BETWEEN THE HEDGES

Thursday, May 26, 2022

Morning Market Internals

Posted by Gary .....at 10:35 AM

NYSE Composite Index:

Volume Running +.2% Above 100-Day Average
0 Sectors Declining, 11 Sectors Rising
86.0% of Issues Advancing, 11.2% Declining
64 New 52-Week Highs, 20 New Lows
26.2% of Issues Above 200-day Moving Average
Average 14-Day RSI 41.5%
Bloomberg Global Risk-On/Risk-Off Index 3,997.0 +119.0 points
Russell 1000: Growth/Value 14,555.0 +.36%
Vix 27.6 -2.8%
Total Put/Call .90 +1.1%
TRIN/Arms .68 -9.2%

Wednesday, May 25, 2022

Thursday Watch

Posted by Gary .....at 8:45 PM

Night Trading

Asian equity indices are +.25% to +.75% on average.

Asia Ex-Japan Investment Grade CDS Index 120.25 -7.5 basis points.

China Sovereign CDS 73.75 -6.75 basis points.

Bloomberg Emerging Markets Currency Index 52.16 +.13%.
Bloomberg Global Risk-On/Risk Off Index 3,894.0 +17.0 points.
Volatility Index(VIX) futures 28.3 -.8%.
Euro Stoxx 50 futures +.35%.

S&P 500 futures +.15%.

NASDAQ 100 futures +.07%.

Morning Preview Links

Earnings of Note
Company/Estimate

Before the Open:

(BABA)/7.17
(AMWD)/1.34
(BIDU)/5.58
(BURL)/.63
(DG)/2.32
(DLTR)/1.98
(JACK)/1.37
(M)/.83
(MDT)/1.56
(SAFM)/7.42
(TITN)/.53
(TD)/1.93

After the Close:

(AEO)/.25
(ADSK)/1.34
(COST)/3.02
(DELL)/1.39
(GPS)/-.13
(MRVL)/.51
(OLLI)/.31
(RRGB)/-.73
(ULTA)/4.49
(VMW)/1.56
(WDAY)/.85
(ZS)/.11

Economic Releases

8:30 am EST

Initial Jobless Claims for last week are estimated to fall to 215K versus 218K the prior week.
Continuing Claims are estimated to fall to 1310K versus 1317K prior.

10:00 am EST

Pending Home Sales MoM for April is estimated to fall -2.0% versus a -1.2% decline in March.

11:00 am EST

The Kansas City Fed Manufacturing Activity Index for May is estimated to fall to 18.0 versus 25.0 in April.

Upcoming Splits

None of note

Other Potential Market Movers

The Japan CPI report, 7Y T-Note auction, weekly EIA natural gas inventory report and the (DE) analyst day could also impact global trading today.

US Equity Market Hours

9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are modestly higher, boosted by consumer 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 Higher into Final Hour on Stable Long-Term Rates, Technical Buying, Short-Covering, Consumer Discretionary/Tech Sector Strength

Posted by Gary .....at 3:43 PM

Broad Equity Market Tone:

Advance/Decline Line: Substantially Higher

Sector Performance: Almost Every Sector Rising

Volume: Around Average

Market Leading Stocks: Outperforming

Equity Investor Angst:

Volatility(VIX) 28.5 -3.3%
Bloomberg Global Risk On/Risk Off Index 3,859.0 +168.0 points

Euro/Yen Carry Return Index 140.05 -.06%

Emerging Markets Currency Volatility(VXY) 12.3 +.5%

CBOE S&P 500 Implied Correlation Index 47.0 -1.5%

ISE Sentiment Index 115.0 -2.0 points

Total Put/Call .87 -13.0%

NYSE Arms .72 -48.2%

Credit Investor Angst:

North American Investment Grade CDS Index 82.73 -5.1%

US Energy High-Yield OAS 428.77 -3.8%

European Financial Sector CDS Index 104.76 -2.9%

Italian/German 10Y Yld Spread 200.0 basis points -1.0 basis point

Asia Ex-Japan Investment Grade CDS Index 123.57 -3.4%

Emerging Market CDS Index 274.90 -4.9%

China Corp. High-Yield Bond USD ETF(KHYB) 28.9 -.28%
Russia Sovereign Debt Credit Default Swap 12,780.40 +26.8%

2-Year Swap Spread 28.5 basis points -2.5 basis points

TED Spread 47.75 basis points +1.5 basis points

3-Month EUR/USD Cross-Currency Basis Swap -18.25 basis points +.5 basis point
MBS 5/10 Treasury Spread 118.0 -2.0 basis points
iShares CMBS ETF 48.83 +.58%

Economic Gauges:

Bloomberg Emerging Markets Currency Index 52.14 -.91%
3-Month T-Bill Yield 1.05% unch.

Yield Curve 24.25 basis points (2s/10s) -3.0 basis points

China Iron Ore Spot 130.4 USD/Metric Tonne -.1%

Citi US Economic Surprise Index -39.6 -2.3 points

Citi Eurozone Economic Surprise Index 8.1 -2.0 points

Citi Emerging Markets Economic Surprise Index 12.1 +.3 point

10-Year TIPS Spread 2.58 unch.
0.0%(unch.) chance of no change at July 27th FOMC meeting, 0.0%(unch.) chance of no change at September 21st meeting

US Covid-19:

217 new infections/100K people(last 7 days total). 13.0%(unch.) of 1/14 peak -1/100K people from prior report.
New Covid-19 patient hospital admissions per 100K population -83.3%(+1.7 points) from peak 7-day avg. of 1/9/21 - 1/15/22

Overseas Futures:

Nikkei 225 Futures: Indicating +183 open in Japan
China A50 Futures: Indicating -7 open in China

DAX Futures: Indicating +64 open in Germany

Portfolio:

Higher: On gains in my tech/commodity/industrial sector longs

Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges, then added them back

Market Exposure: 50% Net Long

Bear Radar

Posted by Gary .....at 2:50 PM

Style Underperformer:

Large-Cap Value +.4%

Sector Underperformers:

1) Gold & Silver -.9% 2) Medical Equipment -.2% 3) Utilities -.2%

Stocks Falling on Unusual Volume:

A, SLGN, HOLX, COOP, DXCM, LTHM, RVNC, SWTX, TMDX, ASGN, CRNX, PMVP, KDNY and ARQT

Stocks With Unusual Put Option Activity:

1) DKS 2) CCL 3) TOL 4) URBN 5) INTU

Stocks With Most Negative News Mentions:

1) TWOU 2) VRCA 3) ASGN 4) GRIN 5) NTRA

Charts:

Bull Radar

Posted by Gary .....at 1:48 PM

Style Outperformer:

Mid-Cap Growth +1.1%

Sector Outperformers:

1) Retail +5.9% 2) Homebuilding +4.1% 3) Gambling +2.5%

Stocks Rising on Unusual Volume:

CAL, HIBB, ANF, MAXR, KSS, DY, CVNA, PLAB, URBN, JWN, VVV, SNAP, WSM, DKS, RAMP, WEN, ASO, VSTO, M, GCO, INTU, SWBI, CLAR, AMPH, TOL, ZM, BBY, CARG, FRG, AVD, LRN, CUTR, CVET, HGTY, NZF and VMW

Stocks With Unusual Call Option Activity:

1) VOO 2) DKS 3) TOL 4) FL 5) ICE

Stocks With Most Positive News Mentions:

1) WINR 2) CAL 3) PLAB 4) VV 5) JWN