Tuesday Watch

Evening Headlines

Bloomberg:     

• EU Plans to Issue Detailed Guidance on Russia’s Rubles-for-Gas Demand.
• Ukraine Latest: Pentagon Sees Poor Russian Morale, Bad Logistics.  
• Fertilizer Buyers Are Eyeing Canada to Fill Global Potash Deficit.  
• Nutrien Boosts Outlook for Potash Sales as Fertilizer Surges.  
• EU Plans to Court Africa to Help Replace Russian Gas Imports.
  
• Japan Seen Unlikely to Intervene on Yen With Fed’s Jumbo Hike Looming.
  
• Korea’s Fastest Inflation Since 2008 Raises Rate Pressure.
  
• U.S. Futures Dip Ahead of Asia Open; Dollar Steady: Markets Wrap.
• Oil Holds Near $105 as Demand for Fuels Offsets China Lockdowns.
• Ken Griffin Says Fed Needs 4% Inflation This Year to Avoid Recession.
• PGIM’s Hunt Says Bond Market Shows U.S. Risks Recession by 2024.  
• Twitter Says Musk Deal Uncertainty Could Cost Staff, Advertisers.

 Wall Street Journal:

• 10-Year Treasury Yield Hits 3% for First Time Since 2018.
• Spirit Airlines Rejects JetBlue Takeover Bid.
• Amazon Workers Reject Union in New York After Labor Victory at Separate Facility.
• Latest Updates From the War.
• Facing a Wheat Crisis, Countries Race to Remake an Entire Market on the Fly.
• How Do Bubbles Form? Tulips and Gamestop Can Help Explain.

Fox News:     

• Elon Musk goes scorched-earth on NBC, runs through network's most notorious scandals.

CNBC.com:

• Fears of a Fed mistake grow as this week’s anticipated interest rate hike looms.
• ‘Bubble’ hitting 50% of market, top investor warns as Fed gets ready to meet.
• Australian markets set to fall ahead of closely watched interest rate decision.
• Home affordability is nearly the worst on record as mortgage rates spike.
• Stocks making the biggest moves after hours: Chegg, Clorox, Devon Energy and more.

 MarketWatch:              

• These stocks soared during the pandemic, and then crashed. 10 are now expected to double in price.  
• Recession is ‘almost inevitable’: former Fed Gov. Ferguson says.

Zero Hedge:

• "Never Let A Crisis Go To Waste" - Biden Official Says Fertilizer Shortage Will Spark Green Farming Transition.
• "All's Well That's Orwell" - Musk Tosses Tactical Nukes At 'Ministry Of Truth' And Trust-Fund Journo. 
• Wall Street Journal Claims "Shadow Crew" Of Billionaires Urged Elon Musk To Buy Twitter.
• Russian TV Warns Britain Can Be 'Drowned In Radioactive Tsunami’ By Single Nuclear Sub Strike.
• Venture-Backed Sale Of 'Virtual Land' Raises Millions In Buying Frenzy.
• Mayorkas Says DHS Preparing For Surge In Immigrants After Title 42 Ends, Warns "Do Not Come".
• Kim Jong Un Warns Of 'Preemptive Nuclear Strike' If North Korea Threatened.
• Sen. Scott: Left-Wing Groups Using Race, Lawsuits To Carry Out Election Fraud.
• Newsquawk Asia-Pac Market Open - Nasdaq led the late rebound and S&P 500 recovered from YTD lows.
• MyPillow CEO Mike Lindell Rejoins Twitter, Suspended Again Hours Later.
• Two Weeks To Flatten The GDP.
• Citadel's Griffin Warns 'West Faces Existential Problems'.
• Too much fear?
• Russia's Progress In Donbas "Minimal At Best" As 5,000 Javelins Have Entered Ukraine: Pentagon.
• Newsquawk US Market Wrap: Stocks rebound higher in late trade after earlier YTD SPX low was made in holiday-thinned market depth.
• May-Day Mayhem: Stocks Dump'n'Pump, Bonds Blowout, & Commodities Chaotic.

Newsmax:

• A Swing State No More? DeSantis Thinks Election May Flip Florida Red in a Big Way.
• Demand Way Up for High-End Nuclear Bunkers in Europe.
• Push to Arm Ukraine Putting Strain on US Weapons Stockpile.
• Warren Buffet: Wouldn't Buy 'All of the Bitcoin in the World' for $25.

TheGatewayPundit.com: 

• Russian State News TV Anchor Warns of Nuclear Missile Strikes on West (VIDEO).
• PRESIDENT TRUMP: “Every State Should Follow The Lead Of The Patriots In Arizona Where Yesterday Kari Lake and Mark Finchem Filed A Lawsuit To BAN ELECTRONIC VOTING MACHINES”.
• Auditor Geels: After Georgia Election Was Stolen – Secretary of State Raffensperger Still Refuses to Address Lawsuit on Irregularities of 2020 Election.
• ‘Will People on the Board Censor Information that is Not Helpful to Biden?’ – Peter Doocy Grills Psaki on Biden’s ‘Ministry of Truth’ (VIDEO).
• THIS WON’T END WELL FOR DEMOCRATS: Grand Jury Selected in Fulton County to Investigate Trump on JUNK CHARGES — The Day Before “2000 Mules” Movie Release Exposes PROVEN CONSPIRACY FRAUD in 2020 Georgia Election.
• Here We Go: NYC Raises Covid Alert Level to “Medium” Due to Rising China Virus Cases.
• BREAKING: Foreclosures Up 181% in One Year – Home Sales Down 12.6% vs. Last Year.
• Not Making Headlines… George Soros Dumps $750,000 into Wisconsin Midterms as Democrats Gear Up for the Steal.
• Dr. Birx Says US Must Prepare for Summer COVID Virus Surge Just Prior to 2022 Election.

The Epoch Times:

• Excessive Government Spending is Dragging Down the American Economy, Analysts Say.
• Republican Lawmakers Voice Concern Over Biden’s ‘Orwellian’ Disinformation Board.

Twitter: 

• @KLVeritas - We all need to be her voice, every single one of us…this cannot be allowed. This is the hill…Vanessa Martins Figueiredo was only 13 Years Old. 5 days After Pfizer, symptoms started. She didn't improve, she just got worse. She passed away on 1/10/2022, two months later. My daughter was healthy, she got vaccinated. My daughter got sick and died. It was the vaccine. Sudden rise of unvaccinated children with liver damage, were breastfed (by fully vaccinated mothers) | The Irish Sentinel.

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 807,241 Reports(+4,073 from prior week) Through April 15th, 2022.
  

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 +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 118.25 -.75 basis point. 

• China Sovereign CDS  79.0 unch.
  

• Bloomberg Emerging Markets Currency Index 52.13 +.01%. 
• Bloomberg Global Risk-On/Risk Off Index 4,131.0 +3.0 points.
• Volatility Index(VIX) futures 30.8 -.33%.
• Euro Stoxx 50 futures n/a.

• S&P 500 futures -.02%.

• NASDAQ 100 futures -.09%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AGCO)/1.91
• (BIIB)/4.36
• (BP)/.24
• (CNHI)/.24
• (CMI)/3.55
• (DISH)/.75
• (DD)/.67
• (ETN)/1.60
• (EL)/1.67
• (EXPD)/1.71
• (IT)/1.72
• (HLT)/.65
• (ITW)/2.07
• (INCY)/.69
• (ITT)/.97
• (LEA)/1.57
• (LPX)/4.57
• (MLM)/1.61
• (TAP)/.19
• (PFE)/1.57
• (ROK)/2.32
• (SMG)/4.80
• (SEE)/.93
• (VSH)/.58
• (WAT)/2.34
• (ZBH)/1.42
  

After the Close:

• (AMD)/.92
• (ABNB)/-.24
• (AKAM)/1.42
• (CZR)/-2.08
• (CRUS)/1.40
• (HRB)/3.81
• (LSCC)/.33
• (LYFT)/-.07
• (MTW)/.04
• (MTCH)/.49
• (MSTR)/-2.10
• (PRU)/2.68
• (RRR)/.62
• (SWKS)/2.63
• (SBUX)/.60
• (WERN)/.87
• (YUMC)/.33
  

Economic Releases

10:00 am EST

• Factory Orders for March is estimated to rise +1.2% versus a -.5% decline in Feb.
• Factory Orders Ex Transports for March.
• JOLTS Job Openings for March is estimated to fall to 11200K versus 11266K
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The German Unemployment Rate, Eurozone PPI report, weekly US retail sales reports and the Oppenheimer Industrial Growth Conference 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 industrial and metals shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 50% net long heading into the day.

Stocks Slightly Lower into Final Hour on US Policy-Induced Stagflation Fears, Fed "Behind the Curve" Worries, Earnings Outlook Concerns, REIT/Metals&Mining Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance:  Most Sectors Declining
  

• Volume:  Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 35.9 +7.5%
• Bloomberg Global Risk On/Risk Off Index 3,886.0 -59.0 points

• Euro/Yen Carry Return Index 140.54 -.18%

• Emerging Markets Currency Volatility(VXY) 12.3 +1.7%

• CBOE S&P 500 Implied Correlation Index 54.5 +6.1% 

• ISE Sentiment Index 90.0 +4.0 points
  

• Total Put/Call 1.3 -4.6%

• NYSE Arms .75 -63.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 85.1 +2.3%
  

• US Energy High-Yield OAS 381.59 +1.7%

• European Financial Sector CDS Index 101.6 -.6%

• Italian/German 10Y Yld Spread 189.0 +5.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 118.37 -.4%
  

• Emerging Market CDS Index 296.27 +4.0%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 29.27 -.06%
• Russia Sovereign Debt Credit Default Swap 3,717.66 +.3%
  

• 2-Year Swap Spread 32.75 -.75 basis point
  

• TED Spread 51.75 +5.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -21.75 unch.
  
• MBS  5/10 Treasury Spread  125.0 +2.0 basis points
  
• iShares CMBS ETF 48.29 -.84%
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 52.11 -.58%
• 3-Month T-Bill Yield .78% -5.0 basis points
  

• Yield Curve 27.0 (2s/10s) +8.75 basis points
  

• China Iron Ore Spot 145.0 USD/Metric Tonne -.33%

• Citi US Economic Surprise Index 28.0 -11.4 points

• Citi Eurozone Economic Surprise Index 40.2 -12.9 points
  

• Citi Emerging Markets Economic Surprise Index 42.7 -5.6 points

• 10-Year TIPS Spread 2.83 -15.0 basis points
  
• 0.0%(unch.) chance of no change at June 15th FOMC meeting, 0.0%(unch.) chance of no change at July 27th meeting

US Covid-19:

• 123 new infections/100K people(last 7 days total). 7.0%(unch.) of 1/14 peak +8/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -91.3%(-.3 percentage point) from peak 7-day avg. of 1/9/21 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -103 open in Japan 
• China A50 Futures: Indicating -254 open in China

• DAX Futures: Indicating -64 open in Germany

Portfolio:

• Higher: On gains in my tech/consumer discretionary sector longs, index hedges and emerging market shorts
  

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

• Market Exposure:  Moved to 50% Net Long
  

Monday Watch

Today's Headlines

Bloomberg:                       

• U.S. Homeland Chief Warns of Strain If Migration Spikes.
• China’s Lockdowns Wreak Havoc on Economy as Xi Pledges Support.   
• China Contagion Threatens to Derail the World’s Emerging Markets.
• Hungary Would Veto EU Sanctions on Russian Energy, Minister Says.
• Baerbock Says Sanctions Will Only Be Lifted After Russian Withdrawal.
  
• Ukraine Latest: Pelosi in Kyiv; Moscow Tightens Grip on Kherson.  
• Tourists, Rejoice! Italy, Greece Relax COVID-19 Restrictions.  
• Can the World Feed Itself? Historic Fertilizer Crunch Threatens Food Security.
  
• End of Easy Money Brings a $410 Billion Global Financial Shock.
• Sydney House Prices Slide Further in April as Rate Rise Looms.  
• Saudi Economy Grows at Fastest Pace in a Decade on Oil Boom.
• Stocks Face Challenging Open as Growth Fears Mount: Markets Wrap.
• These Media Stocks Have Fallen More than 50% This Year.
• Biggest Treasury Buyer Outside U.S. Quietly Offloads Billions.  
• Powell’s Fed Set to Go Big and Keep Going Until Inflation Tamed.
  

Wall Street Journal:

• Pelosi Pledges to Aid Ukraine Until Victory.
• Biden Establishes a Ministry of Truth. The Disinformation Governance Board already looks like a partisan instrument.
• China’s Economy Flirts With a Recession, Threatening to Drag Down Global Growth.
• Disney’s Clash With Florida Has CEOs on Alert.
• Fed Prepares Double-Barreled Tightening With Bond Runoff.
• Americans Feel Inflation Fatigue, and Some Companies See a Breaking Point.
• For Instacart Shoppers, the Job Is Getting Harder.
• Global Supply Chain Woes Reach America’s Amish Furniture Makers.

Fox News: 

• Chaos ensues after Antifa members show up to GOP rally, understaffed police struggle to respond.
• Germany reportedly makes significant turnaround in Russian oil stance.

CNBC:

• Surging prices force consumers to ask: Can I live without it?
• Warren Buffett says inflation ‘swindles almost everybody,’ Munger rails against bitcoin, market ‘mania’.
• The Fed’s favorite inflation gauge rose 5.2% in March as worker pay fell behind.
• Electric boats built by GM and former SpaceX engineers could be the next big thing – take a look.
• Top Wall Street analysts are getting bullish on these stocks for the long run.

Zero Hedge:

• Study Links Increase In Emergency Heart Events With COVID-19 Vaccine Rollout.
• New COVID Bill Fines Parents For Unvaxxed Kids And Doubles Income Taxes.
• Drawdown Delerium: Bezos Warns "Markets Teach, The Lessons Can Be Painful".
• Time Columnist Denounces Free Speech As A White Man's "Obsession".
• Alarming Signs Farmers Reduce Fertilizer May Wreck Crop Yields. 
• Newsquawk Asia-Pac Market Open - Weekend News Round Up.
• California Expands Medi-Cal To Adults 50 And Older, Regardless Of Immigration Status.
• Buyback Blackout Period Is Over, And 10 More Reasons Why Goldman Calls The End Of The Market Carnage.
• Biden Price Hike: Most Americans Blame US President For Higher Gas Prices.
• Diesel For Dinner.
• Crisis Or Hiccup? Assessing The Logistics Impact Of China Lockdowns.
• Biden Jokes About Low Approval Ratings At Correspondents' Dinner, Says "Some Guy Named Brandon" Is Having A Really Good Year.
• The Diesel Market Is Soaring, And Gasoline Prices Will Catch Up This Summer.
• Half Of France's Nuclear Reactors Are Shutdown Amid Energy Crisis.
• The People Behind DHS's Orwellian "Disinformation Governance Board".
• CDC Reports First Human Case Of Avian Influenza.
• Michigan Investigated Hundreds Of Doctors, Nurses Over COVID-Related Complaints.
• Shanghai Ship-Jam Spells Supply Chain Trouble.
• "Not The Right Fit" - Disney Exec Who Led Anti-Florida-Bill Response Leaves Firm After 3 Months.
• Tverberg: The World Has A Major Crude Oil Problem; Expect Conflict Ahead.

MarketWatch.com:        

• AMD’s earnings outlook expected to give a clearer picture of where the chip sector is headed.
  
• Why a fragile stock market faces danger from rising real yields as ‘TINA’ trade fades.

NewsMax:      

• McCaul Warns Next Weeks 'Pivotal' In Russia's War in Ukraine.  
• Study: Half of US Doesn't Trust FBI.

TheGatewayPundit.com:

• RINOs and Democrats Just Stole Future Elections in Deep Red Alaska — And the Republican Party DID NOT LIFT A FINGER to Stop It. 
• “You Can Never Think to the Future Until We Solve the Past, Because It Will Just Happen Again.” – President Trump on Those Who Want to Move On from 2020 Election. 
• Maskless Fauci Attends White House Correspondents’ Dinner Pre-Party with Masked Servants. 
• On April 21 Obama Said Social Media Censors “Don’t Go Far Enough” – 6 Days Later Puppet Joe Biden Rolls Out “Ministry of Truth”.
• “Never Let a Crisis Go to Waste” – Samantha Power Celebrates Fertilizer Shortages That will Force Farmers to Transition to “Natural Solutions” (VIDEO).
• TIME Magazine Correspondent Labels Freedom of Speech a “White Male Obsession”.
• MUST SEE: Catherine Englebrecht of True the Vote Gives a Riveting Interview on Steve Bannon’s War Room About the Massive Fraud in 2020 Election (VIDEO).
• Pfizer Announces Paxlovid is Not Effective at Preventing Covid-19 Infection Through a Household Contact — AFTER Biden Purchases 20 Million Doses.
• Palestinians Are Reportedly Destroying the Temple Mount Similar to What ISIS Did to the Arch de Triumph and Several Antiquities in Ancient Palmyra and Throughout the Region.
• Biden Laughs After Trevor Noah Roasts Him: “Since You’ve Come Into Office, Things Are Really Looking Up – Gas Is Up, Rent is Up, Food is Up!” (VIDEO).
• Joe Biden Attacks Republicans, Defends Disney at White House Correspondents’ Dinner as Liberal Reporters Laugh (VIDEO).
• Moderna Seeks Emergency Use Authorization For Covid Vaccine for Children Under the Age of 6.

The Epoch Times:

• Chinese Regime Locks Down World’s Largest Wholesale Hub Under its Zero-COVID Policy.

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 810,170 Reports(+2,929 from prior week) Through April 22nd, 2022.
  

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). 
• COVID Money Tracker. Tracking the Covid response.
  

Night Trading

• Asian indices are -.75% to +.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 119.0 -2.0 basis points.
• China Sovereign CDS 79.0 +1.5 basis points.
• Bloomberg Emerging Markets Currency Index 52.41 -.02%.
• Bloomberg Global Risk-On/Risk Off Index 3,979.0 +36.0 points.
• Volatility Index(VIX) futures 31.0 -.6%. 
• Euro Stoxx 50 futures n/a.
• S&P 500 futures +.21%.
• NASDAQ 100 futures +.38%.

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (AMG)/4.34
• (FSS)/.27
• (GPN)/2.04
• (ITRI)/.08
• (MCO)/2.89
• (ON)/1.05
• (SAIA)/2.72
  

After the Close:

• (ANET)/.81
• (CAR)/3.54
• (BXP)/1.74
• (EXPE)/-.43
• (FN)/1.52
• (MGM)/-.05
• (MOS)/2.42
• (NXPI)/3.19
• (RIG)/-.23
• (VNO)/.77
• (WMB)/.34
  

Economic Releases

10:00 am EST

• Construction Spending MoM for March is estimated to rise +.7% versus a +.5% gain in Feb.
• ISM Manufacturing for April is estimated to rise to 57.6 versus 57.1 in March.
• ISM Prices Paid for April is estimated to rise to 87.7 versus 87.1 in March.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone PMI report and the German Retail Sales report 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 commodity and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 25% net long heading into the week.