Stocks Slightly Higher into Final Hour on Diminished Virus Shutdown Fears, Lower Long-Term Rates, Earnings Optimism, Tech/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 19.4 +6.4%
• Bloomberg Global Risk On/Risk Off Index 2,556.0 -61.0 points

• Euro/Yen Carry Return Index 133.96 -.37%

• Emerging Markets Currency Volatility(VXY) 8.59 -.46%

• S&P 500 Implied Correlation 54.3 +5.8%

• ISE Sentiment Index 105.0  +7.0 points
  

• Total Put/Call .82 unch.

• NYSE Arms 1.1 -42.1%

Credit Investor Angst:

• North American Investment Grade CDS Index 49.65 +.07%
  

• US Energy High-Yield OAS 430.32 +1.4%

• European Financial Sector CDS Index 53.81 -.77%

• Italian/German 10Y Yld Spread 106.0 -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 91.0 +.1%
  

• Emerging Market CDS Index 163.02 -.89%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 37.8 unch.

• 2-Year Swap Spread 7.75 unch.

• TED Spread 7.75 -.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -4.0 +.75 basis point
  
• MBS  5/10 Treasury Spread  72.75 +.25 basis point
  
• IHS Markit CMBX BBB- 6 73.5 -.25 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 60.22 +.32%
• 3-Month T-Bill Yield .04% unch.
  

• Yield Curve 104.0 -1.0 basis point
  

• China Iron Ore Spot 177.70 USD/Metric Tonne -.2%

• Citi US Economic Surprise Index -15.4 -1.6 points

• Citi Eurozone Economic Surprise Index 38.5 -1.9 points
  

• Citi Emerging Markets Economic Surprise Index 41.5 -7.8 points

• 10-Year TIPS Spread 2.37 -3.0 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:

• 170 infections/100K people(last 7 days) +26/100K people
• 32% of Jan. 7th, 2021 peak(highest daily avg. new infections) +5.0 percentage points
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -171 open in Japan 
• China A50 Futures: Indicating -166 open in China

• DAX Futures: Indicating -19 open in Germany

Portfolio:

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

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Bear Radar

 Style Underperformer:

• Small-Cap Value -.1%

Sector Underperformers:

• 1) Steel -1.2% 2) Telecom -.8% 3) Gold & Silver -.7%

Stocks Falling on Unusual Volume: 

• KMPR, EQT, CERT, POSH, FIS, TDS, OWL, GPN, EVGO, TGTX and XPO
  

Stocks With Unusual Put Option Activity:

• 1) ON 2) MGI 3) KHC 4) BG 5) UAA
  

Stocks With Most Negative News Mentions:

• 1) TGTX 2) MRIN 3) AXAS 4) TDS 5) USM
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +.6%

Sector Outperformers:

• 1) Shipping +2.2% 2) Video Gaming +1.7% 3) Semis +1.3%

Stocks Rising on Unusual Volume:

• ANVS, SAVA, BTBT, AFRM, ON, SQ, ARCT, DOCN, CANO, LPG, DXC, CAR, FUV, HARP, KNBE, FTNT, GRSV, AMTI, ZYXI, TSLA, SLAB, UAA, XENT, RL, ALXO, MSTR, ABOS, AMD and PFE
  

Stocks With Unusual Call Option Activity:

• 1) ON 2) PARR 3) FIS 4) NCR 5) ELY

Stocks With Most Positive News Mentions:

• 1) EVK 2) ON 3) AFRM 4) XPEV 5) LPG
  

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -14.7% Below 100-Day Average 
• 9 Sectors Rising, 2 Sector Declining
• 58.7% of Issues Advancing, 37.0% Declining
• 160 New 52-Week Highs, 21 New Lows
• 76.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 48.2%
  
• Bloomberg Global Risk-On/Risk-Off Index 2,596.0 -20.0 points
• Russell 1000: Growth/Value 17,579 +.2%
  
• Vix 18.4 +1.1%
• Total Put/Call .71 -13.4%
• TRIN/Arms .89 -50.0%

Monday Watch

Today's Headlines

Bloomberg:                       

• Xi Jinping’s Capitalist Smackdown Sparks a $1 Trillion Reckoning.
  
• Macau Gaming Revenue Recovery Slows Amid Travel Restrictions.
• China’s Top Steel Body Expects Wider Output Cuts as Demand Slows.  
• U.S. Blames Iran for Ship Attack, Plans ‘Appropriate Response’.
• Inflation Angst Spreads to India Bonds as RBI Downplays Risk.
• U.K. Companies Step Up Hiring and Wages Amid Reopening.
• Pfizer, Moderna Increase EU Vaccine Pricing in Latest Deals: FT.  
  
• Global Copper Supply at Risk As Workers Vote to Strike.   
• French Car Sales Drop 35% in July as Chip Shortage Crimps Supply.
  
• Thailand Expands Quasi-Lockdown to Cover 40% of Population.   
• Asia Stocks Rise as China-Sparked Dip Draws Buyers: Markets Wrap.
• Saudi Banks, Abu Dhabi Stocks Gain Amid Earnings: Inside EM.   
• Oil Opens Week Steady as Traders Weigh Demand, Iranian Tensions.
• Five Things You Need to Know to Start Your Day.
• U.S. Debt Ceiling Suspension Ends, Congress Unclear on Next Step.
• Treasury Traders Eye Supply-Demand Risks With Yields Near Lows.   
• Japan, U.K. Plan Booster Jabs; India at Risk Again: Virus Update.
  
• Brainard Differs With Powell Ahead of Biden Fed Chair Choice.
• World’s Biggest Pension Fund Cuts U.S. Bond Weighting by Record.   
• Fed’s Kashkari Warns Delta Variant Could Slow Jobs Recovery.

Wall Street Journal:

• Investors Bet Price Pressures Will Ease.
• A Cash-Strapped Corner of China Finds a Financial Tonic—Hard Liquor.
• Higher Pay for New Workers Ripples Through the Ranks.
• Tech Startup Financing Hits Records as Giant Funds Dwarf Venture Capitalists.
• Two U.S. Companies Seek Continued Tariffs on Imported Solar Panels.
• FDA Pressured to Grant Full Approval to Covid Shots.
• Heavyweight Companies Enjoy Outsize Rewards as Economy Rebounds.
• Bye-Bye Bikinis? Athletes at the Olympics and Beyond Fight "Sexist" Uniforms.
• The Rental Evictions Fiasco.

Fox News: 

• Controversial Olympian who protested national anthem says she's 'earned' right to wear US colors.
• HANSON: Americans are sick of being called racists — and ratings prove that.
• Pandemic gun demand leaves law enforcement, instructors short on ammo.

CNBC:

• Senator Manchin says the infrastructure bill text is going to be done today.
• One leading S&P 500 sector just posted its best win streak in more than a year.
• Top Wall Street analysts are betting on more gains for these stocks as earnings continue. 
• Square to buy Australian giant Afterpay for $29 billion as buy now, pay later booms.
• Fauci says he expects no new U.S. lockdowns despite surging delta cases.
• July jobs report could be what gives the market its next big jolt in the week ahead.
• Why Apple shareholders shouldn’t be too worried after the earnings selloff.

Zero Hedge: 

• Bill Maher Rips Woke Mentality Now Driving Olympic Games: "Belongs In Stalin’s Russia".
• 10 Republicans Back Bill Calling For Audit Of The CDC.
• Higher Gas Prices Mean Higher Taxes: Illinoisans Now Pay The Nation's 2nd-Highest Gas Taxes.
• San Fran DA Chesa Boudin Stands Up For Shoplifters And Drug Dealers.
• FDA May Grant Full Approval For Pfizer Jab As Early As September.
• Goldman's Top 10 Takeaways From July.
• Illinois Unconcerned As Communication And 'Science' Behind COVID Policy Slip Toward Chaos.
• Senate Concludes Infrastructure Bill Text, Moves Toward Vote.
• Major Unions Push Back Against Biden's Vaccine Mandates.
• Orange County Records Spike In Fentanyl Deaths.
• Bill Blain Warns "Financial Asset Inflation Is Now Creeping Into The Real World".
• US Ports Face Peak-Season "Gridlock Plus" As Anchorages Fill.
• To Advance The Climate Agenda: Never Waste Bad Weather.
• Protesters Rage In Paris Against "Health Passports".
• The Latest Lie From On-High: An "Independent Federal Reserve".
• Twitter Suspends Science Writer After He Posts Results Of Pfizer Clinical Test.
• Is A Liquor Shortage Looming?
• Tax-To-GDP Ratio: Comparing Tax Systems Around The World.
• Brandon Smith: Why Are Globalists And Governments So Desperate For 100% Vaccination Rates?
• CDC's Walensky Shrugs Off Idea That Illegals Are Spreading COVID At The Border, Promises "Guidelines" Someday.
• California Parents Are Pulling Children From Public Schools.
• 3D Printed Soft Robo-Hand Can Play Nintendo Super Mario Bros. And Win.
• California Biggest Public Sector Union Opposes Newsom's Vaccine Order.

NewsMax:

• Diamond and Silk Slam Fox News for Mike Lindell TV Ban.
• Breakneck Pace of Crises Keeps National Guard Away From Home. 
• Dick Morris: Biden's Handling of COVID Led to Drop in Polls.
  

TheGatewayPundit.com:

• Australia will Use Military to Enforce Sydney Covid Lockdown – Troops will Knock on Doors to Make Sure Residents are at Home.
• BREAKING EXCLUSIVE: Uncovered Email Shows Milwaukee Elections Executive Woodall-Vogg Laughing About the Election Steal on Election Night.
• Sen. John Barrasso: Democrats’ No. 1 Goal Is Passing S1 where You Don’t Need to Have a Voter ID Anymore – Making It Easier for Democrats to Cheat (VIDEO).
• Dominion Voting Machines Arrive in Ohio County Costing $6.17 Million Up Front — Machines Include Software to “Evaluate Voter Intent”. 
• Police Beat, Pepper-Spray Anti-Lockdown Protesters in Berlin (VIDEO).
• Joe Biden Looks to Provide Free Lawyers at Border to Assist Hundreds of Thousands of Illegal Invaders as They Cross the Open US Southern Border.
• CDC to Start Using a New COVID Test that Will Better Identify Flu Cases After Seasonal Flu Numbers Disappeared in 2020.

The Epoch Times:

• Republicans on House Science Committee Urge Probe Into CCP Virus Origins.

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 indices are unch. to +1.0% on average.
• Asia Ex-Japan Investment Grade CDS Index 90.0 +1.0 basis point.
• China Sovereign CDS 39.5 +.5 basis point.
• Bloomberg Emerging Markets Currency Index 60.03 -.01%.
• Bloomberg Global Risk-On/Risk Off Index 2,647.0 +30.0 points.
• Volatility Index(VIX) futures 21.7 -1.6%. 
• Euro Stoxx 50 futures +.43%.
• S&P 500 futures +.48%.
• NASDAQ 100 futures +.38%

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (CNA)/1.12
• (GPN)/1.90
• (ON)/.49
• (TKR)/1.44
  

After the Close:

• (ANET)/2.55
• (BCC)/4.43
• (COLM)/-.09
• (EMN).2,33
• (FANG)/2.19
• (MOS)/.99
• (NXPI)/2.32
• (PXD)/2.54
• (SBAC)/2.40
• (SPG)/2.38
• (TTWO)/.90
• (RIG)/-.14
• (TREX)/.53
• (VNO)/.71
• (WMB)/.28
  

Economic Releases

10:00 am EST

• Construction Spending MoM for June is estimated to rise +.5% versus a -.3% decline in May.
• ISM Manufacturing for July is estimated to rise to 60.7 versus 60.6 in June.
• ISM Prices Paid for July is estimated to fall to 88.0 versus 92.1 in June.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Australia interest rate decision, Eurozone PMI report and the (F) fireside chat could also impact trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

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

Today's Headlines

Bloomberg:   

• China’s Key Factory Gauge Slips as Economic Recovery Eases.
• China’s Central Bank Says It Will Keep Pressure on Crypto Market.
• Brisbane Joins Sydney in Lockdown as Virus Spreads in Australia.
• Massive Stimulus Looks Here to Stay as BOE to Echo Fed: Eco Week.
• Cases Rise in China and Germany; Brisbane Lockdown: Virus Update.
• Anti-Ark ETF to Bet Against Cathie Wood’s Flagship Fund.
• From Miners to Big Oil, the Great Commodity Cash Machine Is Back.
  
• Crypto Investors Get Ready for More Taxes — but Clearer Rules.  
• More Job Ads Disclose Wages as U.S. Employers Grow Desperate.
• Cornell and Yale Bring Back Masks for Indoor Spaces as Delta Upends Plans.  
• Hedge Funds Are Plowing Money Into Commodities Once Again.  
• Producers Caught Flat-Footed as U.S. Consumer Demand Runs Hot. 
• Trump Raised $56.8 Million From Online Donors Over Six Months.  
• SolarWinds Hack Reached 27 U.S. Attorneys’ Offices, Justice Says.

Wall Street Journal:

• Artificial Intelligence’s Big Chill.
• Towns Trying to Ban Natural Gas Face Resistance in Push for All-Electric Homes.
• Border Surge, Delta Variant Complicate Immigration Agenda.
• Investors Rethink China Bets After Beijing Crackdown.
• Behind the Rise of U.S. Solar Power, a Mountain of Chinese Coal.
• A Popular Bet on Chinese Growth Is Falling Out of Favor.
• A Distorted View of Wealth Inequality.

CNBC:

• U.S. Senate in a rare Saturday session on a $1 trillion infrastructure bill.
• WarnerMedia, NBCUniversal and Disney wrestle balancing value of cable networks and streaming services.

IG:

• Weekend Markets Trading Live.

Barron's:

• Had bullish commentary on (J), (HUBB), (UNP), (IIIN), (APH), (TEL), (ST), (ATCX) and (GSK).

MarketWatch.com:      

• Weekend reads: Time to assess Big Tech earnings and Robinhood’s IPO.   
• The labor shortage is worse than it looks, and help is not on the way.

Fox News:  

• After Fox appearance, Walensky changes vaccine mandate statement.    
• Raging border crisis takes turn with agents forced to leave posts — and Biden admin 'doesn't care': union.

Newsmax:     

• Rep. Malliotakis: Biden Ships Migrants Across US 'Irresponsibly'.
• Rep. Murphy: US Getting 'Orwellian' With COVID.
• Dem Rep. Nadler - and Pelosi - Seen Violating House Mask Mandate.

Zero Hedge:

• Twitter Suspends Science Writer After He Posts Results Of Pfizer Clinical Test.
• One Lockdown From Disaster.
• Goldman Flow Desk Weekly Recap.
• "Not A Drill": Infrastructure Bill Could Sink American Crypto Industry. 
• Hotels In Popular Mexican Resort Towns Now Require Proof Of Vaccination.
• The Battle Of The Censors.
• Cargo Vessel Expelled From US Waters After Discovery Of Chinese Invasive Insects.
• Mexican President Rejects Jabs For Kids, "Won't Be Held Hostage By [Profiteering] Pharma Companies".
• How Science Becomes Religion. 
• Biden Handlers Quietly Notify President He Has 'Something' On Chin - Which He Promptly Eats.
• Countdown To The Next Lockdown: Biden Says "In All Probability" US Will See More Restrictions.
• "Party On Garth!" - Market Rally Continues As Earnings Beat Estimates.
• No More Heat Wave? Cooler Weather Slated For Northeast Next Week.
• UK Lockdown Advocate Now Says Official COVID Infection Rates Are "Fishy" Because They're Dropping.
• Visualized: The Biggest Ponzi Schemes In Modern History.
• Europe's Expensive Climate Club And Its Detractors.
• Watch: NHS Nurses Demand To COVID Test Newborn Baby, Claim It's Not Mother's Property Once Outside Of Womb.
• Schlichter: Imagine If They Hadn't Lied To Us For The Last 18 Months.
• Autonomous Race Cars To Compete At Indianapolis Motor Speedway.
• Delta Variant Causes One Of China's Worst Outbreaks Since Wuhan.
• The Roots Of The Elite Left's Attack On Freedom.

TheGatewayPundit.com:

• Gen. Flynn Exclusive: 10 Indisputable Facts on the 2020 Election That Argue for Audits.
• Andrew Cuomo Begs Businesses To Return To New York City–After Destroying It With Lockdowns.
• Republican Rep. Chip Roy Goes Off On House Dems For Requiring Masks While Ignoring Border Crisis (VIDEO).
• LOCK HER UP: Dishonest CDC Director Rochelle Walensky Lies – Refuses to Admit Illegals Bringing COVID to America are an Issue (VIDEO).
• Far-Left DC Mayor Muriel Bowser Spotted Maskless at Birthday Party Hours Before Her New Mask Mandate Went Into Effect.
• Massive Crowds Protest Vaccine Passports And Mandatory Vaccinations All Over France.
• What’s Really Going on with the Product Shortages We Never Saw Under the Trump Administration?

The Epoch Times:

• More Countries Abandon Chinese COVID Shots, Signaling a Setback to Regime’s ‘Vaccine Diplomacy’.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New US 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).