Friday Watch

Night Trading 

• Asian equity indices are -.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 92.25 -1.75 basis points.

• China Sovereign CDS 54.0 -1.25 basis points.
  

• Bloomberg Emerging Markets Currency Index 58.71 -.02%. 
• Bloomberg Global Risk-On/Risk Off Index 3,174.0 -74.0 points.
• Volatility Index(VIX) futures 20.1 +.5%.
• FTSE 100 futures +.08%.

• S&P 500 futures +.10%

• NASDAQ 100 futures +.12%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (BMI)/.50
• (SCHW)/.81
• (GS)/9.94
• (JBHT)/1.78
• (PNC)/3.64
• (PLD)/1.03
• (SXT)/.81
• (TFC)/1.20
  

After the Close:

• None of note
  

Economic Releases

8:30 am EST

• Empire Manufacturing for Oct. is estimated to fall to 25.0 versus 34.3 in Sept.
• Retail Sales Advance MoM for Sept. is estimated to fall -.2% versus a +.7% gain in Aug.
• Retail Sales Ex Autos MoM for Sept. is estimated to rise +.5% versus a +1.8% gain in Aug.
• Retail Sales Ex Autos and Gas for Sept. is estimated to rise +.4% versus a +2.0% gain in Aug.
• The Import Price Index MoM for Sept. is estimated to rise +.6% versus a -.3% decline in Aug.
• The Import Price Index  ex Petrol for Sept. is estimated to rise +.2% versus a -.1% decline in Aug.
• The Export Price Index MoM for Sept. is estimated to rise +.7% versus a +.4% gain in Aug.
  

10:00 am EST

• Business Inventories for Aug. is estimated to rise +.6% versus a +.5% gain in July.
• Univ. of Mich. Consumer Sentiment for Oct. is estimated to rise to 73.0 versus 72.8 in Sept.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The China retail sales report and the (RIO) 3Q operations review 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 industrial 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 Surging into Final Hour on Lower Long-Term Rates, Earnings Optimism, Technical Buying, Tech/Healthcare Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 17.0 -8.5%
• Bloomberg Global Risk On/Risk Off Index 3,275.0 +56.0 points

• Euro/Yen Carry Return Index 135.89 +.32%

• Emerging Markets Currency Volatility(VXY) 8.84 -.79%

• S&P 500 Implied Correlation 54.1 -5.8%

• ISE Sentiment Index 107.0  +1.0 point
  

• Total Put/Call .78 -12.4%

• NYSE Arms .99 -18.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 52.6 -2.9%
  

• US Energy High-Yield OAS 365.41 -1.9%

• European Financial Sector CDS Index 57.85 -3.5%

• Italian/German 10Y Yld Spread 102.0 -1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 93.0 -.6%
  

• Emerging Market CDS Index 182.06 -2.0%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 34.52 +1.3%

• 2-Year Swap Spread 13.75 +.75 basis point
  

• TED Spread 8.75 unch.
  

• 3-Month EUR/USD Cross-Currency Basis Swap -20.5 -1.75 basis points
  
• MBS  5/10 Treasury Spread  69.0 -3.5 basis points
  
• IHS Markit CMBX BBB- 6 71.5 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 58.71 -.07%
• 3-Month T-Bill Yield .04% unch.
  

• Yield Curve 120.0 -3.0 basis points
  

• China Iron Ore Spot 120.7 USD/Metric Tonne +.2%

• Citi US Economic Surprise Index -19.3 +1.0 point

• Citi Eurozone Economic Surprise Index -73.8 +.2 point
  

• Citi Emerging Markets Economic Surprise Index -3.1 -1.1 points

• 10-Year TIPS Spread 2.5 +1.0 basis point
• 99.5% chance of no change at Dec. 15th meeting, 97.0% chance of no change at Jan. 26th meeting

US Covid-19:

• 188 new infections/100K people(last 7 days total) -3/100K people
• 35% of Jan. 7th, 2021 peak(highest daily avg. new infections) -1.0 percentage point
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +190 open in Japan 
• China A50 Futures: Indicating +2 open in China

• DAX Futures: Indicating +3 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 75% Net Long
  

Bear Radar

 Style Underperformer:

• Samll-Cap Value +1.1%

Sector Underperformers:

• 1) Shipping -.7% 2) Paper -.5% 3) Alt Energy -.4%

Stocks Falling on Unusual Volume: 

• USB, PVAC, CMC, AXSM, LPI, BANC, AMR, NOG, ARCH, DOCS, CAR, BRBR, GOGO, LYFT, PLUG, EGLE, MATX, METC, MTTR, ACAD, GNK, CDXS, BYRN, RDW, PLXP, BTAI and JSPR
  

Stocks With Unusual Put Option Activity:

• 1) NVTA 2) WBA 3) HOG 4) GILD 5) LQD
  

Stocks With Most Negative News Mentions:

• 1) FUTU 2) GEF 3) AIRG 4) EOG 5) CAR
  

Charts:

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

Bull Radar

 Style Outperformer:

• Mid-Cap Growth +1.9%

Sector Outperformers:

• 1) Semis +2.9% 2) Healthcare Providers +2.6% 3) Gold & Silver +2.2%

Stocks Rising on Unusual Volume:

• NRXP, HLBZ, JBI, OCGN, RLAY, AMBA, TASK, WBA, GRWG, SMAR, OSCR, HZAC, ALLO, PRLB, OKTA, EVOP, UNH, RYTM, SGH, HFRO, PRLD and VCEL
  

Stocks With Unusual Call Option Activity:

• 1) NRXP 2) DPZ 3) ICLN 4) COTY 5) SKX

Stocks With Most Positive News Mentions:

• 1) VIOT 2) GTLB 3) QEPC 4) GMBL 5) UNH
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -11.0% Below 100-Day Average 
• 11 Sectors Rising, 0 Sectors Declining
• 75.9% of Issues Advancing, 20.7% Declining
• 121 New 52-Week Highs, 14 New Lows
• 56.9% of Issues Above 200-day Moving Average
• Average 14-Day RSI 46.7%
  
• Bloomberg Global Risk-On/Risk-Off Index 3,284.0 +66.0 points
• Russell 1000: Growth/Value 17,517 +.25%
  
• Vix 17.4 -6.6%
• Total Put/Call .82 -7.9%
• TRIN/Arms 1.23 +1.7%

Thursday Watch

Evening Headlines

Bloomberg:                   

• Australia to Consider Pfizer Shot for Children as Young as Five.
• U.K. Companies Increase Salaries and Still Can’t Find Workers.
• Chile’s Back-to-Back Key Rate Shocks Signal Fast End to Stimulus.
• Asian Stocks Set to Rise; Longer Term Yields Fall: Markets Wrap.
• Biden Confronts Supply-Chain Crisis Stretching Past His Grip.
• Apple Finally Falls Victim to Never-Ending Supply Chain Crisis.
• Retailers Expect to Disappoint Holiday Customers, Study Finds.
• Supply-Chain Logjam to Drive U.S. Diesel Use to Highest in Years.  
• Fed Officials Saw Taper Starting in Mid-November or Mid-December.  
• The U.S. Debt-Limit Increase Is Mostly Earmarked for Use Already.

Wall Street Journal:

• Persistent Inflation Ripples Through U.S. Economy.
• How Baylor Steered Lower-Income Parents to Debt They Couldn’t Afford.
• Employers Caught in the Middle After Texas Bans Mandates.
• The Inflation Tax Rises.  
• Cancel Culture’s Mental-Health Toll.

Fox News:  

• EXCLUSIVE: Biden planning on opening up America to former employees of bloodthirsty Taliban regime.
• Interpreter who helped rescue Biden escapes Afghanistan, says Taliban have 'no mercy'. 
  

CNBC.com:  

• Fed says it could begin ‘gradual tapering process’ by mid-November.
  
• Social Security benefits will jump by 5.9%, the most in 40 years.

MarketWatch.com:          

• Energy crisis? What experts are saying as world faces historic energy-price crunch.
  
• ‘It will help marginally’ — Biden’s attempt to fix supply chain problems shows just how bad the issue is  
• Nike fears movement toward ‘New Balance and smaller, independent brands’: report.  
• As FDA sounds warning on salt intake, these diets help reduce blood pressure and heart disease.

Zero Hedge:

• Here is The Hidden $150 Trillion Agenda Behind The "Crusade" Against Climate Change.
• Michael Burry Drops Redpills In Epic Twitter Rant.
• New Zealand Forces Vaccination Mandate On All Education, Health-Care Workers.
• Kemp: Beset By Coal Shortages, India's Power Grid Struggles To Meet Demand.
• Taiwan Is Part Of China, Russia Declares, As Two Powers Coordinate To Resist US Pressure.
• Supply Chain Disruptions Force White House To Ask Walmart, UPS, FedEx To Increase Output.
• Mainstream Media Finally Accepts That COVID Lab Leak Is Most Likely Theory.
• Facebook's Secret Blacklist Includes Members Of ISIS, The Crips, Hamas & 'The Hillbilly Militia'.
•  'Dumb And Disrespectful': Katie Couric 'Protected' RGB By Editing Anti-Kneeling Comments From 2016 Interview.
•   Marine Officer Who Criticized US Military Officials Over Afghanistan Withdrawal To Plead Guilty As Part Of Plea Deal.
• Goldman Picks Winners And Losers In Battle For $20 Billion COVID Antiviral Market.
• Now A US Govt Official Is Telling Us That Supply Chain Nightmares Could Potentially Last For "Years".
• WTI Shrugs At Mixed Inventory Data: Crude Build, Gasoline Draw.
• Bitcoin & Bullion Bounce As Bonds Signal Fed Faux-Pas Imminent.

NY Post: 

• US companies riddled with members of Chinese Communist Party: Devine. Boeing(BA), Qualcomm(QCOM) and Pfizer(PFE) are just three US companies that have employed dozens of CCP members in their Chinese facilities, the database reveals.

Newsmax:

• Report: Biden and Son Shared Bank Account.   
• Dad of Girl 'Raped' by 'Gender-Fluid' Boy: Was Told, 'Stay Quiet'. 
• Peter Navarro: Bidens in Back Pockets of China.
• Higher Inflation Squeezing Consumers as Food Prices, Rents Accelerate.

TheGatewayPundit.com:

• “Why Can’t the Public See the Ballots?” – President Trump Releases Statement on Georgia Judge’s Decision Dismissing Inspection of Fraudulent Fulton County Ballots.
•   WATCH: Rapper Creates Viral “Let’s Go Brandon” Theme Song, Starts Trend On Tik Tok (Video).
• “Have You Been Vaccinated Yet?! You’re Dangerous” – Terry McAuliffe Loses His Temper When Asked About His Stance on Parents Being Involved in Their Child’s Education (VIDEO).
• Psaki on Inflation: “The American People Are Not Looking at Cost-to-Cost Comparisons From This Year to Two Years Ago” (VIDEO).
•   Joe Biden Ignores Reporters Asking if Christmas Packages will Arrive on Time (VIDEO).
•   BIDEN EFFECT: US Government Expects Households to See Heating Bills Jump as Much as 54% This Winter.
• BREAKING: Georgia Judge Ends Effort to Audit 2020 Election Ballots in Fulton County.
• SICKENING: Loudoun County Schools Covered Up Rape of a 14-Year-Old Girl and Prosecuted Her Father To Protect Male Transgender Student Who Was Permitted to Use Ladies Bathrooms.

The Epoch Times:

• ‘They Choose to Steal Rather Than Innovate’: Experts Sound Alarm on China’s Theft of American IP.
• China’s Coal Prices Hit Record High Amid Growing Power Crisis.

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).
• Bloomberg.com:  International Travel Restrictions.  Case Graphs by State.
  
• NYTimes.com:  County Trends and Clusters. Local ICU Occupancy.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity(region).
  
• 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 +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 94.0 +.5 basis point.

• China Sovereign CDS 55.25 -.25 basis point.
  

• Bloomberg Emerging Markets Currency Index 58.71 -.07%. 
• Bloomberg Global Risk-On/Risk Off Index 3,207.0 -12.0 points.
• Volatility Index(VIX) futures 20.9 -.98%.
• FTSE 100 futures +.51%.

• S&P 500 futures +.32%

• NASDAQ 100 futures +.43%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (BAC)/.70
• (C)/1.79
• (CMC)/1.28
• (DPZ)/3.10
• (MS)/1.68
• (PGR)/.22
• (TSM)/5.78
• (USB)/1.16
• (UNH)/4.42
• (WBA)/1.02
• (WFC)/.94
  

After the Close:

• (AA)/1.80

Economic Releases

8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 320K versus 326K the prior week.
• Continuing Claims are estimated to fall to 2670K versus 2714K prior.
• PPI Final Demand MoM for Sept. is estimated to rise +.6% versus a +.7% gain in Aug.
• PPI Ex Food and Energy MoM for Sept. is estimated to rise +.5% versus a +.6% gain in Aug.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Australia Unemployment report, weekly Langer Consumer Comfort Index, weekly EIA natural gas inventory report, (HRL) investor update, (WBA) investor conference, (SAFM) investor event and the (LOW) fireside chat 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 cyclical shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.