Morning Market Internals

NYSE Composite Index:

• Volume Running +26.7% Above 100-Day Average 
• 9 Sectors Rising, 2 Sectors Declining
• 65.3% of Issues Advancing, 30.9% Declining
• 5 New 52-Week Highs, 113 New Lows
• 42.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 37.9%
• Bloomberg Global Risk-On/Risk-Off Index 1,855.0 +120.0 points
• Russell 1000: Growth/Value 18,496 -1.3%
  
• Vix 29.7 -4.5%
• Total Put/Call .98 unch.
• TRIN/Arms .78 -55.9%

Thursday Watch

Evening Headlines

Bloomberg:        

• U.S. and EU Set to Discuss Joint Approach to Assertive China.  
• Quant Hedge Funds Brace for End of Unbridled Growth in China.
• Korea’s Decade-High Inflation Boosts Case for Further BOK Hikes.
  
• Macau Confirms Closure of Suncity High-Roller Rooms in Casinos.
  
• Erdogan Replaces Finance Minister as Rate Cuts Deepen Rifts.
• Asia Stocks Dip as Traders Mull Virus, Fed Outlook: Markets Wrap.   
• OPEC+ Faces Output Decision as Omicron Puts Market in Disarray.
• Hedge Funds Bail From Stocks as Powell, Covid Roil Markets.
• Justices Wrestle With Precedent in Fiery Hearing on Abortion’s Future.
  
• Record Volumes at L.A. Ports to Become ‘New Normal’ After Crisis.  
• Bloomberg 50: The People and Ideas That Defined Global Business in 2021.  
• Tesla Makes It Official, Marking Headquarters Move to Texas.  
• Mester Open to Faster Fed Taper to Win Rate-Hike Space If Need.  
• Nikola Founder Has Now Sold $317 Million of Stock Since Charges. 
• Powell Says Fed Policy Will Adapt Amid Risk of Persistent Inflation.

Wall Street Journal:

• Nuclear-Fusion Startup Lands $1.8 Billion as Investors Chase Star Power.
• Omicron Reinfects Government. Covid strategy needs a midcourse correction. It got Joe Biden’s vaccine mandate.
• Key Supply-Chain Link Faces Perfect Storm This Holiday Season.
• California Prepares for More Water Restrictions as Drought Worsens.

Fox News:  

• Liberal Supreme Court justice turning heads over her fetus comparison as tensions rise over abortion case.
• Sen. Tom Cotton blasts DOJ's silence on Waukesha tragedy.
  

CNBC.com:

• Apple backs exemptions for Trump tariffs on Apple Watches and Mac Pro parts.
• Qualcomm jumps into hot gaming market with new chip for portable game consoles.
• Snowflake stock soars on strong revenue and Q4 guidance.
• Salesforce stock has worst day since beginning of pandemic after disappointing earnings forecast.
• Apple loses key autos engineer to electric aviation startup Archer.
• GM raises 2021 earnings guidance on pricing and better chip supply.
• Fourth victim dies in Michigan school shooting as suspect is charged with murder, identified.

MarketWatch              

• WeWork stock falls 5% as company plans to restate financials, admits material weakness.

Zero Hedge:

• White House Responds To First US Omicron Strain With 'Vax Up Or Get Boosted' Blitz.
• France Deploys Military Police To Caribbean Islands Amid Unrest Over Vaccine Mandate.
• JPM's Kolanovic Suggests Omicron Could Be Positive For Risk And "End The Covid Pandemic".
• Dying COVID-19 Patient Recovers After Court Orders Hospital To Administer Ivermectin.
• WHO Recommends People Aged 60 & Above Postpone Travel Due To Omicron Variant Concerns.
• Cook County Blows Past 1,000 Homicides This Year In First Since 1994.
• Police Bodycam Footage Of MSNBC 'Producer' Who Tailed Rittenhouse Jury Way Worse Than Reported.
• Millions Of Americans Are Scrambling To Become Independent Of The System As It Collapses All Around Them.
• The Long Cycles Have All Turned: Look Out Below.
• Trump Social Media Venture Soars: In Talks Over $1 Billion Raise At Much Higher Valuation.
• Having Abandoned TWTR, Jack Dorsey Goes All-In On Crypto, Renames 'Square'.
• NYC Prisons Face Crippling Staff Shortages As Thousands Defy Mayor's Vaccination Mandate.
• Satyajit Das Exposes Fintech's "Flim-Flam" Innovation Games.
• Omicrout.

Reuters:

• Moderna exec says company could have Omicron booster ready in March.Moderna President Stephen Hoge said he believes booster shots carrying genes specifically targeting mutations in the newly-discovered Omicron variant would be the quickest way to address any anticipated reductions in vaccine efficacy it may cause. The company is also working on a multi-valent vaccine that would include up to four different coronavirus variants including Omicron. That could take several more months, he said.

Newsmax: 

• Ronna McDaniel: Abrams Part of 'Progressive Liberal Machine'.
• Sen. Braun: Supply Chain Is 'Not Loosening Up'.

TheGatewayPundit.com:  

• NEW: Biden to Extend Travel Mask Mandate Through Mid-March.
• Stacey Abrams Running For Georgia Governor Next Year (VIDEO).
• BREAKING: 15-Year-Old Michigan High School Shooter Identified – Prosecutors Announce That Teen Will be Tried as Adult and is Charged With Terrorism and Murder (VIDEO).
• Newsom Vacations in Cabo San Lucas at a $29,000 Per Night Villa After Extending Covid State of Emergency in California (PHOTOS).
• CLOWN WORLD: Fauci Calls for Testing of All People Coming into the Country — Except Illegal Border Crossers.
• It Begins. Austria and Greece to Fine Citizens Who Refuse to Get Vaccinated.
• Pelosi Spotted Maskless at Crowded DC Party (VIDEO).

The Epoch Times:

• Women’s Tennis Association Pulls Out of China Over Censorship of Peng Shuai.
• The China Link Between Hunter Biden and Corruption in Uganda.

OpenVAERS:

• VAERS COVID Vaccine Adverse Event Reports. 654,412 (US) Reports Through November 12, 2021.
  

SKirsch.com:

• Using the MGH numbers with our own VAERS queries, we have 247 cases per million doses from the MGH study divided by 5.97 cases per million doses from VAERS. 247/5.97 = 41. This suggests that the VAERS under-reporting factor (URF) is 41X.

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 -.75% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 95.25 unch. 

• China Sovereign CDS 55.25 unch.
  

• Bloomberg Emerging Markets Currency Index 53.62 -.34%. 
• Bloomberg Global Risk-On/Risk Off Index 1,753.0 +19.0 points.
• Volatility Index(VIX) futures 27.0 -3.6%.
• Euro Stoxx 50 futures -1.81%.

• S&P 500 futures +.30%

• NASDAQ 100 futures +.33%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (CCL)/-1.44
• (CLDR)/.11
• (DG)/2.02
• (KR)/.67
• (SIG)/.72
• (TD)/1.95
  

After the Close:

• (COO)/3.38
• (DOCU)/.46
• (MRVL)/.38
• (OLLI)/.47
• (ULTA)/2.47
• (ZUMZ)/1.09
  

Economic Releases 

7:30 am EST

• Challenger Job Cuts YoY for Nov.

8:30 am EST

• Initial Jobless Claims for last week are estimated to rise to 240K versus 199K the prior week.
• Continuing Claims are estimated to fall to 2002K versus 2049K prior.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Quarles speaking, Australia Trade Balance report, weekly Langer Consumer Comfort Index, Goldman Sachs Automotive Conference, weekly weekly EIA natural gas inventory report and the (NVS) capital markets day could also impact global trading today.

US Equity Market Hours

• 9:30 am - 1:00 pm EST
  

BOTTOM LINE: Asian indices are mostly lower, weighed down by technology and commodity shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing modestly lower. The Portfolio is 50% net long heading into the day.

Stocks Slightly Higher into Final Hour on Stable Long-Term Rates, Seasonality, Bargain-Hunting, Homebuilding/Tech Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Mixed
  

• Volume: Heavy 

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 26.3 -3.2%
• Bloomberg Global Risk On/Risk Off Index 2,073.0 +90.0 points

• Euro/Yen Carry Return Index 131.57 -.51%

• Emerging Markets Currency Volatility(VXY) 11.2 +4.8%

• CBOE S&P 500 Implied Correlation 36.2 -2.9% 

• ISE Sentiment Index 116.0  +12.0 points
  

• Total Put/Call .91 -2.2%

• NYSE Arms 1.3 -30.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 57.55 +.31%
  

• US Energy High-Yield OAS 428.53 -3.3%

• European Financial Sector CDS Index 65.39 -3.1%

• Italian/German 10Y Yld Spread 135.0 +4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 95.58 +2.5%
  

• Emerging Market CDS Index 211.09 -1.5%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 32.95 +.15%

• 2-Year Swap Spread 23.75 -1.25 basis points
  

• TED Spread 12.0 -1.0 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -30.75 -1.5 basis points
  
• MBS  5/10 Treasury Spread  70.5 +.75 basis point
  
• IHS Markit CMBX BBB- 6 72.75 -.25 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 53.84 +.31%
• 3-Month T-Bill Yield .05% unch.
  

• Yield Curve 88.5 -11.5 basis points
  

• China Iron Ore Spot 102.4 USD/Metric Tonne +.3%

• Citi US Economic Surprise Index 18.6 -3.9 points

• Citi Eurozone Economic Surprise Index 8.7 +4.7 points
  

• Citi Emerging Markets Economic Surprise Index -5.8 +3.5 points

• 10-Year TIPS Spread 2.45 -6.0 basis points
• 95.2%(-2.3 percentage points) chance of no change at Jan. 26th meeting, 73.8%(-1.3 percentage points) chance of no change at March 16th meeting

US Covid-19:

• 169 new infections/100K people(last 7 days total) -2/100K people
• 32% of Jan. 7th, 2021 peak(highest daily avg. new infections) unch.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -190 open in Japan 
• China A50 Futures: Indicating -60 open in China

• DAX Futures: Indicating -154 open in Germany

Portfolio:

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

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
  

• Market Exposure:  Moved to 25% Net Long
  

Bear Radar

Style Underperformer:

• Mid-Cap Growth -1.0%

Sector Underperformers:

• 1) Gaming -3.1% 2) Airlines -3.1% 3) Alt Energy -2.5%

Stocks Falling on Unusual Volume: 

• CUK, RUBY, PLAN, INSW, TDG, ZNTL, RCL, TWOU, CCL, PACB, SQ, PDCO, NEWR, UAL, ENOB, TDOC, DAL, CRWD, NCLH, SRG, CTRN, HOOD, DDOG, OKTA, AAL, GBIO, U, SEMR, ZS, RBLX, MRNA, ESTC, TWLO, FLGT, NET, GRTS, DOCN, DNUT, CRM, AGC, FSLY, ASAN, TOST, EGHT, SPT, BTAI, TDUP, ALGS, KRYS, NKTX and BIRD
  

Stocks With Unusual Put Option Activity:

• 1) CRM 2) AMBA 3) IYR 4) KRE 5) BKLN
  

Stocks With Most Negative News Mentions:

• 1) BIRD 2) ZM 3) DNUT 4) TLRY 5) SNDL
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value +.6%

Sector Outperformers:

• 1) Homebuilding +2.0% 2) Disk Drives +1.7% 3) Semis +1.6%

Stocks Rising on Unusual Volume:

• AMBA, GCP, BOX, ZGNX, TGTX, RETA, VRTX, HPQ, AOSL, MSP, ACLS and VIR
  

Stocks With Unusual Call Option Activity:

• 1) ARDX 2) AMBA 3) BYSI 4) VBIV 5) IMGN

Stocks With Most Positive News Mentions:

• 1) AMBA 2) BOX 3) GCP 4) ARDX 5) BBW
  

Charts:

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

Afternoon Market Internals

NYSE Composite Index:

• Volume Running +18.5% Above 100-Day Average 
• 11 Sectors Rising, 0 Sectors Declining
• 70.3% of Issues Advancing, 25.6% Declining
• 28 New 52-Week Highs, 64 New Lows
• 49.0% of Issues Above 200-day Moving Average
• Average 14-Day RSI 41.8%
• Bloomberg Global Risk-On/Risk-Off Index 2,265.0 +285.0 points
• Russell 1000: Growth/Value 18,784 -.61%
  
• Vix 24.0 -11.7%
• Total Put/Call .84 -9.7%
• TRIN/Arms 1.19 -38.0%