Tuesday Watch

Evening Headlines

Bloomberg:      

• Myanmar’s Army Chief Challenges Biden, Bets Big on China.  
• Diverging Inflation Paths Shape Asian Central Banks’ Room to Act.
• WHO in Wuhan; Japan to Extend State of Emergency: Virus Update.  
• Asian Stocks Gain After U.S. Rally; Dollar Steady: Markets Wrap.
• Oil Holds Biggest Advance in Three Weeks on Demand Optimism.  
• Inflation Pockets of Asia, Climate Fail, U.S. Recovery: Eco Day.
• Covid Deaths Are Starting to Drop in Every Part of the U.S.
• Robinhood’s Forbidden-Stocks List Saw Price Swings Narrow Monday.  
• Carson Block Suspects Hedge Fund Coordination in Short Squeezes.  
• Apple Sells $14 Billion of Bonds as Share Buybacks Seen Rising.  
• Biden’s GOP Relief Talks Called ‘Productive,’ Will Continue.  
• J&J’s One-Dose Shot Gives U.S. a Chance to Plug Vaccination Gaps.  
• Silver Rally Runs Into Roadblock as Margins Rise, Warnings Mount.  
• Muni-Bond Downgrades Top Upgrades for First Time Since 2014.

Wall Street Journal:

• Catholic Schools Are Beating Covid.
• Officer Who Shot Capitol Rioter Shouldn’t Be Charged, Investigators Say.
• Covid-19’s Effects May Linger in Your Body, Even After Asymptomatic Cases.
• Covid Wears on, Essential Workers Carry on: ‘Everybody Forgets You’re Still on the Front Line’.
• Covid-19 Vaccines to Stress-Test Grocery Stores and Pharmacies.
• Exxon to Create ‘Low Carbon’ Business Unit as It Faces Activists.

Fox News:   

• Money talks as Biden pushes green industry's agenda.
  
• Deputy State Dept. spox called police 'largest threat' to national security.
  
• NEWT GINGRICH: Biden says 'unity' but really means 'conformity' – what the real deal would look like.
  

CNBC.com:

• GameStop’s slide continues, down 16% in after-hours trading.
• Amazon, Alphabet and Salesforce are all investing in a $28 billion company that crunches big data.
• Fed’s Bostic says economy could recover more quickly than expected.
• SpaceX to fly first civilian crew to space later this year, with public competitions for two seats.
• Stocks making the biggest moves after hours: Virgin Galactic, GameStop, Cirrus Logic and more.
• Why the GameStop frenzy may hurt retirees along with hedge funds.

MarketWatch.com:     

• AMC Entertainment stock now a ‘sell’ at MKM, as price target drops to $1.  
• Fed’s Kashkari not ‘fazed’ by rush of stock market speculation.  
• Tesla is in decline, SUVs are king, and more insights from the world’s largest electric-vehicle market.  
• GameStop stock tumbles 30% after more than half of short positions eliminated.

Zero Hedge:

• US COVID Vaccinations Top Cases For First Time... But A Majority Of Americans Still Remain Skeptical.
• How FinTech F**ked Financial Market Structure, Exposed The Social Contract, & What Comes Next.
• Financial Services Committee To Hold GameStop Hearing On Feb 18.
• Steve Cohen Opens Fund To New Investor Cash After Losses From Melvin Capital Bailout.
• Carson Block Defends Short Selling, Says He's "Not Part Of The Establishment".
• CME Hikes Silver Margins By 18%: Paper-Physical Disconnect Set To Explode.
• Treasury Now Projects Borrowing $900 Billion Less This Quarter: What That Means For Markets.
• Morgan Stanley: "This Correction Has Arrived And It's Likely To Get Worse And Feel Bad".
  
• Showdown In Chicago As Teachers Defy Mayor's Orders, Ignore Science; Strike Imminent.
• Short-Squeeze Stampede Sends Silver Soaring; Stocks Surge Off Overnight Slump.

Newsmax: 

• Dems Move to Pass $1.9 Trillion Bill Without GOP Support.
• Cotton: Biden's Immigration Orders Will Have 'Sweeping Effect'.
• Biden Asks Supreme Court to Cancel Asylum, Border Wall Arguments.
• US May Delay Afghanistan Withdrawal Amid Violence.

TheGatewayPundit.com:

• BREAKING: Democrat Pennsylvania Secretary of State at Center of Trump Election Concerns Resigns After Botching Requirement for Constitutional Amendment.
• As We Predicted: Non-Voters and Registered Democrats were Among Those Arrested at US Capitol Riots.
• Chris Salcedo Runs Montage of Democrats Threatening Violence Against Trump — But Trump Is Being “Impeached” for Calling for Peaceful Protest? (VIDEO).
• DC Public Schools Using Black Lives Matter Curriculum That Prioritizes ‘Disrupting the Nuclear Family’.
• Dr. Shiva, Jovan Pulitzer and Others Join World View Weekend and Discuss Steps Going Forward to Uncover the Accurate Results of the 2020 Election.
• Michigan’s Governor Aids CNN In Propaganda Campaign To Label Dissenters Of Democrat Party’s Radical Agenda, “Domestic Terrorists” [VIDEO].
• MEDIA BLACKOUT: Antifa Terrorists Armed with Hatchets Take Over Red Lion Hotel in Olympia, WA – Occupy 17 Rooms, Demand Shelter For Homeless (VIDEO).
• Biden White House OUTRAGED After Burmese Military Arrests Country’s Leaders over Alleged November Voter Fraud.
• Stacy Abrams Nominated for Nobel Peace Prize for Overwhelming Georgia Elections System with Questionable Ballots.

The Epoch Times: 

• Majority of Residents in Shanghai District Refuse to Take Chinese COVID-19 Vaccine: Govt Survey.
• Pentagon Commits $30 Million to Texas Rare Earth Plant, Aims to Reduce Reliance on China.
• Secretary of State Blinken Says US Should Allow in Hong Kong Refugees Fleeing Beijing’s Repression.

HereIsTheEvidence.com:

• This is for aggregating publicly available items of voter fraud evidence in the US election that would be admissible in court.
  

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 +1.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 61.75 -.25 basis point.

• China Sovereign CDS 31.0 -.75 basis point.

• Bloomberg Emerging Markets Currency Index 62.23 +.03%.
• Bloomberg Global Risk-On/Risk Off Index 1,476.0 +59.0 points.
• Volatility Index(VIX) futures 31.07 +.14%.
• FTSE 100 futures unch.

• S&P 500 futures +.01%.

• NASDAQ 100 futures +.12%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AMG)/3.68
• (CNA)/1.00
• (ENR)/.89
• (GPN)/1.77
• (HAS)/1.14
  

After the Close:

• (CHGG)/.41
  
• (LEG)/.70
  
• (SPG)/2.24
  
• (TTWO)/.94
  

Economic Releases

Afternoon

• Wards Total Vehicle Sales for Jan. is estimated to fall to 16.15M versus 16.27M in Dec.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone GDP report, China PMI report and the US weekly retail sales reports could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and commodity shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 75% net long heading into the day.

Stocks Substantially Higher into Final Hour on Stimulus Hopes, Vaccine Optimism, Oil Gain, Tech/Financial 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) 29.2 -11.8%
• Bloomberg Global Risk On/Risk Off Index 1,518.0 +375.0 points

• Euro/Yen Carry Return Index 131.07 -.36%

• Emerging Markets Currency Volatility(VXY) 10.44 +.77%

• S&P 500 Implied Correlation 51.9 -4.1%

• ISE Sentiment Index 131.0 +23.0 points
  

• Total Put/Call .75 -19.4%

• NYSE Arms .75 -37.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 54.55 -2.6%
  

• US Energy High-Yield OAS 519.31 -.52%

• European Financial Sector CDS Index 62.23 -1.7%

• Italian/German 10Y Yld Spread 116.0 -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 62.60 +.1%
  

• Emerging Market CDS Index 173.40 -1.08%
  

• iBoxx Offshore RMB China Corporate High Yield Index 185.51 -.03%

• 2-Year Swap Spread 7.75 -.25 basis point

• TED Spread 15.5 -.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -5.0 -.5 basis point
  
• MBS  5/10 Treasury Spread  68.75 +.75 basis point
  
• IHS Markit CMBX BBB- 6 73.75 +.75 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 62.22 +.21%
• 3-Month T-Bill Yield .05% unch.
  

• Yield Curve 96.25 +3.25 basis points
  

• China Iron Ore Spot 149.75 USD/Metric Tonne 4.12%

• Citi US Economic Surprise Index 60.60 -4.7 points

• Citi Eurozone Economic Surprise Index 124.0 -4.2 points
  

• Citi Emerging Markets Economic Surprise Index 63.80 -1.6 points

• 10-Year TIPS Spread 2.09 -3.0 basis points
• 100.0% chance of no change at April 28th meeting, 100.0% chance of no change at June 16th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +164 open in Japan 
• China A50 Futures: Indicating -69 open in China

• DAX Futures: Indicating +35 open in Germany

Portfolio:

• Higher: On gains in my energy/tech/industrial/biotech/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 Value +1.0%

Sector Underperformers:

• 1) Retail -4.9% 2) Pharma +.1% 3) Foods +.4%

Stocks Falling on Unusual Volume: 

• GRTS, WSM, BDTX, MRTX, BPMP, CONN, ACAD, RXT, PVH, COLL, STIM, CHRS, WW, EVLO, SKT, SEET, SHLX, TR, GOGO, DD, CRTX, SPWR, MRNA, SFIX, PETS, FIZZ, GME and KOSS
  

Stocks With Unusual Put Option Activity:

• 1) DISCA 2) HOG 3) DD 4) SWKS 5) SLV
  

Stocks With Most Negative News Mentions:

• 1) TRIT 2) SFIX 3) EXPR 4) BTBT 5) WSM
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +2.3%

Sector Outperformers:

• 1) Gold & Silver +5.0% 2) Video Gaming +3.4% 3) Networking +3.2%

Stocks Rising on Unusual Volume:

• THCB, INO, BCRX, RVP, VXRT, STPK, FLGT, GATO, FUBO, UAVS, NVAX, CDE, GPRO, SRNE, SPCE, CDMO, INAQ, HIMS, XONE, IFF, CVLB, SUM, CREE, IRTC, CODX, CCIV, NKTR, FPI, SWKS, XRX, IPOE, NESR, AMC, PSAC, SPFR, IPOD, PSAC and IBKR
  

Stocks With Unusual Call Option Activity:

• 1) SUM 2) DVAX 3) TPX 4) RVP 5) BCRX

Stocks With Most Positive News Mentions:

• 1) ARQT 2) FIS 3) CMG 4) TMO 5) EXPE
  

Charts:

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

Morning Market Internals

 NYSE Composite Index:

• Volume Running +33.2% Above 100-Day Average 
• 8 Sectors Rising, 3 Sectors Declining
• 59.7% of Issues Advancing, 38.0% Declining
• 50 New 52-Week Highs, 2 New Lows
• 81.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 43.5% 
• Bloomberg Global Risk-On/Risk-Off Index 1,299.0 +155.0 points
• Vix 31.9 -3.7%
• Total Put/Call .69 -25.8%
• TRIN/Arms 1.14 -5.8%

Monday Watch

Today's Headlines

Bloomberg: 

• Virus Controls Undercut China’s Holidays, Economic Recovery.   
• Australia Central Bank Faces Taper Quandary as Peers Stand Pat. 
• U.K. Businesses Call for Clear Roadmap to Reopening the Economy.
• Governments Exploit Covid Data for Other Uses, Risking Backlash.
• Myanmar’s Suu Kyi Detained, Her Party Says Army Stages ‘Coup’.
  
• Cases Slow Across Globe; Variant Worries Remain: Virus Update.  
  
• U.S. Stock Futures Slide; Silver Contracts Surge: Markets Wrap.
• Dubai Stocks Lead Gulf Selloff Amid Travel Curbs: Inside EM.
• Oil Drops Below $52 as Virus Resurgence Weighs on Demand Outlook. 
• Biden’s First U.S. Jobs Report to Show Challenge Ahead: Eco Week.
• OPEC+ Sees Almost Full Compliance With January Oil-Supply Cuts.
• The Reddit Army Bailout: Desperate Companies Get New Lifelines.
• Biden Health Adviser Warns of Virus Variants, Future Lockdowns.   
• ‘Trillion Dollar’ Mt. Gox Demise as Told by a Bitcoin Insider.  
• Silver Retail Sites Grind to Halt as Reddit Horde Moves to Coins.

Wall Street Journal:

• Behind the Bitcoin Bubble.
• Investors Consider Next Move as Signs of a Bubble Mount.
• Lockdowns Spur Shift to High-End Liquor.

Fox News:

• Biden adviser shrugs off concerns about jamming through massive stimulus package.
• Doctor issues new warning about COVID vaccines and evolving virus.

CNBC: 

• GameStop mayhem hits close to home for co-founder’s son, who’s active on WallStreetBets.
• It’s likely going to take a constant stream of excited buyers to keep the GameStop, AMC rally going.
• Russia arrests over 4,500 at nationwide protests backing jailed Putin critic Navalny.
• Hedge fund billionaire Steve Cohen leaves Twitter after family receives threats amid GameStop backlash.
• Robinhood to continue trading limits on Monday, customers can still only buy one GameStop share.
• Melvin Capital, hedge fund that bet against GameStop, lost more than 50% in January.
  

Zero Hedge: 

• Lincoln Project Denounces Co-Founder After Allegations Of Pedophilia, Sexually Provocative Messages To 21 Young Men.
• Silver Futures Soar 8%, Rise Above $29 As Reddit Hordes Pile In.
• Make Standard Oil Great Again: Exxon, Chevron Have Discussed A Merger.
• Ray Dalio: Recent Market "Rebellion" Shows Growing "Anger" And "Intolerance" In U.S.
• Why Hasn't The House Held Hearings To Establish "Incitement To Insurrection"?
• This Is The Stunning Way Some Desperate Funds Covered Their Gamestop Shorts.
• Religious Books Seized And Burned In Communist China, 'Believers' Given Jail Terms.
• "Everyone Is Afraid Ahead Of The Open" - Reddit-Raiders Spark Nationwide Physical Silver Shortage.
• GOP Senators Offer $600 Billion Compromise For COVID Relief.
• "So You Just 'Raided' Your First Company" - A Letter To Non-Professional Traders.
• Reddit Outages Reported As r/WallStreetBets Experiences Surge In Web Traffic.
• The Stock Market, Fatally Wounded By The Truth, Will Stumble And Crash.
• "Biggest Storm In 5 Years?!" - More Than A Foot Of Snow Could Blanket Northeast.
• Melvin Capital Lost A Stunning $7 Billion In January, 53% Of Its Capital; Here's How Everyone Else Did.
• Gordon Johnson: Tesla Lost Money Selling Cars For The Fourth Straight Quarter.
• Stimulus Checks Helped Fuel GameStop Stock Surge: Billionaire Gundlach.
• Extremely high fear.
• Only You Can Beat Big Tech Censorship.
• WHO Team 'Tightly Controlled' By CCP During COVID-19 Origins Investigation.
• 'Black Lives Matter' Nominated For The Nobel Peace Prize.
• Caveat Emptor - Are You A WSB 'Useful Idiot'?
• Virginia Task Force Drops Gang Database After Complaints It Has Too Many Minorities In It.

NewsMax: 

• GOP Senators Counter Biden Stimulus With $600 Billion Plan.  
• John Catsimatidis: Biden Moves Hurt Low-Wage Americans.
• Sen. Blackburn: Biden 'Giving Favors to China, Restricting Our Freedoms'.

TheGatewayPundit.com:

• Perfect. Kamala Harris Tells Unemployed Coal Miners That After Biden Kills Their Jobs They Should Work Reclaiming Abandoned “Land Mines” (VIDEO).
• Americans Learn Those Involved in the Russia Collusion Coup Will Walk Confirming The Evolution of the Deep State and the Two Tiered Justice System.
• Unity: Biden White House Fired Trump Officials in Pentagon Who Were Out on Maternity and Paternity Leave (VIDEO).
• Biden KILLS Trump Order Expanding Access To Opioid Abuse Treatment.
• SNL Runs Disgusting Hit Piece on Mike Lindell, Mocks Him for Previous Drug Addiction and His Support for Donald Trump (VIDEO).
• Never Trump Lincoln Project Co-Founder John Weaver Busted For Grooming Underage Teen Boys – Lincoln Project Responds.
• A Miracle! Only 23 Americans Tested Positive for Flu Last Week Compared to 14,657 Cases Reported Last Year at Same Time.
• Bill Gates Surprised Over “Crazy Conspiracy Theories” About Him and Dr. Fauci — Blames Social Media Companies and Not His Creepy Ideas.
• Note to Arizona Senate from a Former International Audit Executive: If Audit Resources are Limited – FOCUS ON THE BALLOTS.
• Rep. Elise Stefanik Calls for Federal Investigation on Criminal Acts Committed by Gov. Cuomo in COVID Nursing Home Scandal (VIDEO).
• Five of Trump’s Impeachment Lawyers Leave Defense Team 9 Days Before Senate Trial.
• Rapper Tom MacDonald’s “Fake Woke” that RIPS Cancel Culture Reaches #1 on Hip-Hop, Rap and All-Genre US iTunes Song Sales.

The Epoch Times:

• US Can Draw Lessons From Taiwan on Fighting China’s Disinformation: Report.
• Popular Fertility App Sued Over Allegedly Sharing Personal Data With Chinese Firms.

HereIsTheEvidence.com:

• This is for aggregating publicly available items of voter fraud evidence in the US election that would be admissible in court.

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 indices are -.5% to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 63.5 +2.25 basis points.
• China Sovereign CDS 32.50 +.75 basis point.
• Bloomberg Emerging Markets Currency Index 62.15 +.11%.
• Bloomberg Global Risk-On/Risk Off Index 1,178.0 +34.0 points.
• Volatility Index(VIX) futures 32.55 +.40%. 
• Euro Stoxx 50 futures -.17%.
• S&P 500 futures -56%.
• NASDAQ 100 futures -.71%.

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (ON)/.28
• (TMO)/3.88
• (OTIS)/.59
  

After the Close:

• (CRUS)/1.86
• (FN)/1.04
• (KMT)/.09
• (NXPI)/2.11
• (VRTX)/2.58
  

Economic Releases

10:00 am EST

• Construction Spending MoM for Dec. is estimated to rise +.8% versus a +.9% gain in Nov.
• ISM Manufacturing for Jan. is estimated to fall to 60.0 versus 60.7 in Dec.
• ISM Prices Paid for Jan. is estimated to fall to 76.0 versus 77.6 in Dec.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone PMI report and the RBA rate decision could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are mostly higher, boosted by metals & mining and technology 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 week.