUR, H, SMG, OPCH, BWXT, LAD, HEI, JWN, CUTR, OTRK, GRWG, KRTX, PSTG and LRN
  

Stocks With Unusual Put Option Activity:

• 1) JWN 2) X 3) ADSK 4) SPLK 5) WDAY
  

Stocks With Most Negative News Mentions:

• 1) REX 2) PINK 3) XOM 4) AAL  5) TEVA
  

Charts:

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

 

Bull Radar

Style Outperformer:

• Large-Cap Growth +1.7%

Sector Outperformers:

• 1) Internet +3.9% 2) Software +3.7% 3) Gold & Silver +2.7%

Stocks Rising on Unusual Volume:

• FLDM, PLAN, CRM, BIGC, CYRX, URBN, SWBI, DKS, TRUP, NFLX, DPHC, HIBB, AYX, WDAY, ADBE, BKU, FB, SPWH and DY
  

Stocks With Unusual Call Option Activity:

• 1) URBN 2) DKS 3) CRM 4) INTU 5) WDAY

Stocks With Most Positive News Mentions:

• 1) CRM 2) ROKU 3) DAKT 4) URBN 5) DKS

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -25.8% Below 100-Day Average
• 4 Sectors Rising, 7 Sectors Declining
• 36.9% of Issues Advancing, 58.9% Declining
• 56 New 52-Week Highs, 7 New Lows
• 47.8% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.8% 
• Bloomberg Global Risk-On/Risk-Off Index 625.0 +45.0 points
• Vix 21.7 -1.5%
• Total Put/Call .63 +1.6%
• TRIN/Arms .77 -26.7%