Stocks Surging into Afternoon on Stable Long-Term Rates, Oil Gain, Dollar Weakness, Tech/Gaming Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 18.8 -6.8%
• Bloomberg Global Risk On/Risk Off Index 3,251.0 +111.0 points

• Euro/Yen Carry Return Index 137.31 +.14%

• Emerging Markets Currency Volatility(VXY) 9.1 +1.1%

• S&P 500 Implied Correlation 49.7 -5.8%

• ISE Sentiment Index 132.0  +25.0 points
  

• Total Put/Call .78 -7.1%

• NYSE Arms 1.01 -7.3%

Credit Investor Angst:

• North American Investment Grade CDS Index 51.88 -.95%
  

• US Energy High-Yield OAS 438.25 +.09%

• European Financial Sector CDS Index 60.15 -1.55%

• Italian/German 10Y Yld Spread 117.0 +1.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 87.90 -1.98%
  

• Emerging Market CDS Index 161.05 -1.5%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 39.40 +.25%

• 2-Year Swap Spread 8.75 -.75 basis point

• TED Spread 15.0 -.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -1.5 -.25 basis point
  
• MBS  5/10 Treasury Spread  62.0 -1.0 basis point
  
• IHS Markit CMBX BBB- 6 71.75 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.31 +.11%
• 3-Month T-Bill Yield .01% +1.0 basis point
  

• Yield Curve 147.0 -1.0 basis point
  

• China Iron Ore Spot 185.0 USD/Metric Tonne -1.0%

• Citi US Economic Surprise Index 11.3 -3.4 points

• Citi Eurozone Economic Surprise Index 136.20 -5.9 points
  

• Citi Emerging Markets Economic Surprise Index 53.2 -2.9 points

• 10-Year TIPS Spread 2.45 -1.0 basis point
• 93.0% chance of no change at Sept. 22nd meeting, 91.0% chance of no change at Nov. 3rd meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +146 open in Japan 
• China A50 Futures: Indicating +36 open in China

• DAX Futures: Indicating +144 open in Germany

Portfolio:

• Higher: On gains in my medical/tech/industrial/commodity sector longs and emerging market shorts
  

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

• Market Exposure: Moved to 100% Net Long
  

Bear Radar

 Style Underperformer:

• Small-Cap Value +.2%

Sector Underperformers:

• 1) Education -1.9% 2) Alt Energy -1.0% 3) Biotech -.3%

Stocks Falling on Unusual Volume: 

• VVNT, AKRO, FF, COG, QS and XEC
  

Stocks With Unusual Put Option Activity:

• 1) SPCE 2) ATOS 3) DDD 4) COG 5) CVM
  

Stocks With Most Negative News Mentions:

• 1) COE 2) GOTU 3) DG 4) TAL 5) DDD
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +1.5%

Sector Outperformers:

• 1) Gaming +3.2% 2) Semis +2.4% 3) Internet +1.9%

Stocks Rising on Unusual Volume:

• SPCE, AMC, BYND, GAN, AGS, RBLX, FLL, DXCM, SPT, PLCE, NVDA, CVLT, PTGX, RETA, KSS and LAZR
  

Stocks With Unusual Call Option Activity:

• 1) RRD 2) BSX 3) DVAX 4) TEN 5) HRB

Stocks With Most Positive News Mentions:

• 1) VRTV 2) VSTM 3) APM 4) SPCE 5) ZS
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -25.1% Below 100-Day Average 
• 10 Sectors Rising, 1 Sector Declining
• 63.3% of Issues Advancing, 32.9% Declining
• 152 New 52-Week Highs, 18 New Lows
• 87.5% of Issues Above 200-day Moving Average
• Average 14-Day RSI 50.6%
  
• Bloomberg Global Risk-On/Risk-Off Index 3,240.0 +101.0 points
• Vix 19.0-6.0%
• Total Put/Call .76 -9.5%
• TRIN/Arms 1.28 +17.4%

Monday Watch

Today's Headlines

Bloomberg:                

• Europe Outraged as Belarus Forces Ryanair Jet to Land in Minsk.  
• China Braces for $1.3 Trillion Maturity Wall as Defaults Surge.  
• First Warning Sign in the Global Commodity Boom Flashes in China.
• Global Rebound Euphoria Tests Central Bankers’ Nerves on Risk.    
• Commodity ‘Supercycle’ a Cue for Saudi State Miner to Cut Debt.
• U.S. Outbreak Slows as Concern Rises Over Variant: Virus Update.  
• U.S. Futures Waver; Crypto, Commodities in Focus: Markets Wrap.
• Oil Trades Near $64 as Investors Track Virus Fight, Iran Talks. 
• Five Things You Need to Know to Start Your Day.
• Cathie Wood Is Trimming Her Biggest Stakes as Ark Funds Stumble.  
• GOP Balks on Spending Plan as Biden Aide Rules Out Inaction.  
• NYC to Boost Police Presence in Jewish Communities, Mayor Says.  
• Solar Power's Decade of Falling Costs Is Thrown Into Reverse.

Wall Street Journal:

• World Crises Crash Biden’s Home-Front Agenda.
• For Startup Leaders, SPACs Lose Their Allure.
• Scammers and Fraudsters From Sea to Shining Sea.
• Back to Iran’s Nuclear Future.
• The Trouble With Biden’s ‘Green Bank’.
• Inflation Worries Force Investors to Hunt for Solutions.  
• Economy Week Ahead: Housing, Consumer Spending, Inflation.

Fox News:

• Obama accused of sucking Dems dry and it only gets worse from there.
• Dem mayor in city with highest murder rate is making new shocking move.

CNBC:  

• Robert Shiller: ‘Wild west’ mentality is gripping housing, stocks and crypto.
• It’s not your imagination. Rising airfares and hotel rates are making vacations more expensive.
• Senators reach bipartisan agreement on $300 billion for highways, roads and bridges.
• Bitcoin resumes sell-off over weekend, falls below $32,000.
• The crypto collapse: Here’s what’s behind bitcoin’s sudden drop.
• U.S. Covid cases hit lowest level since June as nation looks toward Memorial Day, summer travel.
• Wall Street’s best-performing analysts say investors should keep buying these stocks.

Zero Hedge: 

• Fauci Finally Admits COVID-19 May Have Come From Wuhan Lab, 'Not Convinced' Of Natural Origin.
• "In Human History, No Single Asset Has Come Under Such Coordinated Assault By Global Institutions".
• Rand Paul First Senator To Announce He Won't Get COVID-19 Vaccine.
• Goldman Lists The Three "Gray Rhinos" Haunting The Market.
• How Hard Will Biden Press For A Probe Of Wuhan Knowing That A Lab Leak Will Require Political Response.
• "Air's Coming Out Of The Balloon" - Redfin CEO Says Home Price Gains Set To Cool.
• Apples-to-Apples, Consumer Price Inflation Is Nearing 1970-Type Numbers.
• Wuhan Lab Workers Were 'So Sick They Sought Hospitalization' According To US Intelligence.
• Morgan Stanley: Here Are The 4 "Worries" That Will Dominate The Next 6-12 Months.
• Study Finds 4.5% Of All Bitcoin Mining Is In Sanctions-Hit Iran.
• Iran Blocks Inspectors From Accessing Nuclear Site Images As Vienna Deal Looms.
• Fed Prepares To Go Direct With Liquidity.
• Chinese Cryptoexchange Huobi Suspends Some Services, Stops Miner Hosting Services.
• Chicago Cops Issue No-Confidence Vote In Mayor After Anti-White Racism.
• Crypto Continues Crashing - 5 Lessons From Bitcoin's Very Bad Week.
• DeSantis On Critical Race Theory: "Offensive" To Expect Taxpayers To Pay To Teach Kids To "Hate Their Country".

MarketWatch.com: 

• Bitcoin prices tumble 50% from peak and Mark Cuban calls the crypto crash the ‘great unwind'.
• Amid bitcoin and dogecoin chaos, college students and graduates insist they’re going long on crypto.
  
• If it’s not enhanced unemployment benefits, why are people turning down jobs?  
• Colleges turned to software to catch cheaters during the pandemic — so why are some schools banning it?
  

NewsMax:    

• CDC Looking Into Heart Inflammation in Some Young Vaccine Recipients.

TheGatewayPundit.com:

• HUGE! — RAT IN A TRAP: Fauci Admits COVID May Have Been from a Lab — ADMITS TO FUNDING CHINESE LABS! (VIDEO).
• “A Lot of These So-Called Experts – Are Trying to Cover Their Tracks. This could be a Genuine Scandal” – Sen. Tom Cotton DROPS A BOMB on Fauci and His Wuhan Research Funding (VIDEO).
• Support for Black Lives Matter Has Absolutely Plummeted Since Last Summer’s Riots.
• Arizona Rep. Finchem: Democrats “Scared to Death” of Actual Ballot Counts – What Actually Scares Them Is “Physical Ballot Count Compared to What Dominion Put On Their Machines”.

The Epoch Times:

• Chinese Companies Facing Largest Wave of Dollar Debt Maturities in History.

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 -.25% to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 89.25 -.5 basis point.
• China Sovereign CDS 39.75 +.25 basis point.
• Bloomberg Emerging Markets Currency Index 61.23 -.01%.
• Bloomberg Global Risk-On/Risk Off Index 3,145.0 +18.0 points.
• Volatility Index(VIX) futures 21.9 +.07%. 
• Euro Stoxx 50 futures +.15%.
• S&P 500 futures +.15%.
• NASDAQ 100 futures -.04%

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• None of note
  

After the Close:

• (RIDE)/-.29
• (NDSN)/1.64
  

Economic Releases

8:30 am EST

• The Chicago Fed National Activity Index for April.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Brainard speaking on digital currencies, House Hearing on SPACs/public listings, Eurozone GDP report, German IFO report and the JPMorgan Tech/Media/Communications Conference could also impact trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

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

Evening Headlines

Bloomberg:        

• Trudeau Ministers Begin Sketching Plan to Reopen U.S. Border.
• Bill Gates’s Carefully Curated Geek Image Unravels in Two Weeks.
• Epstein Guards to Skirt Jail Time in Deal With Prosecutors.  
• Chinese Billionaire Exits AMC, Reversing Global Expansion.
  
• Oregon Offers $1 Million; U.S. Enlists Dating Apps: Virus Update.
  
• California to Drop Social Distancing Requirements in June.
• Oil Has Worst Week in Over a Month With Potential Iran Return.
• Gold Heads for Third Weekly Advance With Inflation in Focus.  
• Meat Eaters Hit Hardest as Inflation Sweeps U.S. Grocery Aisles.  
• Gap With White House on Infrastructure Is Widening, GOP Says.

Wall Street Journal:

• Israel-Hamas Cease-Fire Holds Despite Jerusalem Clashes.
• Can the U.S. Lead a Human-Rights Alliance Against China?
• Racism at Chicago’s City Hall.
• Gretchen Whitmer’s Pipeline War.
• Will Fauci’s Boss Answer the Questions about the Wuhan Lab?
• Drought Imperils Economy in California’s Farm Country.
• Bitcoin Miners Are Giving New Life to Fossil-Fuel Power Plants.
• ‘Black Fungus’ Infects Thousands of India’s Covid-19 Survivors.
• Food Supply Chains Stretched as Americans Return to Restaurants.

CNBC:

• Bitcoin price falls after China calls for crackdown on bitcoin mining and trading behavior.
• Biden slashes GOP priorities in $1.7 trillion infrastructure counteroffer to Senate Republicans.
• Cramer’s week ahead: Big week of earnings with Snowflake, Toll Brothers reporting.
• Stocks could be volatile in week ahead amid turbulence from cryptocurrency.
• Media mogul Barry Diller says cryptocurrencies are a ‘con’.

IG:

• Weekend Markets Trading Live.

Fox News:

• Biden sends message to 'Squad,' saying, 'My party still supports Israel'.
  

Newsmax: 

• Rasmussen: Almost Half of Conservatives Say Fox News Not 'Favorite'.
  

Zero Hedge:

• Police Recruiting Plummets Ahead Of Violent Summer.
• Stocks Are Following The 1968 Analog.
• How Bill Gates' Carefully Curated "Tech Savior" Image Unraveled.
• Watch: Rep. Jordan Exposes Democrats' Efforts To Stifle COVID Origin Investigation.
• Tulsi Gabbard Slams "Abhorrent" Chicago Mayor's "Blatant Anti-White Racism" - Demands Resignation.
• White House Proposes Reduced $1.7 Trillion Infrastructure Plan; Republicans Still Balk.
• GOP Midterm Enthusiasm Outpaces Democrats By Double Digits As Trump Support Remains Strong: Poll.
• Texas Judge Finds Biden Admin Engaged In Racial, Gender Discrimination In Pandemic Relief Program.
• Arizona's Top Elections Official Claims Machines Being Audited May Have Been "Compromised"... By Auditors.
• Corporate Media's Double Standard: They Attack Whomever They Want, But You Cannot Criticize Them.
• Cryptos Crushed, Commodities Crumbled, But 'Crappy' Stocks Soared This Week.
  

TheGatewayPundit.com:

• Breaking: Georgia Judge Calls for Forensic Audit of Fulton County Ballots After Large Discrepancies Found in Ballot Batches.
• Breaking: Maricopa County’s Attorney Office Writes Senate Leader Karen Fann – Requests ALL DOCUMENTS Regarding Deleted Election Database Directory.
• Gabe Sterling Tried to Tell Us Stuffing Ballots 2 and 3 times in Voting Machines in Atlanta on Election Night was Fine – A Georgia Judge Today Disagreed.

The Epoch Times:

• China’s Iron Ore Diversification Could Hit Australian Economy.

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).