Bull Radar

Style Outperformer:

• Mid-Cap Value +.4%

Sector Outperformers:

• 1) Disk Drives +1.7% 2) Computer Hardware +1.1% 3) Homebuilding +1.1%

Stocks Rising on Unusual Volume:

• ARHS, CALX, VSCO, METC, CTRN, WDC, FIVE, EGLE, SEMR, CNM, BBIO, DKS, AOSL, MU and CONN
  

Stocks With Unusual Call Option Activity:

• 1) SRTY 2) BDSI 3) AEO 4) XLI 5) WDC

Stocks With Most Positive News Mentions:

• 1) CALX 2) VSCO 3) PIXY 4) MU 5) WDC
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -26.6% Below 100-Day Average 
• 8 Sectors Rising, 3 Sectors Declining
• 51.9% of Issues Advancing, 43.5% Declining
• 99 New 52-Week Highs, 75 New Lows
• 51.9% of Issues Above 200-day Moving Average
• Average 14-Day RSI 50.4% 
• Bloomberg Global Risk-On/Risk-Off Index 3,194.0 +100.0 points
• Russell 1000: Growth/Value 18,308 -.38%
  
• Vix 17.5 -.5%
• Total Put/Call .93 +27.4%
• TRIN/Arms 1.47 +20.5%

Wednesday Watch

Night Trading 

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 82.75 +2.75 basis points. 

• China Sovereign CDS 41.5 unch.
  

• Bloomberg Emerging Markets Currency Index 55.20 -.17%. 
• Bloomberg Global Risk-On/Risk Off Index 3,111.0 +15.0 points.
• Volatility Index(VIX) futures 20.5 -.39%.
• Euro Stoxx 50 futures -.01%.

• S&P 500 futures +.20%.

• NASDAQ 100 futures +.38%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• None of note
  

After the Close:

• (FCEL)/-.04
  

Economic Releases

8:30 am EST

• Advance Goods Trade Balance for Nov. is estimated to widen to -$88.3B versus -$82.9B in Oct.
• Wholesale Inventories MoM for Nov. is estimated to rise +1.5% versus a +2.3% gain in Oct.
• Retail Inventories MoM for Nov. is estimated to rise +.5% versus a +.1% gain in Oct.
• Pending Home Sales MoM for Nov. is estimated to rise +.7% versus a +7.5% gain in Oct.
  

10:00 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -3,166,000 barrels versus a -4,715,000 barrel decline the prior week. Gasoline supplies are estimated to rise by +600,880 barrels versus a +5,533,000 barrel gain the prior week. Distillate inventories are estimated to fall by -178,250 barrels versus a +396,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.15% versus a -.2% decline prior.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Japan industrial data report and the weekly MBA mortgage application reports could also impact global trading today.

US Equity Market Hours

• 9:30 am - 1:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and commodity shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.

Stocks Slightly Lower into Final Hour on Global Virus Mandate/Lockdown Fears, Dollar Strength, Profit-Taking, Tech/Biotech Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line:  Substantially Lower
  

• Sector Performance:  Mixed
  

• Volume:  Light

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 18.2 +2.8%
• Bloomberg Global Risk On/Risk Off Index 3,073.0 +43.0 points

• Euro/Yen Carry Return Index 133.70 -.30%

• Emerging Markets Currency Volatility(VXY) 11.1 +.4%

• CBOE S&P 500 Implied Correlation Index 27.3 +1.9% 

• ISE Sentiment Index 116.0  -21.0 points
  

• Total Put/Call .70 -10.3%

• NYSE Arms 1.2 +25.8%

Credit Investor Angst:

• North American Investment Grade CDS Index 49.68 +1.3%
  

• US Energy High-Yield OAS 390.0 -.32%

• European Financial Sector CDS Index 55.39 -.45%

• Italian/German 10Y Yld Spread 133.0 -4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 79.25 -.96%
  

• Emerging Market CDS Index 190.60 -.20%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 33.06 unch.

• 2-Year Swap Spread 18.5 -4.5 basis points
  

• TED Spread 16.5 +.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -2.75 +.25 basis point
  
• MBS  5/10 Treasury Spread  72.0 +3.25 basis points
  
• IHS Markit CMBX BBB- 6 72.25 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 55.22 -.62%
• 3-Month T-Bill Yield .04% unch.
  

• Yield Curve 73.0 -6.0 basis points
  

• China Iron Ore Spot 117.60 USD/Metric Tonne -1.0%

• Citi US Economic Surprise Index 21.7 -1.2 points

• Citi Eurozone Economic Surprise Index 27.8 +.8 point
  

• Citi Emerging Markets Economic Surprise Index -4.4 -2.3 points

• 10-Year TIPS Spread 2.53 +1.0 basis point
• 39.8%(-1.8 percentage points) chance of no change at March 16th FOMC meeting, 25.7%(-1.2 percentage points) chance of no change at May 4th meeting

US Covid-19:

• 506 new infections/100K people(last 7 days total) +68/100K people
• 95% of Jan. 7th, 2021 peak(highest daily avg. new infections) +13.0 percentage points
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -49 open in Japan 
• China A50 Futures: Indicating +38 open in China

• DAX Futures: Indicating -25 open in Germany

Portfolio:

• Slightly Lower: On losses in my tech/medical sector longs

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges
  

• Market Exposure:  Moved to 75% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Growth -.9%

Sector Underperformers:

• 1) Alt Energy -2.1% 2) Steel -1.7% 3) Video Gaming -1.2%

Stocks Falling on Unusual Volume: 

• APPS and QDEL
  

Stocks With Unusual Put Option Activity:

• 1) FINX 2) KBH 3) FCEL 4) APPS 5) WW
  

Stocks With Most Negative News Mentions:

• 1) RDW 2) CEI 3) FFIE 4) COIN 5) BXSL
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value +.3%

Sector Outperformers:

• 1) Airlines +1.2% 2) Hombuilding +.9% 3) Utilities +.8%

Stocks Rising on Unusual Volume:

• BBIO, DNUT, STRO, TWI, CONN, ALNY and RAD
  

Stocks With Unusual Call Option Activity:

• 1) BLOK 2) AEO 3) IFF 4) APPS 5) SJM

Stocks With Most Positive News Mentions:

• 1) ISIG 2) YOU 3) PSX 4) SBUX 5) STT
  

Charts:

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