Morning Market Internals

NYSE Composite Index:

• Volume Running +23.3% Above 100-Day Average 
• 3 Sectors Rising, 7 Sectors Declining
• 28.3% of Issues Advancing, 68.4% Declining
• 42 New 52-Week Highs, 178 New Lows
• 41.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 45.6% 
• Bloomberg Global Risk-On/Risk-Off Index 3,460.0 +115.0 points
• Russell 1000: Growth/Value 16,681.0 +.68%
  
• Vix 25.7 +5.5%
• Total Put/Call .94 -13.8%
• TRIN/Arms .50 -51.9%

Friday Watch

Evening Headlines

Bloomberg:         

• Ukraine Briefing Spurs Greater Urgency on Sanctions in Congress.  
• Pelosi Warns U.S. Athletes Against Protests at Beijing Olympics.
  
• China’s Fake Snow Frenzy for Beijing Olympics Strains Water Supplies.  
• RBA Maps Out Route to Faster Inflation, Remains Patient on Rates.  
• Korea Inflation Stays High, Keeps Pressure on Central Bank.
• Futures Up, Stocks Steady as Amazon Calms Nerves: Markets Wrap.  
• Roaring Oil Market Heads for Seventh Weekly Gain as WTI Tops $90.
• Stomach-Churning Stock Swings Draw Red Line Under the Big in Big Tech.
  
• More Than 4,500 Flights Cancelled as Ice, Snow Move Across the U.S.  
• A Record 50% of U.S. Small Businesses Raised Wages in January to Lure Workers.  
• U.S. Soybeans Are in High Demand as Brazil’s Crop Falls Short.

Wall Street Journal:

• The Be More Like China Act. The House competition bill is industrial policy mixed with welfare.
• Covid-19 Vaccines Linked to Menstrual Cycle Changes.
• Oil Frackers Brace for End of the U.S. Shale Boom.
• Microsoft’s Videogame Boss and the Long Battle to Reinvent the Company.
• The Lockdown Catastrophe. Where are the public health benefits to justify Covid-era shutdowns and spending?
• As Inflation Soars, Central Banks Scramble to Lift Rates.
• Candy Makers Say Expect Shortages for Valentine’s Day.

Fox News:  

• Black voters sue NYC over noncitizen voting, claim it violates civil rights law.
• Cruz says you can trace every foreign crisis under Biden back to his policies.
• State's Black Caucus refuses to admit Republican delegate into their liberal ranks: 'Not Black enough'.
  

CNBC.com: 

• Ford shares fall after fourth-quarter earnings significantly miss Wall Street’s expectations. 
  
• Facebook’s $237.6 billion fall sets record for largest one-day value drop in stock market history.
• Senate GOP suggests Biden Federal Reserve nominee Raskin used government ties to help fintech firm.
• Stocks making the biggest moves after hours: Snap, Amazon, Ford and more.
• U.S. oil prices top $90 a barrel for the first time since 2014.

MarketWatch:       

• Facebook owner Meta loses record $232 billion in market value after ‘saying the quiet part out loud’.
  
• Facebook wasn’t Thursday’s only big loser — these 16 other Nasdaq-100 stocks dropped at least 5%.
  
• Pinterest posts first full-year profit and reaches more than $2 billion in sales in 2021, sending stock soaring.
  
• Snap shares soar over 50% on first profitable quarter.

Zero Hedge:

• Fundraising Campaign For Truckers Halted After Reaching $7.96 Million.
• The Roadmap To The Next Recession. 
• FDA Issues Warning On 2 Recalled COVID-19 Tests.
• JPMorgan's Trading Desk Scrambles To Contain The Fallout From Today's Crash.
• Attorneys Report Spike In Calls For Help From Families Of Patients Hospitalized With COVID-19.
• Tech Wreck Meta-stasizes To Broader Market; Credit Starts To Crack.
• Nomura's "Worst Case Scenario" Is Now In Play.
• BoJo's Government In Crisis As 4 Aides Quit After "Pedophile" Jab.
• Amazon Explodes 18% Higher On Prime Membership Increase, AWS Beat.
• Saskatchewan Premier Pledges To End All COVID Restrictions As Ottawa Braces For More Protests.
• Can Joe Rogan Save Free Speech?
• More p/l pain.

Newsmax:

• US Holds Off on Loosening COVID Limits, Even Amid Other Nations' Rollbacks.
• Sen. Braun: Putin 'Smells Weak US Hand' in Ukraine Crisis.

TheGatewayPundit.com: 

• Here’s How Democrats Plan to ‘Rig’ the 2022 Election to Keep Democrats in Majority and Pelosi Speaker.
• “When You’re Lying to the People and You’re the Media, It’s a Bad Business Model” — MUST SEE: AZ Gubernatorial Candidate Kari Lake ABSOLUTELY DESTROYS ABC Rookie Reporter in Attempted Hit Job (VIDEO).
• Pelosi Tells US Olympic Athletes in Beijing not to Speak Out Against the CCP, “Do Not Risk Incurring the Anger of the Chinese Government” (VIDEO).
• Country with High Vaccination Rate Has Highest Number of COVID Deaths Per Million People This Week.
• US Skier Eileen Gu Born in San Francisco Where They Teach You that America Sucks and Is Racist Will Compete for China at 2022 Olympics.
• BREAKING EXCLUSIVE: Lawrence Sellin Identifies Chinese Science Mole at the Highest Level of the National Institutes of Health (NIH).
• Teammates Are Uncomfortable – Teammate of Lia Thomas Says UPenn’s Trans Swimmer Doesn’t Cover Up Her P*nis While in Locker Room with Girls.
• ‘Border Czar’ Kamala Harris Unable to Answer For Biden’s Border Crisis When Asked, “What Has Gone Wrong?” (VIDEO).
• Arizona Senate Passes “No Men on Girls’ Sports Teams” Preventing Males From Competing In Women’s Sports – ALL Democrats Oppose.
• New Normal: 21-Year-Old Greek Football Player Dies on the Pitch Following Cardiac Arrest. 
• El Salvador President Asks if the Destruction of United States is Done Intentionally.
• “How Many More Until We’re All Grieving” – 28-Year-Old Woman Speaks Out After Suffering Functional Neurological Disorder Following Pfizer Vaccination.

The Epoch Times:

• ‘Most Debased Demonstrations of Evil’: Bill Aims to End CCP’s Persecution of Falun Gong.
• The CCP ‘Will Kill as Many as It Has to Kill, to Preserve Its Power’: Historian.

Twitter: 

• @BeachLife7 - Truckers still out in Ottawa protesting covid tyranny. They are not leaving any time soon. #TruckersForFreedom #TruckersForFreedom2022 #truckers. (video)

GETTR:

• @DiscloseTV - NEW - IRS is collaborating with ID.me, a startup that could create a huge new pool of Americans' personal data for police and other authorities to tap into. NEW - Cross-sectional study finds evidence of natural immunity in unvaccinated healthy US adults up to 20 months after confirmed COVID-19 infection.

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 -.5% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 91.25 +.5 basis point. 

• China Sovereign CDS 50.25 +.25 basis point.
  

• Bloomberg Emerging Markets Currency Index 54.42 +.01%. 
• Bloomberg Global Risk-On/Risk Off Index 3,363.0 +18.0 points.
• Volatility Index(VIX) futures 25.3 -3.1%.
• Euro Stoxx 50 futures -.17%.

• S&P 500 futures +.86%.

• NASDAQ 100 futures +1.55%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (APD)/2.50
• (BMY)/1.80
• (CBOE)/1.54
• (ETN)/1.71
• (REGN)/19.41
• (RCL)/-3.92

After the Close:

• None of note
  

Economic Releases

8:30 am EST

• The Change in Non-Farm Payrolls for Jan. is estimated to fall to +150K versus +199K in Dec.
• The Unemployment Rate for Jan. is estimated at 3.9% versus 3.9% in Dec.
• Average Hourly Earnings MoM for Jan. is estimated to rise +.5% versus a +.6% gain in Dec. 
• The Labor Force Participation Rate for Jan. is estimated at 61.9% versus 61.9% in Dec.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone Factory Orders report could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly lower, weighed down by commodity and technology 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.

Stocks Falling Substantially into Afternoon on US Policy-Induced Stagflation Fears, Escalating Russia/Ukraine Tensions, Technical Selling, Tech/Alt Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line:  Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume:  Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 24.0 +8.7%
• Bloomberg Global Risk On/Risk Off Index 3,388.0 +6.0 points

• Euro/Yen Carry Return Index 135.44 +1.6%

• Emerging Markets Currency Volatility(VXY) 9.2 -.4%

• CBOE S&P 500 Implied Correlation Index 38.60 +16.0% 

• ISE Sentiment Index 83.0  -2.0 points
  

• Total Put/Call 1.07 +11.5%

• NYSE Arms .87 -13.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 62.64 +5.2%
  

• US Energy High-Yield OAS 403.41 +.71%

• European Financial Sector CDS Index 70.24 +7.8%

• Italian/German 10Y Yld Spread 150.0 +11.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 90.55 -.6%
  

• Emerging Market CDS Index 210.50 +2.4%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 31.69 +.05% 
• Ukraine Sovereign Debt Credit Default Swap 741.11 +1.4%
  

• 2-Year Swap Spread 16.5 +.5 basis point
  

• TED Spread 11.5 -.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -12.0 unch.
  
• MBS  5/10 Treasury Spread  86.5 +.5 basis point
  
• IHS Markit CMBX BBB- 6 75.25 +.5 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 54.42 -.11%
• 3-Month T-Bill Yield .19% +1.0 basis point
  

• Yield Curve 63.0 unch.
  

• China Iron Ore Spot 145.35 USD/Metric Tonne +.4%

• Citi US Economic Surprise Index -5.3 +1.5 points

• Citi Eurozone Economic Surprise Index 58.10 -8.3 points
  

• Citi Emerging Markets Economic Surprise Index 30.10 +.5 point

• 10-Year TIPS Spread 2.40 -3.0 basis points
  
• 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:

• 822 new infections/100K people(last 7 days total). 48.0%(-6.0 percentage points) of 1/14 peak -102/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -22.7%(unch.) from peak 7-day avg. of 1/9/21 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -136 open in Japan 
• China A50 Futures: Indicating +157 open in China

• DAX Futures: Indicating -15 open in Germany

Portfolio:

• Lower: On losses in my industrial/commodity/tech/transport sector longs
  

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges, took profits in my transport longs
  

• Market Exposure:  Moved to 25% Net Long
  

Bear Radar

Style Underperformer:

• Large-Cap Growth -3.0%

Sector Underperformers:

• 1) Social Media -6.9% 2) Alt Energy -3.5% 3) Semis -3.0%

Stocks Falling on Unusual Volume: 

• QCOM, BEPC, PAR, RRX, CEQP, IRDM, FORM, CCCC, SMG, NEP, FTV, MUSA, CSII, PYPL, CI, EL, CRM, HON, TWTR, LNC, PACK, CG, OHI, TXN, ABMD, AMZN, INGR, CTRN, DV, NOVA, AZEK, TGTX, RBLX, BV, ETSY, QRVO, DUOL, PINS, SQ, XYL, WRBY, LITE, MP, SNAP, FB and SITM
  

Stocks With Unusual Put Option Activity:

• 1) AX 2) IPO 3) FB 4) HON 5) SNAP
  

Stocks With Most Negative News Mentions:

• 1) FB 2) ELMS 3) SNAP 4) MP 5) SPOT
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value -.8%

Sector Outperformers:

• 1) Telecom +.8% 2) Healthcare Providers +.6% 3) Foods +.1%

Stocks Rising on Unusual Volume:

• MOD, DXC, TMUS, MDGL, SKY, ADTN, HUM, RL and KOD
  

Stocks With Unusual Call Option Activity:

• 1) ELY 2) TMUS 3) DVAX 4) EXC 5) FB

Stocks With Most Positive News Mentions:

• 1) DXC 2) IMKTA 3) MCFT 4) RL 5) ITW
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +1.7% Above 100-Day Average 
• 1 Sector Rising, 10 Sectors Declining
• 22.1% of Issues Advancing, 74.8% Declining
• 41 New 52-Week Highs, 94 New Lows
• 39.9% of Issues Above 200-day Moving Average
• Average 14-Day RSI 45.9% 
• Bloomberg Global Risk-On/Risk-Off Index 3,464.0 +82.0 points
• Russell 1000: Growth/Value 16,684.0 -1.91%
  
• Vix 22.9 +3.7%
• Total Put/Call 1.02 +6.3%
• TRIN/Arms .80 -20.0%