Stocks Slightly Lower into Final Hour on Valuation Concerns, Oil Decline, Technical Selling, Energy/Road&Rail Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 16.8 +2.3%
• Bloomberg Global Risk On/Risk Off Index 3,508.0 -12.0 points

• Euro/Yen Carry Return Index 137.65 -.07%

• Emerging Markets Currency Volatility(VXY) 8.8 -2.0%

• S&P 500 Implied Correlation 51.2 +4.2%

• ISE Sentiment Index 122.0  +10.0 points
  

• Total Put/Call .65 -22.6%

• NYSE Arms .95 -34.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 50.12 -.23%
  

• US Energy High-Yield OAS 415.30 -1.0%

• European Financial Sector CDS Index 57.44 -.5%

• Italian/German 10Y Yld Spread 111.0 +2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 83.59 -1.6%
  

• Emerging Market CDS Index 157.16 +.03%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 39.31 +.46%

• 2-Year Swap Spread 7.25 -.5 basis point

• TED Spread 11.5 unch.
  

• 3-Month EUR/USD Cross-Currency Basis Swap -2.75 -.75 basis point
  
• MBS  5/10 Treasury Spread  67.0 +1.0 basis point
  
• IHS Markit CMBX BBB- 6 74.25 +.5 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.68 +.04%
• 3-Month T-Bill Yield .02% unch.
  

• Yield Curve 142.0 -4.0 basis points
  

• China Iron Ore Spot 192.7 USD/Metric Tonne -3.1%

• Citi US Economic Surprise Index 13.0 +3.5 points

• Citi Eurozone Economic Surprise Index 139.3 -9.7 points
  

• Citi Emerging Markets Economic Surprise Index 60.10 +.5 point

• 10-Year TIPS Spread 2.41 -1.0 basis point
• 95.0% chance of no change at Sept. 22nd meeting, 95.0% chance of no change at Nov. 3rd meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +131 open in Japan 
• China A50 Futures: Indicating -67 open in China

• DAX Futures: Indicating +23 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 100% Net Long
  

Bear Radar

 Style Underperformer:

• Large-Cap Value -.4%

Sector Underperformers:

• 1) Oil Service -2.5% 2) Steel -1.5% 3) Road & Rail +1.2%

Stocks Falling on Unusual Volume: 

• DASH, PSAC, AFG, HARP, AI, AMSC, ARCB and MGNX
  

Stocks With Unusual Put Option Activity:

• 1) IGT 2) TIP 3) BIIB 4) SFIX 5) EWW
  

Stocks With Most Negative News Mentions:

• 1) CAN 2) BAP 3) NEWT 4) ARCB 5) HARP
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +1.7%

Sector Outperformers:

• 1) Biotech +4.6% 2) Alt Energy +1.6% 3) Gaming +1.4%

Stocks Rising on Unusual Volume:

• USCR, CLOV, AMC, QTS, ATHA, QTRX, ANVS, FUV, OMI, AVXL, SVC, CLNE, LLY, DLTH, AVIR, MIC, RVP, BBBY, OWL, ORMP, SAVA, OPCH, DNLI, GIII, LIND, WKHS, MRNA, HYRE, EAT, CLPT, CRC, RARE, COR, PSTH, CONE, CUBI, BYND, PDAC, ETWO, HOOK, TRGP, STKS, BLUE and NUVB
  

Stocks With Unusual Call Option Activity:

• 1) ADMP 2) DOCU 3) IEF 4) LLY 5) IBB

Stocks With Most Positive News Mentions:

• 1) SKLZ 2) RMO 3) CCXI 4) PCT 5) AZO
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -7.9% Below 100-Day Average 
• 4 Sectors Rising, 8 Sectors Declining
• 52.9% of Issues Advancing, 43.2% Declining
• 299 New 52-Week Highs, 6 New Lows
• 89.1% of Issues Above 200-day Moving Average
• Average 14-Day RSI 53.9%
  
• Bloomberg Global Risk-On/Risk-Off Index 3,483.0 -36.0 points
• Vix 16.8 +2.1%
• Total Put/Call .66 -21.4%
• TRIN/Arms 1.08 -26.0%

Monday Watch

Night Trading

• Asian indices are unch. to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 85.0 -2.75 basis points.
• China Sovereign CDS 36.5 -1.0 basis point.
• Bloomberg Emerging Markets Currency Index 61.65 -.01%.
• Bloomberg Global Risk-On/Risk Off Index 3,514.0 -6.0 points.
• Volatility Index(VIX) futures 20.5 +.79%. 
• Euro Stoxx 50 futures n/a.
• S&P 500 futures -.10%.
• NASDAQ 100 futures -.12%

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (GIII)/.15
  

After the Close:

• (COUP)/-.19
• (HQY)/.32
• (LMNX)/.20
• (MRVL)/.27
• (SFIX)/-.26
• (MTN)/6.56
  

Economic Releases

3:00 pm EST

• Consumer Credit for April is estimated at $22.0B versus $25.841B in March.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The German Factory Orders report, Deutsche Bank Consumer Conference, (AAPL) WWDC, Evercore ISI Tech/Media/Telecom Conference, (REGN) oncology portfolio update, (MRK) oncology event and the Goldman Sachs Travel/Leisure 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 technology and industrial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed.  The Portfolio is 75% net long heading into the week.

Today's Headlines

Bloomberg:        

• Yellen Sees Recent Inflation as Transitory Rather Than Permanent.  
• U.S.-China Trade Relationship Significantly Imbalanced, Tai Says.  
• G-7 Strikes Historic Deal to Revamp Taxation for Digital Era. 
• G-7 Targets Environmental Crimes in Push for Greater Disclosure.  
• Putin Warns U.S. May Regret Using Dollar as Sanctions Weapon.
• Russell Reshuffle May Spell Trouble for Highflying Meme Stocks.  
• Blackstone, H+F, Carlyle Said to Near $30 Billion Medline Deal.
• Central Banks Face New Balancing Act With Their Huge Asset Piles.
• Social Media Buzz: Crypto Weibo Accounts, Royal Caribbean, AR-15.

Wall Street Journal:

• AT&T, Verizon Push Free iPhones for Customers.
• A Good Worker Is Hard to Find.
• Fauci Email Bolsters the Lab-Leak Theory.
• Graduation Rate Expected to Stall This Year at Some High Schools.
  

CNBC:

• G-7 nations reach historic deal on global tax reform.
• Restaurants turn to on-demand hiring apps during the labor squeeze.

IG:

• Weekend Markets Trading Live.

MarketWatch.com:          

• Google is worth more than Amazon for the first time in more than a year.
  

Newsmax:

• Dershowitz to Newsmax: Trump's Enemies Weaponizing Law Against Him.
  

Zero Hedge:

• German Ambassador Seconds Putin's Fiery NS2 Remarks: "European Energy Policy Not Determined By Foreigners".
• Market Hits All-Time Highs As Money Flows Peak.
• Cryptos Tumble After Musk Tweets "Cumrocket To The Moon".
• Abuela Denied: 'Someone' In AOC's Family Kills GoFundMe After It Crosses $100,000 In Donations.
• Unrest Erupts In Minneapolis Amid Protests Over Police-Involved Shooting.
• Federal Judge Overturns California's Ban On Assult Weapons.
• German Study Finds Lockdown "Had No Effect" In Stopping Spread Of COVID..
• Lumber Prices Slump As Historic Boom Hits A Wall.
• McDonald's Tests AI-Powered Automated Drive-Thrus At 10 Chicago Restaurants.

TheGatewayPundit.com:

• EXCLUSIVE: Vernon Jones Says Brian Kemp’s “Stacy’s Law” Agreement Was So Secret Georgia Democrats Were Not Informed on the Deal.
• CNN Suffers “Catastrophic” Viewer Loss In May.
• BREAKING EXCLUSIVE: UN, US, Facebook and Smartmatic Executives Connived Together Before the 2020 Election and Are Now Trying to Stop or Derail 2020 Election Audits Taking Place.
• Exclusive: “This Is A Shot Across The Bow, We Want The Machines Opened Up”, North Carolina House Members Request Inspection of Voting Machines.
• EVERY State Should Be Audited – In California 3,000 Votes Were Recorded from an Empty Dorm Building.

The Epoch Times:

• US Gave More Money to Chinese Lab for Bat Research Than Fauci Claimed: Documents.
• LinkedIn Blocks Some China Critics on Eve of Tiananmen Anniversary, Including Epoch Times Staff.

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).