Thursday Watch

Evening Headlines

Bloomberg:                   

• U.S. Envoy Wendy Sherman to Visit China as Tensions Build.
  
• China’s Latest Easing Sparks a Shift Through Its Debt Markets.  
• U.S.-China Goods Trade Booms as If Virus, Tariffs Never Happened.
• Covid May Have Claimed as Many as 5 Million Lives in India.  
• ECB to Move Stimulus Path for New Inflation Goal: Decision Guide.
• Asian Stocks Advance After Earnings-Led U.S. Climb: Markets Wrap.
• Crude Oil Trades Above $70 a Barrel Following Two-Day Rebound.
• Biden Dismisses Inflation Concerns But Not Hiring Difficulties.
• Powell Has Broad Support Among Top Biden Aides for New Fed Term.
• Debt-Limit Steps May Run Out in October, Budget Office Says.  
• Lumber Rises as Canada Wildfires Snarl Production, Shipments.  
• Single-Family Rents Climbed at 6.6% Pace in May, CoreLogic Says.

Wall Street Journal:

• Car Dealers Can Keep Rolling After Supply Crunch.
• Tough Biden Talk, Little Action.
• Watch: How TikTok’s Algorithm Figures Out Your Deepest Desires.
• FTC Wants to Make It Easier to Fix Devices.
• Starter-Home Shortage Extends Beyond Major Cities

Fox News: 

• White House meeting with CDC to discuss making major change to mask guidance as COVID "surges".
• Biden questions whether parents will be honest about their kids being vaccinated.
• Police point to bigger problem as latest shoplifting video emerges, crime soars.
  

CNBC.com:

• Local officials across U.S. are starting to reimpose Covid mask rules as delta variant takes hold.
• The bond market is torn over the potential for higher inflation and lower growth.
• Jim Cramer predicts S&P 500 ‘is done getting slammed,’ sees upside ahead.
  

MarketWatch.com:          

• Think this is a ‘weird market’ right now? Here’s more proof.
  
• Takeout and dining out has never been so popular – how U.S. restaurants survived and now thrive.

Zero Hedge:

• Democrat Who Featured In Infamous 'Maskless Flight' Pic Calls For "Universal Mask-Wearing".
• Rockets Target Kabul Presidential Palace As US Afghan Draw Down Enters Final Days.
• National Park Service To Send Data Collected From Special Use Permits To White House.
• Saudi Aramco Targeted In $50M Crypto Extortion Scheme After Major Data Breach.
• Paying Your "Fair Share" Of The Warfare-Welfare State.
• Watch: Capitol Defendant's Attorney Says Detainees Are Being Subject To "Torture!" In Contentious CNN Interview.
• Whitmer Kidnapping Defendants Claim Entrapment After 12 FBI Informants Involved In Plot.
• American Life Expectancy Sees Biggest Drop Since WWII, Erasing 20 Years Of Progress.
• The Fallacy Of Climate Financial Risk.
• Senate Republicans Vote To Block Opening Debate On $1.2 Trillion Bipartisan Infrastructure Deal.
• Musk Sparks Major Crypto Spike, Stock Short-Squeeze Continues.

Newsmax:

• Texas Lawmaker Seeks Audit of Ballots in 13 Largest Counties.  
• Rep. Babin: Biden, Dems 'Shirking Constitutional Duty' at Border.
• Rep. Donalds: Fauci 'Lost His Credibility'.
  

TheGatewayPundit.com:

• Mike Lindell Offers $5 Million Reward to Any Cyber Expert Who Can Prove His Voter Fraud Data Invalid.
• Biden Homeland Security Announces Travel Restrictions for Americans at Border Due to COVID Variant But Southern Border Will Remain Open to Illegals.
• Sen. Ron Johnson: Data from Israel Shows 84% of New COVID Cases are with Vaccinated Individuals (VIDEO).
• House Democrats Block Bill to Declassify Intel on Origins of COVID-19 Virus in Wuhan Lab.
• VIDEO: US Women’s Soccer Team Took Knee During Anthem Before Getting Spanked by Swedish Team 3-0 in Olympic Opening.
• He’s Culpable. He’s Lying About It. And He Needs to Be Held Accountable” – Sen. Ron Johnson Says It’s Time to Go After Fauci for Funding Gain-of-Function Research, Lying About It Under Oath (VIDEO).

The Epoch Times:   

• Public Health Experts Tell House GOP Forum CCP Virus ‘Likely Originated’ in Wuhan Lab Leak.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
  
• NYTimes.com:  County Trends and Clusters.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity.
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading 

• Asian equity indices are +.25% to +1.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 85.5 -.5 basis point.

• China Sovereign CDS 38.25 +.25 basis point.
  

• Bloomberg Emerging Markets Currency Index 59.92 +.02%.
• Bloomberg Global Risk-On/Risk Off Index 2,854.0 +24.0 points.
• Volatility Index(VIX) futures 20.10 -.04%.
• FTSE 100 futures +.19%.

• S&P 500 futures +.11%.

• NASDAQ 100 futures +.16%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (ABB)/.40
• (ABT)/1.02
• (ALK)/-.45
• (AAL)/-1.72
• (T)/.79
• (BIIB)/4.60
• (BX)/.77
• (CLF)/1.51
• (DHI)/2.81
• (DHR)/2.05
• (DPZ)/2.88
• (DOW)/2.35
• (FITB)/.81
• (FCX)/.75
• (GPC)/1.54
• (NEM)/.77
• (NUE)/4.78
• (POOL)/5.48
• (DGX)/2.85
• (RS)/4.89
• (SGMS)/.08
• (SNA)/3.24
• (LUV)/-.26
• (UNP)/2.54
  

After the Close:

• (OZK)/.92
• (SAM)/6.91
• (COF)/4.51
• (CSL)/2.22
• (FE)/.56
• (INTC)/1.07
• (RHI)/1.04
• (SNAP)/-.01
• (TWTR)/.07
• (VRSN)/1.37
  

Economic Releases

8:30 am EST

• The Chicago Fed National Activity Index for June is estimated to rise to .3 versus .29 in May.
• Initial Jobless Claims for last week are estimated to fall to 350K versus 360K the prior week. 
• Continuing Claims are estimated to fall to 3100K versus 3241K prior.
  

10:00 am EST

• The Leading Index for June is estimated to rise +.9% versus a +1.3% gain in May.
• Existing Home Sales for June is estimated to rise to 5.9M versus 5.8M in May.

11:00 am EST

• Kansas City Fed Manufacturing Activity for July is estimated to fall to 25.0 versus 27.0 in June.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The ECB meeting, Eurozone IFO Guidance, weekly Langer Consumer Comfort Index, weekly EIA natural gas inventory report and the (SCHW) business update could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are higher, boosted by technology and industrial shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.

Stocks Rising into Final Hour on Earnings Optimism, Oil Gain, Short-Covering, Commodity/Financial Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Below Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 18.2 -7.9%
• Bloomberg Global Risk On/Risk Off Index 2,815.0 +244.0 points

• Euro/Yen Carry Return Index 134.41 +.56%

• Emerging Markets Currency Volatility(VXY) 8.8 +.6%

• S&P 500 Implied Correlation 37.2 -5.9%

• ISE Sentiment Index 100.0  -1.0 point
  

• Total Put/Call .81 +5.2%

• NYSE Arms .45 -2.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 49.5 -2.8%
  

• US Energy High-Yield OAS 426.88 -3.4%

• European Financial Sector CDS Index 55.51 -2.6%

• Italian/German 10Y Yld Spread 108.0 -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 86.30 +.1%
  

• Emerging Market CDS Index 161.94 -.4%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 38.85 -.01%

• 2-Year Swap Spread 8.5 +.5 basis point

• TED Spread 9.0 -.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -4.0 +.5 basis point
  
• MBS  5/10 Treasury Spread  73.25 -.75 basis point
  
• IHS Markit CMBX BBB- 6 73.75 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 59.78 +.16%
• 3-Month T-Bill Yield .05% +1.0 basis point
  

• Yield Curve 101.0 +3.0 basis points
  

• China Iron Ore Spot 202.90 USD/Metric Tonne -5.7%

• Citi US Economic Surprise Index 12.1 -2.3 points

• Citi Eurozone Economic Surprise Index 60.3 -3.9 points
  

• Citi Emerging Markets Economic Surprise Index 58.5 -1.8 points

• 10-Year TIPS Spread 2.30 +4.0 basis points
• 100.0% chance of no change at Nov. 3rd meeting, 100.0% chance of no change at Dec. 15th meeting

US Covid-19:

• 79 infections/100K people(last 7 days) +4/100K people
• 15% of Jan. 7th, 2021 peak(highest daily avg. new infections) +1.0 percentage point
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +402 open in Japan 
• China A50 Futures: Indicating -2 open in China

• DAX Futures: Indicating +21 open in Germany

Portfolio:

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

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Bear Radar

 Style Underperformer:

• Large-Cap Growth +.4%

Sector Underperformers:

• 1) Utilities -.5% 2) Medical Equipment -.2% 3) Foods -.2%

Stocks Falling on Unusual Volume: 

• UP, NFLX, HOG, FOUR, HCSG and SNBR
  

Stocks With Unusual Put Option Activity:

• 1) PETS 2) HOG 3) CNC 4) BOX 5) KO
  

Stocks With Most Negative News Mentions:

• 1) SNBR 2) ATHM 3) LDI 4) INTZ 5) DPZ
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +1.9%

Sector Outperformers:

• 1) Oil Service +5.4% 2) Alt Energy +4.5% 3) Gaming +3.5%

Stocks Rising on Unusual Volume:

• SAVA, AHT, AGFY, LE, PLL, AVPT, AMEH, IPG, INMB, CMG, CUK, AFIB, CCL, NCLH, PBF, STEP, GATO, CNK, BLDR, SOFI, LAD, HA, HWC, ISEE, CRX, RADI, HAL, SAVE, PTRA, SWI, RCL, XENT, UAL, EOG, ALBO, MRNA, AAL, AN, RPD, NRIX and LUV
  

Stocks With Unusual Call Option Activity:

• 1) OIH 2) CMG 3) APO 4) KSU 5) ISRG

Stocks With Most Positive News Mentions:

• 1) CEMI 2) LEXX 3) IPG 4) CMG 5) NIO
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -9.2% Below 100-Day Average 
• 7 Sectors Rising, 4 Sectors Declining
• 72.9% of Issues Advancing, 22.9% Declining
• 81 New 52-Week Highs, 11 New Lows
• 75.9% of Issues Above 200-day Moving Average
• Average 14-Day RSI 43.7%
  
• Bloomberg Global Risk-On/Risk-Off Index 2,785.0 +213.0 points
• Russell 1000: Growth/Value 17,504 -.46%
  
• Vix 18.7 -5.4%
• Total Put/Call .85 +10.4%
• TRIN/Arms .46 unch.

Wednesday Watch

Evening Headlines

Bloomberg:                  

• China Cities Warn of New Power Outages as Heat Strains Grids.  
• U.K. Growth Slowed in June for Most Sectors in Lloyds Survey.   
• EU Proposes Ban on Anonymous Cryptocurrency Transactions.
• J&J Jab Against Delta; Japan Warns of Tokyo Cases: Virus Update.
• Asian Stocks Track U.S. Rally as Traders Buy Dip: Markets Wrap.
• Delta From Delta, $22 Trillion Hole, Policy Stability: Eco Day.
• Treasury Rally Pauses for Breath After Yields Take a Hammering.
  
• Inflation Is Here — These 35 Metrics Tell You How Much to Worry.
  
• Bankers Need 72-Hour Work Week to Master Job, Says Erdoes.
• JPMorgan Entices Dimon to Stick Around With Surprise Stock Award.
• Schumer Heads for Infrastructure Vote Defeat as Talks Drag.

Wall Street Journal:

• U.S. Set to Drop Opposition to Nord Stream 2 Pipeline.
• The Olympics Are Turning Into a $20 Billion Bust for Japan. 
• Chinese Suppliers Shun Xinjiang Workers as U.S. Forced-Labor Ban Looms.
• A Deeper Look at Critical Race Theory.

Fox News: 

• Amazon workers fume after billionaire Bezos thanks them for funding his rich hobby.
  

CNBC.com:

• Biden to nominate Google critic and progressive favorite Kanter to lead DOJ Antitrust Division.
• Corporate earnings will dictate the market’s next move, Jim Cramer says.
• Stocks making the biggest moves after hours: Netflix, Chipotle, United Airlines and more.
  

MarketWatch.com:        

• United Airlines to Wall Street: Profit should return next quarter.  
• Bitcoin slips below $30,000 ‘key support’ as stock market rebound leaves cryptos behind.  
• Netflix lays out mobile games plan that could set a collision course with Apple.  
• Chipotle stock heads toward record high after earnings show sales jumped nearly 40%.  
• 10 software stocks with sales expected to increase up to 174% through 2023.

Zero Hedge:

• More Than 50% Of Australians On Lockdown As Delta Fears Spread.
• Lawmakers Sound Alarm Over China Purchases Of US Farmland.
• Street Justice: Man Found Dead On Staten Island With "I Touch Little Girls" Scrawled Across His Chest. 
• Goldman Flow Desk: No Institutions Bought Today's Dip.
• Over 200 People In 27 States Being Monitored For Monkeypox: CDC.
• California Appeals Court Overturns Anti-Misgendering Law On First Amendment Grounds.
• The Gigantic Holes In Anti-Oil ESG Activism.
• Arkansas Emerges As America's Newest COVID Case 'Hot Spot' As Delta Continues To Dominate.
• "Extremely Disconnected" Energy Stocks Face Explosive Short Squeeze: JPM.
• WTI Tumbles After Surprise Crude Build.
• Massive Short-Squeeze Erases Yesterday's Dramatic Stock Losses.
  

TheGatewayPundit.com:

• “Dr. Fauci as You Are Aware It is a Crime to Lie to Congress, Section 1001 of the US Criminal Code” — Senator Paul Threatens Liar Fauci with Felony for Lying to Congress (VIDEO).
• “Patriot” Is Hate Speech: MSNBC Warns Viewers to Be on the Lookout for Online Groups That Use the Word “Patriot”.
• FIREWORKS! Senator Rand Paul Rips Arrogant Fauci: “There Will be Responsibility For Those Who Funded the Wuhan Lab, Including Yourself” (VIDEO).
• REVEALED: FBI Played Larger Role in Whitmer Kidnapping Case Than Previously Reported: FBI Informants Helped Hatch the Plot!

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
  
• NYTimes.com:  County Trends and Clusters.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity.
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks.
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading 

• Asian equity indices are unch. to +1.0% on average.

• Asia Ex-Japan Investment Grade CDS Index 86.0 +.5 basis point.

• China Sovereign CDS 38.0 -.5 basis point.
  

• Bloomberg Emerging Markets Currency Index 59.70 +.02%.
• Bloomberg Global Risk-On/Risk Off Index 2,607.0 +36.0 points.
• Volatility Index(VIX) futures 21.40 -.4%.
• FTSE 100 futures +.57%.

• S&P 500 futures +.20%.

• NASDAQ 100 futures +.08%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (ANTM)/6.34
• (ASML)/2.49
• (BKR)/.16
• (KO)/.56
• (CMA)/1.60
• (HOG)/1.18
• (IPG)/.43
• (JNJ)/2.29
• (KNX)/.88
• (NDAQ)/1.73
• (NVR)/72.43
• (SAP)/1.17
• (STX)/1.88
• (VZ)/1.30
  

After the Close:

• (CCI)/1.63
• (CSX)/.37
• (DFS)/3.74
• (KMI)/.19
• (LSTR)/2.35
• (LVS)/-.17
• (SLG)/1.62
• (THC)/1.07
• (TXN)/1.85 
• (VMI)/2.50
• (WHR)/6.00
  

Economic Releases

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -3,912,820 barrels versus a -7,896,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -1,047,800 barrels versus a +1,038,000 barrel gain the prior week. Distillate inventories are estimated to rise by +1,161,100 barrels versus a +3,657,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.31% versus a -.4% decline prior.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Senate procedural vote on $1.2T infra bill, 20Y T-Bond auction and the weekly MBA Mortgage Applications report could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and consumer shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the day.