Tuesday Watch

Evening Headlines

Bloomberg:          

• The Ugly, Expensive Plan to Bring Green Power to China’s Megacities.
• Biden Weighs Russian Banking Sanctions If Putin Invades Ukraine.
• Ukraine Angers Russia by Buying Turkish Drones and Wants To Get Its Hands On More.
• Why Russia-Ukraine Tensions Are So Hard to Defuse.  
• The World's Relentless Demand for Chips Turns Deadly in Malaysia.  
• Sand and Soldiers Mix as Troops Move In to Protect Cancun Tourists.  
• World's Most Indebted Oil Company to Sell up to $1 Billion in Bonds.  
• Asia Stocks Rise After China Action, U.S. Gains: Markets Wrap.
• Oil Edges Higher After Surging on Signs Omicron Angst Overdone.    
• China Property Downturn, IMF on Australia, India Rate Decision: Eco Day.
• Halliburton Sees World Headed for Oil Scarcity Amid Spending Cut.  
• Initial Hospital Data in Omicron Epicenter Shows Milder Disease.  
• Bulls Beware. The $1.7 Trillion Tech Rout May Not Be Over.  
• Traders Find Troubling Clues in VIX to More Stock Turmoil Ahead.  
• Richard Bookstaber on the Big Structural Risk in the Market Right Now.

Wall Street Journal:

• China Increasingly Obscures True State of Its Economy to Outsiders.
• Chinese Internet-Stock Rout Continues.
• Inflation, Falling Unemployment Prompt Fed Pivot.
• Elon Musk on What Lies Ahead in Tech.
• Bill de Blasio’s Parting Insult. He mandates vaccines for all workers in one last swipe at New York.
• China Evergrande’s Managed Restructuring Is Under Way; Shares Hit 11-Year Low.
• Kentucky Derby Winner Medina Spirit Dies After Workout.
• Intel to List Shares in Mobileye Unit.
• SEC Opens Probe Into Tesla Involving Solar-Cell Activity.
• In Ghislaine Maxwell Trial, Second Woman Testifies About Alleged Sexual Abuse.

Fox News: 

• Another CNN anchor accused of inserting himself into investigation days after network fired only star.
• Devin Nunes set to retire to pursue new opportunity he couldn't 'refuse'.

NY Post:

• Ghislaine Maxwell Trial: Live Updates from Day 5.
  

CNBC.com:

• ‘The chart says it all’: Piper Sandler warns investors against Chinese stocks.
• MongoDB shares jump as revenue growth accelerates.

Zero Hedge:

• "Absolute And Unmitigated Liars": Former DC National Guard Official Says Generals Fabricated January 6th Account. 
• Aramco Chief Warns Of "Social Unrest" If Fossil Fuels Are Abandoned Too Quickly.
• Visualizing The Uneven Fallout Of The Inflation Surge.
• Security Heightened At Major Store Chains After Series Of 'Flash Mob' Robberies.
• Survey Finds More Than Half Of Bitcoin Investors Got In During 2021.
• Chris Cuomo Claims CNN’s Jeff Zucker Knew About His Involvement With Andrew Cuomo Scandal.
• Oregon Moves To Make Indoor Mask Mandate Permanent.
• Devin Nunes Leaving Congress To Become Trump Media SPAC CEO.
• Mish: Fauci And Biden Are Medical Hypocrites & A Political Disgrace.
• Too many put lovers around.
• So Much For Fixing Supply Chains: A Record 96 Containerships Are Waiting To Dock At SoCal Ports.
• The Bottom Is Far Lower Than Anyone Believes Possible.
• Stocks Erase Payrolls Puke, Bonds Battered, & Crypto Bounces Back.

TheGatewayPundit.com:  

• WHOA! Jen Psaki Gets IRATE When Asked about Hunter Biden Laptop and Biden Family Corruption – Backroom Deals with Chinese (VIDEO).
• DEVELOPING: McConnell in Private Talks with Schumer to Waive Filibuster to Raise Debt Ceiling – McCarthy, Several Republican Senators Push Back.
• Massachusetts Hospital Fires 200 Employees For Not Getting Covid Vaccine.
• JUST IN: GOP Rep. Devin Nunes Resigns From Congress to Become CEO of Trump’s Media Company.
• Italy Restricts Public Life For Unvaxxed with New Covid “Super Green Pass”.
• FOIA: Newly Released ICE Data Reveals Deportations Have Dropped By 90% Overall Under Borderless Biden Regime.
• New Study: ZERO Deaths From COVID Among Healthy Children — Why Are They Forced To Take Dangerous Vaccine?
• 7-Year-Old Child Allegedly Suffers Stroke and Brain Hemorrhage One Week After Receiving Pfizer COVID-19 Shot (VIDEO).
• Mayor de Blasio Announces Forced Vaccines for All Private Companies and Forced Vaccines for All Children Ages 5-11 if They Want to Eat Out.
• Revealed: Feds Are Investigating Trump’s Media Company While They Ignore Hunter Biden’s Laptop and Shady Deals with China, Russia, Ukraine.
• 81 Million Votes: Devastating Poll Shows Just 22% of Americans Want Joe Biden to Run Again.
• More Police Officers Have Been Shot and Killed This Year Than Any Other Year.

The Epoch Times:

• US Announces Diplomatic Boycott of Beijing Winter Olympics Over Rights Abuses.
• China’s Think-Tank Warns of Economic Slowdown Amid Property Sector Predicament.

OpenVAERS:

• VAERS COVID Vaccine Adverse Event Reports. 672,372 (US) Reports Through November 26, 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 +.25% to +1.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 92.0 -1.5 basis points. 

• China Sovereign CDS 51.75 -.75 basis point.
  

• Bloomberg Emerging Markets Currency Index 53.28 -.07%. 
• Bloomberg Global Risk-On/Risk Off Index 2,022.0 +80.0 points.
• Volatility Index(VIX) futures 26.3 -1.7%.
• Euro Stoxx 50 futures +.21%.

• S&P 500 futures +.25%

• NASDAQ 100 futures +.20%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AZO)/21.08
• (CONN)/.60
  

After the Close:

• (AVAV)/.64
• (CASY)/2.93
• (CHPT)/.-13
• (PLAY)/.13
• (SFIX)/-.14
• (TOL)/2./50
  

Economic Releases 

8:30 am EST

• The Trade Balance for Oct. is estimated at -$66.8B versus -$80.9B in Sept.
  

3:00 pm EST

• Consumer Credit for Oct. is estimated to fall to $25.0B versus $29.913B in Sept.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The China export data, 3Y T-Note auction, weekly US retail sales reports, Barclays Tech/Media/Telecom Conference, Truist Industrials/Services Summit, Citi Consumer Conference and the Goldman Financial Services Conference could also impact global trading today.

US Equity Market Hours

• 9:30 am - 1:00 pm EST
  

BOTTOM LINE: Asian indices are higher, boosted by financial 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 day.

Stocks Substantially Higher into Final Hour on Diminished US Virus Lockdown Fears, Short-Covering, Oil Gain, Airline/Gambling Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 27.0 -11.8%
• Bloomberg Global Risk On/Risk Off Index 1,948.0 +309.0 points

• Euro/Yen Carry Return Index 132.06 +.32%

• Emerging Markets Currency Volatility(VXY) 11.49 +.44%

• CBOE S&P 500 Implied Correlation Index 35.0 -6.8% 

• ISE Sentiment Index 112.0  +4.0 points
  

• Total Put/Call .99 -14.7%

• NYSE Arms .76 -23.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 56.3 -3.6%
  

• US Energy High-Yield OAS 438.02 -1.3%

• European Financial Sector CDS Index 66.0 -1.4%

• Italian/German 10Y Yld Spread 127.0 -3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 92.62 -.52%
  

• Emerging Market CDS Index 204.46 -2.7%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 32.90 +.39%

• 2-Year Swap Spread 22.5 -.25 basis point
  

• TED Spread 14.5 +.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -22.0 -3.25 basis points
  
• MBS  5/10 Treasury Spread  73.25 -1.75 basis points
  
• IHS Markit CMBX BBB- 6 72.75 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 53.31 -.24%
• 3-Month T-Bill Yield .04% unch.
  

• Yield Curve 77.5 -3.5 basis points
  

• China Iron Ore Spot 107.20 USD/Metric Tonne +3.1%

• Citi US Economic Surprise Index 32.6 -1.0 points

• Citi Eurozone Economic Surprise Index -4.9 -10.8 points
  

• Citi Emerging Markets Economic Surprise Index -12.8 -.7 point

• 10-Year TIPS Spread 2.47 +3.0 basis points
• 92.6%(-2.5 percentage points) chance of no change at Jan. 26th meeting, 67.8%(-1.8 percentage points) chance of no change at March 16th meeting

US Covid-19:

• 258 new infections/100K people(last 7 days total) +46/100K people
• 48% of Jan. 7th, 2021 peak(highest daily avg. new infections) +8.0 percentage points
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +172 open in Japan 
• China A50 Futures: Indicating -175 open in China

• DAX Futures: Indicating +29 open in Germany

Portfolio:

• Higher: On gains in my transport/technology/medical/consumer discretionary/industrial sector longs
  

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

• Market Exposure:  Moved to 75% Net Long
  

Afternoon Market Internals

NYSE Composite Index:

• Volume Running +20.4% Above 100-Day Average 
• 11 Sectors Rising, 0 Sectors Declining
• 72.7% of Issues Advancing, 23.6% Declining
• 41 New 52-Week Highs, 115 New Lows
• 43.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 40.3%
• Bloomberg Global Risk-On/Risk-Off Index 1,871.0 +230.0 points
• Russell 1000: Growth/Value 18,115 -.85%
  
• Vix 28.0 -8.9%
• Total Put/Call .94 -19.0%
• TRIN/Arms .70 -29.3%

Monday Watch

Today's Headlines

Bloomberg:            

• Didi Sends Warning to China Investors Who Thought Worst Was Over.  
• China Braces for Evergrande Restructuring After Months of Tumult.    
• China’s Special Bonds Can’t Halt Property-Led Investment Slump.
• China Developer Sunshine 100 Defaults on $170 Million of Bonds. 
• Traders Dump Asean Stocks on Fears Omicron Will Hammer Region.
• Brii Says Covid Therapy Shows 80% Cut to Hospitalization, Death.
• Italy Reinforces Strict Covid Rules Targeting Vaccine Holdouts.      
• Hedge Funds Cut Yen Shorts by Most Since Pandemic on Omicron.  
• Stocks Fall on Virus Questions; Treasuries Slide: Markets Wrap.
• Abu Dhabi Stocks Lead Mideast Gains After Global Rout: Inside EM.  
• Saudis Raise Oil Prices for Asia, U.S. Despite Omicron’s Spread.
• Five Things You Need to Know to Start Your Day.
• Initial Hospital Data in Omicron Epicenter Shows Milder Disease.  
• Omicron Isn’t Fueling Surge in Hospitalizations: Virus Update.  
• Inflation, China and Virus: What to Watch in Stocks in 2022.
  
• Moderna’s Hoge Sees Risk Vaccines Will Struggle With Omicron.
• Shock to Crypto Daredevils Joins List of Scary Omens in Markets.
• Credit Funds Signal More Pain as Record Cash Swamps Treasury ETF.   
• U.S. Winds of Inflation Are Blowing Winter Gale: Eco Week Ahead.   
• Powell’s Fast-Taper Signal Presages Agile Fed on 2022 Rate Hikes.

Wall Street Journal:

• Small-Cap Stocks Hit Hard by Covid-19 Omicron Variant.
• Omicron May Cause Milder Illness, Study Finds. 
• Michael Bloomberg: Why I’m Backing Charter Schools. The public school system is failing. My philanthropy will give $750 million to a proven alternative. 
• Congress Races to Finish Legislation by Year-End. 
• Murder and Mandates in Chicago. Violence in the city soars as Mayor Lightfoot feuds with police. 
• California Dairy Farmers Struggle to Stay in the ‘Got Milk’ State. 
• CNN President Jeff Zucker Protected Chris Cuomo. Then Came a U-Turn. 
• Rogues Are on the March Around the World. Iran and Russia give every sign they don’t take President Biden seriously. 

Fox News:     

• New Chris Cuomo sexual misconduct allegation emerged days before CNN firing: report.
• Fauci reveals how officials really feel about Biden admin's African travel ban.

NY Post:

• Ghislaine Maxwell trial: Live updates from Day 5.

CNBC:

• Steve Cohen-backed start-up bets on 24-hour trading so investors can react instantly to tweets.
• As Google wades through fight over labor issues, ex-employees accuse company of mistreatment.
• Omicron Covid variant may have picked up a piece of the common-cold virus.
• Health experts debate using existing boosters against new, emerging Covid strains.
• Activist firm Engine reportedly pressures Kohl’s to consider sale of online biz.

Zero Hedge:

• Omicron: We Warned You The COVID Farce Would Never End.
• Omicron: More Transmissible, Less Severe Due To 'Common Cold' Mutation?
• Greenwald: To Deny "Lab Leak" COVID Theory, NYT & WaPo Use Dubious, Conflicted Sources.
• Slip Of The Tongue Temporarily Derails Ghislaine Maxwell Trial.
• After Sparks Fly At Bridgewater, Dalio 'Clarifies' His China Comments.
• China Poised To Establish 1st Ever Naval Base In Atlantic, Alarming US Officials.
• COVID Outbreak On US Cruise Ship Despite Fully Vaxxed Passengers.
• 'Never Seen Anything Like It': Los Angeles Residents Stunned As Violent Crimes Creep Into Wealthier Communities. 
• "Red Light Is Turning Green": Goldman Breaks Down Everything You Need To Know In The Market For December.
• 'Never Seen Anything Like It': Los Angeles Residents Stunned As Violent Crimes Creep Into Wealthier Communities.
• Hedge Fund CIO: No One On Earth Has Any Idea How Monetary Policy Can Alleviate Supply Chain Constraints.
• Fauci Downplays Severity Of Omicron Strain.
• Trump Social Media Venture Raises $1BN At Valuation Near $4BN.
• COVID Outbreak On US Cruise Ship Despite Fully Vaxxed Passengers.
• Watch: Paris Police Check Proof Of Vaccination While Diners Eat.
• Hedge Funds Are Driving Price Action In The Gold Market.
• Omicron Selloff, Is It Over Yet?
• The Geopolitical Game That Could Transform Gas Markets.
• Elon Musk Has Now Sold Over $10 Billion In Tesla Stock In Less Than A Month.
• Now Or Never: The Great 'Transition' Must Be Imposed.
•  US Companies Are "Hostages" To China.
• Goldman Senior Executives Are Searching For Ways To Quietly Boost Their Own Pay.
• Biden Infrastructure Bill Includes Passive Monitoring Vehicle "Kill Switch" Mandates For Automakers.

MarketWatch.com:        

• Opinion: The Nasdaq and the Dow are now trading in a way that was evident just before the internet bubble burst.
  
• Biden’s big social-spending bill probably will pass Senate this month without many cuts to it, analysts say.

NewsMax:

• Trump: Biden Might Take US to Point of No Return.

TheGatewayPundit.com:

• Senator Ron Johnson Says Many Americans Died From Covid Because Fauci ‘Sabotaged Early Treatment Using Cheap, “Let’s Go Brandon!” – Hundreds Take to the Streets of New York City to Protest Vaccine Mandates (VIDEO) Available, Generic Drugs’.
• “As the Descendent of a Survivor of German Concentration Camps, I Will Not Comply” – 4 Bristol Myers Employees Release Statement After Suing Company for Refusing Vaccine Religious Exemptions.
• Biden’s Surgeon General Says Triple Vaxxed People Should Wear Masks This Christmas (VIDEO).
• WATCH: Brian Stelter Asks Panel, ‘Has CNN Lost Trust?’
• Another Hoax: Crazy Teacher Confesses to Leaving Threatening Notes to Shoot Up Iowa School Where She Teaches.
•  “If We do Not Expose, and Peacefully Stand Against this Tyranny and Persecution, Your Life Will Soon Look like That of My Family” – Wife of J6 Political Prisoner Speaks Out.
• Democrat Politicians Renew Calls to Pack the Supreme Court, Add More Liberal Judges.
• FEDS ON PARADE: Dozens of Uhaul Trucks Picked Up Mysterious Patriot Protesters after Creepy March in DC — Another Democrat Stunt?
• UPDATE: New York Post Reporter Claims There Is More Behind Chris Cuomo’s Firing Than Is Being Reported…
• Supply Chain Issues Now Causing Shortages of Heart Medications, Antibiotics, Cancer Drugs.

The Epoch Times:

• Pentagon Chief Warns China’s Military Sorties Are ‘Like Rehearsal’ for Future Operations Against Taiwan.

Twitter:

• @apexwolrdnews - World Bank President David Malpass said: "Pfizer has been hesitant to go into some of the countries because of the liability problems, they don’t have a liability shield..." (video)
• @TrueNorthCentre - Beginning Saturday, people in New Brunswick who do not show proof of full vaccination can be barred from entering grocery stores to buy food.

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 indices are -.75% to -.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 93.5 +.5 basis point.
• China Sovereign CDS 52.5 -.25 basis point.
• Bloomberg Emerging Markets Currency Index 53.42 -.03%.
• Bloomberg Global Risk-On/Risk Off Index 1,683.0 +42.0 points.
• Volatility Index(VIX) futures 28.0 -2.3%. 
• Euro Stoxx 50 futures +.98%.
• S&P 500 futures +.45%.
• NASDAQ 100 futures +.06%.

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (SAIC)/1.46
  

After the Close:

• (CMTL)/-.22
• (COUP)/.02
• (HQY)/.35
• (MDB)/-.38
  

Economic Releases

• None of note

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone Factory Orders report, Capital One Energy Conference, Raymond James Tech Conference, UBS Media/Telecom/Tech Conference and the BofA Home Care Conference could also impact trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are mostly lower, weighed down by industrial and financial 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 week.