Morning Market Internals

NYSE Composite Index:

• Volume Running +31.5% Above 100-Day Average 
• 11 Sectors Rising, 0 Sectors Declining
• 66.9% of Issues Advancing, 29.3% Declining
• 79 New 52-Week Highs, 54 New Lows
• 39.2% of Issues Above 200-day Moving Average
• Average 14-Day RSI 45.8% 
• Bloomberg Global Risk-On/Risk-Off Index 2,704.0 +352.0 points
• Russell 1000: Growth/Value 16,387.0 -.82%
  
• Vix 31.7 -5.0%
• Total Put/Call .86 -3.4%
• TRIN/Arms 1.03 -24.8%

Wednesday Watch

Evening Headlines

Bloomberg:        

• Ukraine Faces More Brutal Form of War as Russia Regroups.
  
• Ukraine War Bonds That Pay 11% Are a Risky Bet Investors Want to Buy.
• U.S. to Bar Russia Flights; United Reroutes Jets: Ukraine Update.  
• Whether They Back War or Not, Russian Billionaires Hit by EU.
• Australia’s Economy Rebounds on Consumer Spending Bonanza.  
• U.K. Consumers Told to Brace for Further Price Increases.
• Most Asian Stocks Fall as Oil’s Surge Dims Outlook: Markets Wrap.
  
• Oil Pushes Higher Before OPEC+ Meeting as IEA Warns of Crisis.
  
• OPEC Output Rose Last Month Amid Recovery in Embattled Libya.
  
• Commodities Jump Most Since 2009 as Ukraine War Threatens Supply.  
• Hackers Stole Nvidia Data, Posted It Online.  
• U.S. Beef Prices Are Set to Rise Further as Ranchers’ Costs Soar. 
• Alcoa CEO Affirms Promise of No New Aluminum Smelters.  
• Growth Angst Shakes Markets Already Obsessed With Inflation Risk.

Wall Street Journal:

• Russia Targets Ukrainian Civilian Areas in Tactical Shift.
• Live Updates.
• Russia Scrambles to Maintain Oil Sales, Lifeblood of Economy.
• Food Shortages, Last Goodbyes: Ukrainians Face Their New Reality.
• U.S. Says It Is Realigning Its China Trade Policy.
• Car Dealerships Don’t Want Your Cash—They Want to Give You a Loan.
• The Teen Who Tracks Musk’s Plane Is Now Monitoring Russian Oligarchs, Putin.
• A Lesson in Energy Masochism. Here’s how Europe made itself vulnerable to Putin’s gas blackmail.
• Jonesing to Give Up Russian Oil. Hawaii imports Moscow crude, and the Jones Act is one bad reason why. 

Fox News:  

• Massive Russian convoy spotted outside Kyiv as Ukraine and Russia continue battling for sixth day.
• Jill Biden's State of the Union guest supports critical race theory.

CNBC.com:

• Nordstrom stock spikes 35% as retailer makes key strides in its off-price Rack business, issues strong guidance.
• Salesforce reports better-than-expected earnings and revenue, issues upbeat guidance.
• MLB cancels Opening Day and some regular-season games after owners fail to reach deal with players.
• Target thinks it can keep growing sales — here’s how the retailer plans to do it.
• With inflation and Ukraine, Powell must thread a needle on Capitol Hill this week to calm markets.
• First Solar shares sink after revenue miss, disappointing guidance.

MarketWatch:   

• Fiona Hill warns Putin would use nuclear weapons: ‘If he has an instrument, he wants to use it’.
• Rivian raises EV prices, citing inflation, supply-chain problems.
• Mastercard says about 4% of its revenue was related to Russia in 2021.
• Exxon Mobil to exit major Russian venture, will not invest in new developments.

Zero Hedge:

• "Game Over?" - Russia To Be In Technical Default Within Hours.
• "The Market Is Starting To Fail": Buyers Balk At Russian Oil Purchases Despite Record Discounts, Sanction Carve Outs.
• Is COVID Policy Comedy, Tragedy, Or Both?
• Apple, Ford Lead Latest Round Of US Companies Cutting Russia Ties.
• Ukraine's 2nd Largest City Pummeled Under Russian Strikes As Calls For Western Intervention Grow.
• The Real State Of The Union.
• New Yorkers Lash Out At ConEdison Over Soaring Electricity Bills.
• Summers: Biden Needs To Pivot From COVID, Prepare America For 'Struggle Ahead'.
• GM Sold Their 7.5 Million Share Stake In Lordstown Motors In Q4.
• "We May Have To Supply Europe": Lawmakers Pressure Biden To Halt Russian Oil Imports, Boost Production.
• Tanker Rates On Russian Crude Route Soars Nine-fold In Three Days.
• WTI Extends Gains After Huge Surprise Crude Draw.
• Panic Tuesday - vol explosions, evaporated liquidity and VaR shocks.
• Stocks Slammed As Bonds, Bitcoin, Bullion, & Black Gold Soar.

Newsmax:  

• GOP Slams Biden for Not Halting Russian Oil.  
• Ban on Russian Flights From US Airspace Imminent: Sources.

TheGatewayPundit.com: 

• “No One Is Going to Break Us. We’re Strong. We’re Ukrainians” – Ukrainian President Zelensky Receives Standing Ovation After Addressing the European Union from Kiev (VIDEO).
• BREAKING: Wisconsin Special Counsel Michael Gableman Calls for Decertification of Wisconsin 2020 Election Results (VIDEO).
• Pelosi Claims Americans Have a Low Opinion of Joe Biden Because They are Ignorant (VIDEO)
• St. Louis Welcomes US Trucker Convoy on Way to Indianapolis – Huge Crowds at Overpasses.
• BODY CAM FOOTAGE: Dominion Executive Eric Coomer Cuffed and Arrested in Colorado – Video Appears to Show He Drove Truck into Bar, Fled the Scene and Lied to Police.
• Facebook’s Zuckerberg’s Election Money Violated Bribery Laws – Former Wisconsin Supreme Court Justice Shares from His Investigation of 2020 Election.
• BOOM! Wisconsin Special Counsel Implicates Obama Campaign Manager David Plouffe and ERIC’s David Becker in Wisconsin Election Fraud Investigation.
• Too Bad for Ukraine — Joe Biden Left $84 Billion in US Arms to Taliban Terrorists in Afghanistan During Surrender — Only a Few Million for Zelensky.
• EXPLOSIVE: Justice Gableman Reveals MASSIVE Voter Fraud in Wisconsin Nursing Homes — 100% Turnout in Zuckerberg-Funded Wisconsin Cities! – SHOCKING VIDEO.
• Steve Cortes: “Chance of Nuclear Episode Higher than Any Time since Cuban Missile Crisis – We Have Dropped a Financial Dirty Bomb on the Russian People” (VIDEO).

The Epoch Times:

• ‘None of Us Should Ever Buy Another Product Made in Communist China’: Sen. Scott on Holding CCP Accountable for Abuses.

Twitter: 

• @aginnt - The US Freedom Convoy. (video) 
• @zerohedge - "They Actually Want Russia To Invade" - Beijing Slams Biden For Allegedly Provoking Putin. These Are The Global Banks With The Largest Exposures To Russian Sanctions.
• @StateOfUkraine - As a result of shelling of Kharkiv, #Ukraine city where Russians expected an easy victory due to support from the population, dozens civilians were injured, inc. a woman's leg was torn off, at least 11 died. #Russia is successfully destroying any pro-Russian sentiment in Ukraine. (video)
  
• @JohnnyMercerUK - No expert, but the invasion doesn’t seem to be going particularly well. Ukrainian tractor steals Russian APC today. (video)
• @MerissaHansen17 - This is extremely alarming.
• @The_Real_Fly - SCENE IN UKRAINE. (video) NOT A MOVIE — SCENE IN UKRAINE. (video)
  

GETTR:

• @DiscloseTV - NEW - England revokes Covid vaccination as a condition of deployment across all health and social care.

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 767,082 Reports(+6,981 from prior week) Through February 18th, 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 111.25 +1.0 basis point. 

• China Sovereign CDS 61.5 -1.25 basis points.
  

• Bloomberg Emerging Markets Currency Index 52.18 -.09%. 
• Bloomberg Global Risk-On/Risk Off Index 2,410.0 +68.0 points.
• Volatility Index(VIX) futures 30.2 -1.6%.
• Euro Stoxx 50 futures +.09%.

• S&P 500 futures +.34%.

• NASDAQ 100 futures +.31%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (ANF)/1.27
• (DLTR)/1.77
• (DCI)/.62
• (DY)/-.09
• (KFY)/1.48
• (PDCO)/.50
  

After the Close:

• (AEO)/.35
• (PLAN)/-.10
• (BOX)/.23
• (AI)/-.26
• (CHPT)/.16
• (OKTA)/-.24
• (SPLK)/-.20
• (VSCO)/2.63
  

Economic Releases

8:15 am EST

• The ADP Employment Change for Feb. is estimated to rise to 375K versus -301K in Jan.
  

2:00 pm EST

• US Fed Beige Book release.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Powell testifying to House, German retail sales report, weekly MBA Mortgage Applications report, BofA Ag/Materials Conference, (C) investor day and the (XOM) investor day 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 technology and financial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 50% net long heading into the day.

Stocks Falling Substantially into Final Hour on Russia/Ukraine War Escalation Fears, US Policy-Induced Stagflation Worries, Surging European/Emerging Markets Debt Angst, Financial/Airline Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line:  Substantially Lower
  

• Sector Performance:  Almost Every Sector Declining
  

• Volume:  Heavy

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 34.9 +15.9%
• Bloomberg Global Risk On/Risk Off Index 2,203.0 -667.0 points

• Euro/Yen Carry Return Index 131.39 -1.0%

• Emerging Markets Currency Volatility(VXY) 11.2 +5.3%

• CBOE S&P 500 Implied Correlation Index 51.2 +10.7% 

• ISE Sentiment Index 120.0 +7.0 points
  

• Total Put/Call .91 -2.2%

• NYSE Arms 1.4 +4.6%

Credit Investor Angst:

• North American Investment Grade CDS Index 71.2 +5.5%
  

• US Energy High-Yield OAS 434.74 +2.8%

• European Financial Sector CDS Index 87.94 +7.9%

• Italian/German 10Y Yld Spread 147.0 -10.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 112.46 +.17%
  

• Emerging Market CDS Index 303.79 +5.2%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 30.39 -.49% 
• Ukraine Sovereign Debt Credit Default Swap 2,937.75 +.12%
  

• 2-Year Swap Spread 12.5 +6.0 basis points
  

• TED Spread 20.75 -2.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -36.75 +4.75 basis points
  
• MBS  5/10 Treasury Spread  103.0 +2.0 basis points
  
• iShares CMBS ETF 51.78 +.95%
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 51.99 -1.09%
• 3-Month T-Bill Yield .30% unch.
  

• Yield Curve 40.0 -1..5 basis points
  

• China Iron Ore Spot 149.2 USD/Metric Tonne +1.4%

• Citi US Economic Surprise Index 40.1 +2.2 points

• Citi Eurozone Economic Surprise Index 67.0 -.8 point
  

• Citi Emerging Markets Economic Surprise Index 38.7 +4.3 points

• 10-Year TIPS Spread 2.62 +2.0 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:

• 148 new infections/100K people(last 7 days total). 9.0%(+1.0 percentage point) of 1/14 peak +12/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -78.6%(+.4 percentage point) from peak 7-day avg. of 1/9/21 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -379 open in Japan 
• China A50 Futures: Indicating -90 open in China

• DAX Futures: Indicating -82 open in Germany

Portfolio:

• Higher: On gains in my industrial/commodity sector longs, index hedges and emerging  market shorts
  

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges, then covered some
  

• Market Exposure:  25% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Value -2.3%

Sector Underperformers:

• 1) Banks -6.2% 2) Airlines -5.1% 3) Gambling -4.4%

Stocks Falling on Unusual Volume: 

• PPG, OII, SJM, GVA, CPTN, GT, TDW, CDLX, SLCA, ICHR, SBCF, RJF, SIVB, GRPN, AXP, LEA, HWM, TREX, HBAN, IPGP, SGMS, LNC, UPST, SKX, EVRI, SKX, ZION, ARNC, LPLA, RCL, MP, RPAY, PARR, FOUR, SHEN, DXC, SPR, GDYN, PRIM, SUM, SUPN, OB, PNTG, ALBO, BIGC, ONTF, KD, AMLX, LCID, MBI, ZETA, PUBM, PACK, EHTH, NTLA, ATRA, AMBA and GDRX
  

Stocks With Unusual Put Option Activity:

• 1) KBE 2) SPHB 3) FEZ 4) IGT 5) RUSL
  

Stocks With Most Negative News Mentions:

• 1) VRM 2) ENDP 3) HRTX 4) VTRS 5) HAL
  

Charts:

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

Bull Radar

Style Outperformer:

• Mid-Cap Growth -.9%

Sector Outperformers:

• 1) Gold & Silver +3.8% 2) Homebuilding +.9% 3) Alt Energy +.1%

Stocks Rising on Unusual Volume:

• USER, OSH, SKYH, LPSN, TASK, FRPT, FNE, AXSM, SAIL, TGT, FORG, ACHC, CENX, ARIS, SRG, EPAM, CHRW, ZS, WDAY, OXY, EDIT, BAND, MNRL, AA, LAUR, BTU, LMT, CPE and SPGI
  

Stocks With Unusual Call Option Activity:

• 1) CTIC 2) IGT 3) QUAD 4) MULN 5) AMBA

Stocks With Most Positive News Mentions:

• 1) VRTV 2) TGT 3) ATGE 4) OXY 5) WDAY
  

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +32.9% Above 100-Day Average 
• 2 Sectors Rising, 9 Sectors Declining
• 43.1% of Issues Advancing, 53.6% Declining
• 89 New 52-Week Highs, 71 New Lows
• 40.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 46.3% 
• Bloomberg Global Risk-On/Risk-Off Index 2,398.0 -470.0 points
• Russell 1000: Growth/Value 16,576.0 +.39%
  
• Vix 31.8 +5.6%
• Total Put/Call .90 -3.2%
• TRIN/Arms 1.28 -2.3%