Bull Radar

Style Outperformer:

• Small-Cap Growth +2.6%

Sector Outperformers:

• 1) Gold & Silver +5.3% 2) Homebuilders +4.2% 3) Oil Service +3.8%

Stocks Rising on Unusual Volume:

• BIIB, QTRX, DNLI, RDNT, BTU, OPCH, LLY, FYBR, ILMN, CWH, HAIN, HLIT, ALKT, IVR, BECN, KMX and AMPS
  

Stocks With Unusual Call Option Activity:

• 1) CTIC 2) BIIB 3) IGT 4) KMX 5) OCGN

Stocks With Most Positive News Mentions:

• 1) LLY 2) BIIB 3) PRTA 4) ABOS 5) BIAF
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +2.2% Above 100-Day Average 
• 1 Sector Declining, 10 Sectors Rising
• 82.6% of Issues Advancing, 13.4% Declining
• 8 New 52-Week Highs, 222 New Lows
• 17.4%(+10.4%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 30.0 +6.0
  
• Bloomberg Global Risk-On/Risk-Off Index 46.4 -5.7%
  
• Russell 1000: Growth/Value 15,621.0 -.77%
  
• Vix 31.9 -2.3%
• Total Put/Call 1.10 -2.7%
• TRIN/Arms .93 +12.0% 

Wednesday Watch

Night Trading 

• Asian equity indices are -.5% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 169.0 -10.0 basis points. 

• China Sovereign CDS 104.75 -5.25 basis points.
  

• Bloomberg Emerging Markets Currency Index 47.14 unch.  
• Bloomberg Global Risk-On/Risk Off Index 49.22 +.04%. 
• Bloomberg US Financial Conditions Index -1.16 -6.0 basis points
  
• Volatility Index(VIX) futures 31.0 -1.1%
• Euro Stoxx 50 futures n/a.

• S&P 500 futures +.26%.

• NASDAQ 100 futures +.34%  

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (CTAS)/3.14
• (PAYX)/.97
• (THO)/3.85
  

After the Close:

• (JEF)/.73
• (MTN)/-2.88
  

Economic Releases

8:30 am EST

• Advance Goods Trade Balance for Aug. is estimated at -$89.0B versus -$89.1B in Sept.
• Wholesale Inventories MoM for Aug. is estimated to rise +.4% versus a +.6% gain in July.
• Retail Inventories MoM for Aug. is estimated to rise +1.0% versus a +1.1% gain in July.
  

10:00 am EST

• Pending Home Sales MoM for Aug. is estimated to fall -1.5% versus a -1.0% decline in July. 
• Pending Home Sales YoY for Aug. is estimated to fall -24.5% versus a -22.5% decline in July.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +1,206,710 barrels versus a +1,141,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +323,140 barrels versus a +1,570,000 barrel gain the prior week. Distillate inventories are estimated to rise by +212,000 barrels versus a +1,230,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.77% versus a +2.1% gain prior.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Powell speaking, Fed's Bowman speaking, Fed's Bullard speaking, German GFK Confidence report, 7Y T-Note auction, weekly MBA Mortgage Applications report and the (MDRX) investor day could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are modestly lower, weighed down by technology and consumer shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed. The Portfolio is 25% Net Long heading into the day.

Stocks Reversing Lower into Afternoon on US Policy-Induced Stagflation Fears, Escalating European Energy/Currency Crisis Worries, Rising European/Emerging Markets/US High-Yield Debt Angst, Financial/Utility Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume:  Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 33.5 +3.8%
• DJIA Intraday % Swing 2.4%
  
• Bloomberg Global Risk On/Risk Off Index 48.4 +5.0%

• Euro/Yen Carry Return Index 143.0 -.2%

• Emerging Markets Currency Volatility(VXY) 12.1 -.08%

• CBOE S&P 500 Implied Correlation Index 52.6 +.7% 

• ISE Sentiment Index 98.0 +3.0 points
  

• Total Put/Call 1.07 +13.8%

• NYSE Arms .95 -28.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 111.43 +2.0%
  

• US Energy High-Yield OAS 430.45 +2.4%
• Bloomberg TRACE # Distressed Bonds Traded 396.0 +3.0
  

• European Financial Sector CDS Index 151.61 +2.6%
  

• Italian/German 10Y Yld Spread 253.0 basis points +8.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 170.50 +3.4%
  

• Emerging Market CDS Index 335.30 +2.0%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.09 -.99%

• 2-Year Swap Spread 27.0 basis points -8.25 basis points
  

• TED Spread 34.5 basis points -10.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -23.5 basis points +4.0 basis points
  
• MBS  5/10 Treasury Spread  173.0 -6.0 basis points
  
• iShares CMBS ETF 45.72 -.37%
• Avg. Auto ABS OAS .61 -1.0 basis  point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.1 -.14%
• 3-Month T-Bill Yield 3.29% +5.0 basis points
  

• Yield Curve -34.75 basis points (2s/10s) +9.25 basis points
  

• China Iron Ore Spot 97.2 USD/Metric Tonne +.3%
• Dutch TTF Nat Gas(European benchmark) 208.0 euros/megawatt-hour +19.7%

• Citi US Economic Surprise Index 14.9 +4.0 points

• Citi Eurozone Economic Surprise Index -.9 +3.7 points
  

• Citi Emerging Markets Economic Surprise Index -2.4 -1.7 points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 236.26 +.03:  Growth Rate +15.9% +.1 percentage point, P/E 15.4 -.1
  
• Bloomberg US Financial Conditions Index -1.11 -1.0 basis point
  
• US Atlanta Fed GDPNow Forecast +.27% -4.0 basis points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.68% unch.: CPI YoY +8.20% +1.0 basis point
  
• 10-Year TIPS Spread 2.33 -1.0 basis point
  
• Highest target rate probability for December 14th FOMC meeting: 59.2%(-10.0 percentage points) chance of 4.25%-4.5%. Highest target rate probability for February 1st meeting: 57.1%(-11.2 percentage points) chance of 4.5%-4.75%.
  

US Covid-19:

• 112 new infections/100K people(last 7 days total). 6.4%(-0.0 percentage point) of 1/14/22 peak(1,740) -0/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -82.6%(+.8 percentage point) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -481 open in Japan 
• China A50 Futures: Indicating -78 open in China

• DAX Futures: Indicating -60 open in Germany

Portfolio:

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

• Disclosed Trades:  Added to my emerging market shorts
  

• Market Exposure:  Moved to Market Neutral
  

Bear Radar

Style Underperformer:

• Large-Cap Value -.8%
  

Sector Underperformers:

• 1) Utilities -2.0% 2) Banks -1.9% 3) Restaurants -1.6%

Stocks Falling on Unusual Volume: 

• HCSG, AAWW, RUM, KDP, IBOC, LTH, PM, EPC, TMX, STT, VRE, LESL, MATV, BNL, NLY, AHH, AVNT, XMTR, DYN, PFS, FAZE and RNA
  

Stocks With Unusual Put Option Activity:

• 1) LQD 2) SAVE 3) ADT 4) EWC 5) IBB
  

Stocks With Most Negative News Mentions:

• 1) ORCL 2) PTON 3) NIO 4) MNSO 5) MSC
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +.2%

Sector Outperformers:

• 1) Shipping +1.6% 2) Energy +1.1% 3) Oil Service +1.1%

Stocks Rising on Unusual Volume:

• SKIN, AMPS and NVAX
  

Stocks With Unusual Call Option Activity:

• 1) HRL 2) RITM 3) ETRN 4) ARLP 5) GNRC

Stocks With Most Positive News Mentions:

• 1) NMTR 2) SKIN 3) EQ 4) DCPH 5) PRFT
  

Charts:

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