Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +8.2% Above 100-Day Average 
• 9 Sectors Rising, 2 Sectors Declining
• 39.7% of Issues Advancing, 56.8% Declining
• 50 New 52-Week Highs, 32 New Lows
• 38.5% of Issues Above 200-day Moving Average
• Average 14-Day RSI 44.1% 
• Bloomberg Global Risk-On/Risk-Off Index 3,369.0 +33.0 points
• Russell 1000: Growth/Value 16,994.0 -.21%
  
• Vix 22.0 +.05%
• Total Put/Call 1.02 +7.4%
• TRIN/Arms 1.50 +64.0%

Wednesday Watch

Evening Headlines

Bloomberg:     

• U.K. Retailers Raise Prices at Fastest Pace Since 2012, BRC Says.
• Stocks, Futures Rise on Earnings, Easing Fed Angst: Markets Wrap.
• Oil Holds Near Seven-Year High as Traders Count Down to OPEC+.
• OPEC Barely Increased Supply Last Month Amid Chronic Struggles  
• Goldman Sees QT Fueling Treasury Volatility and Hurting Liquidity.
• CME to Launch More Battery-Metals Contracts as Demand Surges.   
• Fewest Americans Ever Are Laid Off in Frenzy to Retain Workers.  
• Ford to Spend Up to $20 Billion Reorganizing for Shift to Electric Cars.  
• Fed Won’t Be Rushed in Its Hiking Path by Wall Street Frenzy.
• Invesco to Hire Dozens in China as Assets Sail Past $100 Billion.
• Biden Consults With Key Senators on Supreme Court Nominee.  
• A Major Homebuilder Sees No Improvement Coming to the Supply Chain In 2022.  
• Anxiety Over Beef Shortages Reaches Fever Pitch in Golden Corral Fistfight.

Wall Street Journal:

• Putin Says West Failed to Address His Demands in Ukraine Standoff.
• Russia Confronts Ukraine With Upgraded Military Rebuilt After Soviet Collapse.
• Brian Flores Sues NFL Alleging Discrimination Against Black Coaches. 
• Biden’s Southern Border Crisis Isn’t Going Away. The administration lets a crisis fester, and the Democratic Party will pay a political price. 
• VR to the ER: Metaverse Early Adopters Prove Accident-Prone.

Fox News:

• College shooter kills beloved campus security officers, suspect arrested after massive manhunt.
• Fraternal Order of Police accuses White House press secretary Psaki of laughing off rising crime rates.
• 'Squad,' Dems mum on police funding as crime continues to rise in major cities.
• Top schools ditch vaccine mandates instant new GOP AG turns up heat.

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.  
  

CNBC.com:

• AMD rises 10% after issuing strong 2022 sales outlook.
• GM forecasts earnings ‘at or near record levels’ in 2022 as chip shortage eases.
• Alphabet reports big fourth-quarter beat; stock pops.
• After a huge year for growth, the U.S. economy is about to slam into a wall.
• Pfizer asks FDA to expand use of Covid vaccine to kids under 5.
• Stocks making the biggest moves after hours: Alphabet, AMD, PayPal and more.

MarketWatch:     

• Gilead earnings slammed by legal settlement, stock falls.
• PayPal stock drops as eBay impacts weigh on earnings outlook.
  
• Starbucks to raise prices as inflation, labor issues hit earnings.  
• Watch: 40-person brawl breaks out in Golden Corral over reported steak shortage.  
• With chicken wing prices rising by as much as 26%, will Super Bowl parties still be happening?

Zero Hedge:

• Quebec Scraps Planned Tax On Unvaccinated Residents Amid Growing Backlash.
• Bill Maher Is Right: It's The Left That Has Gotten More Radical. 
• Taibbi: The British Medical Journal Story That Exposed Politicized "Fact-Checking".
• 500 Dead In Northeast Syria "Major ISIS Comeback Plot".
• San Francisco Residents Flocking To Montana As Demand Has "Exploded".
• Ukraine Drone Strike Kills Separatist Fighter At Donbas Front Line: Russian Media.
• Illinois Democrat Rep. Calls For "Quarantine To Observe" Those Refusing Vaccines.
• WTI Dips After Gasoline Inventories Build For 5th Straight Week.
• Alphabet Explodes 7% Higher After Beating Estimates Across The Board, 20-For-One Stock Split.
• These Were The Best And Worst Performing Assets During January's Rollercoaster Month.
• Fourth Turning 2022: Bad-Moon Rising, Part 3.
• Stocks Shrug Off Bullard, Bad-Data, & 'BBB' Bust As Dollar Drops.

Newsmax:

• FIRE Poll: Majority Say Cancel Culture Rising Threat to Freedom.
• Sen. Blackburn: Beijing Focused on Propaganda Olympics Brings.

TheGatewayPundit.com: 

• Senator Ben Ray Luján Hospitalized After Suffering a Stroke.
• Biden’s Nominee to be Judge of Central District of California Won’t Answer Whether Racial Discrimination is Wrong Under Questioning From Ted Cruz (VIDEO).
• Outraged Citizens Surround Pfizer Headquarters In Paris: ‘Assassins!’ (VIDEO).
• BREAKING: Key Evidence Uncovered Shows State Dept Thought Ukrainian Prosecutor Shokin Was a Good Guy and Yet Biden Bragged About Firing Him Because He Was Investigating Hunter, Biden’s Son.
• Illinois HB4244 Mandatory Vaccine Registry is Now in Subcommittee – Lawmaker Proposes HB4640 to Quarantine Exposed to Infectious Disease.
• Biden Regime RESCINDS Deportation of Illegal Alien Who Killed 19-Year-Old Girl in New Program to Reduce Removals.

The Epoch Times:

• Fauci Knew About Virus Lab Origin From Secret Teleconference, Pushed Alternate Narrative: Jeff Carlson and Hans Mahncke.

Twitter: 

• @ProtestNews_EN - All Canadians want their freedom. (video) #Truckers #Ottawa #FreedomConvoy #Canada. The vibe in Canada is just amazing! Nice message to Australia as well! (video)
  
• @TheChiefNerd - Johns Hopkins Professor Dr. Marty Makary on new data showing the superiority of natural immunity “The NIH controls the currency of academic medicine”. (video)
• @TomasMorales_iv - Gavin Newsom unmasked in a packed stadium while the state of CA still has emergency orders in place for Covid-19. (pic)
  

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 739,999 Reports(+7,117 from prior week) Through January 21, 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 +1.0% to +1.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 91.0 unch. 

• China Sovereign CDS 50.0 unch.
  

• Bloomberg Emerging Markets Currency Index 54.49 -.02%. 
• Bloomberg Global Risk-On/Risk Off Index 3,375.0 +39.0 points.
• Volatility Index(VIX) futures 23.7 -.9%.
• Euro Stoxx 50 futures +.75%.

• S&P 500 futures +.45%.

• NASDAQ 100 futures +.95%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (ABBV)/3.28
• (ABC)/2.58
• (AVY)/2.12
• (BSX)/.44
• (EAT)/.51
• (CHRW)/1.86
• (DHI)/2.80
• (EMR)/1.01
• (HUM)/1.16
• (IDXX)/1.72
• (JCI)/.53
• (ODFL)/2.27
• (SAIA)/2.58
• (TMO)/5.27

After the Close:

• (AFL)/1.26
• (ALGN)/2.73
• (ALL)/2.77
• (AVB)/2.25
• (CTSH)/1.04
• (KLIC)/1.90
• (MXL)/.84
• (MCK)/5.42
• (FB)/3.83
• (MET)/1.46
• (QCOM)/3.00
• (RRR)/.51
• (YELL)/-.13
  

Economic Releases

8:15 am EST

• The ADP Employment Change for January is estimated to fall to 184K versus 807K in Dec.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory  gain of +1,055,890 barrels versus a +2,377,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +1,895,220 barrels versus a +1,297,000 barrel gain the prior week. Distillate inventories are estimated to fall by -1,237,000 barrels versus a -2,798,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.01% versus a -.4% decline prior.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone PPI report and the weekly MBA Mortgage Applications report could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

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

Stocks Slightly Higher into Final Hour on Diminishing Global Lockdown/Mandate Fears, Technical Buying, Short-Covering, Commodity/Financial Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line:  Substantially Higher
  

• Sector Performance: Mixed
  

• Volume:  Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 23.5 -5.5%
• Bloomberg Global Risk On/Risk Off Index 3,236.0 +98.0 points

• Euro/Yen Carry Return Index 132.97 -.23%

• Emerging Markets Currency Volatility(VXY) 9.3 -1.2%

• CBOE S&P 500 Implied Correlation Index 39.8 -2.4% 

• ISE Sentiment Index 84.0  -4.0 points
  

• Total Put/Call .92 -12.4%

• NYSE Arms .76 -25.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 58.4 -1.3%
  

• US Energy High-Yield OAS 406.71 -2.1%

• European Financial Sector CDS Index 65.76 -2.0%

• Italian/German 10Y Yld Spread 138.0 +10.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 91.18 -.04%
  

• Emerging Market CDS Index 212.32 +.03%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 31.71 +.32% 
• Ukraine Sovereign Debt Credit Default Swap 770.99 -2.2%
  

• 2-Year Swap Spread 15.5 unch.
  

• TED Spread 10.5 -3.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -12.75 unch.
  
• MBS  5/10 Treasury Spread  87.0 +3.75 basis points
  
• IHS Markit CMBX BBB- 6 74.75 +.25 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 54.47 +.04%
• 3-Month T-Bill Yield .20% +2.0 basis points
  

• Yield Curve 60.5 +1.0 basis point
  

• China Iron Ore Spot 138.90 USD/Metric Tonne +.3%

• Citi US Economic Surprise Index -5.4 +1.3 points

• Citi Eurozone Economic Surprise Index 46.7 -4.7 points
  

• Citi Emerging Markets Economic Surprise Index 31.70 -1.2 points

• 10-Year TIPS Spread 2.46 +1.0 basis point
  
• 0.0%(unch.) chance of no change at May 4th FOMC meeting, 0.0%(unch.) chance of no change at June 15th meeting

US Covid-19:

• 983 new infections/100K people(last 7 days total). 57.0%(-6.0 percentage points) of 1/14 peak -105/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -20.8%(-3.1 percentage points) from peak 7-day avg. of 1/9/21 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -18 open in Japan 
• China A50 Futures: Indicating +121 open in China

• DAX Futures: Indicating -18 open in Germany

Portfolio:

• Higher: On gains in my industrial/commodity/transport sector longs
  

• Disclosed Trades:  None
  

• Market Exposure:  75% Net Long
  

Bear Radar

Style Underperformer:

• Large-Cap Value unch.

Sector Underperformers:

• 1) Utilities -1.6% 2) Healthcare Providers -1.0% 3) REITs -1.0%

Stocks Falling on Unusual Volume: 

• PCH, EPC, MCY, T, PCG, CRUS, CLFD, MDC, KMPR, AVXL and XMTR
  

Stocks With Unusual Put Option Activity:

• 1) GES 2) CERN 3) PCG 4) VNQ 5) AFL
  

Stocks With Most Negative News Mentions:

• 1) KSCP 2) KMPR 3) CRUS 4) MDC 5) PBI
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +.8%

Sector Outperformers:

• 1) Oil Service +3.8% 2) Steel +3.7% 3) Energy +3.0%

Stocks Rising on Unusual Volume:

• UPS, ORMP, IMUX, BROS, AMC, FUN, SRRA, CBT, SOFI, WEBR, MOS, TECH, BJRI, XOM, NOG, DKNG, CUK, CERE, SANM, ENTG, PLUG, YMAB, ARCB, PLTR, INSM, NET, FIBK, SQ, MTTR, CTLT, SIX, CNX, HMHC, WBS, HOOD, TREX, NFLX, IIIV and FDX
  

Stocks With Unusual Call Option Activity:

• 1) SIRI 2) UPS 3) UNFI 4) SLCA 5) KOS

Stocks With Most Positive News Mentions:

• 1) UPS 2) CBT 3) RXMD 4) ARCB 5) MLI
  

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +28.8% Above 100-Day Average 
• 4 Sectors Rising, 7 Sectors Declining
• 50.6% of Issues Advancing, 40.2% Declining
• 40 New 52-Week Highs, 26 New Lows
• 34.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 39.9% 
• Bloomberg Global Risk-On/Risk-Off Index 3,189.0 +52.0 points
• Russell 1000: Growth/Value 16,972.0 -.32%
  
• Vix 24.4 -1.9%
• Total Put/Call .85 -19.0%
• TRIN/Arms .80 -21.6%