Bull Radar

Style Outperformer:

• Small-Cap Value -.4%

Sector Outperformers:

• 1) Oil Service +2.3% 2) Steel +1.5% 3) Gold & Silver +1.3%

Stocks Rising on Unusual Volume:

• LRN, MNRO, COF, T, NWSA, LBRT, SUMO, SMR, PACB and OGS
  

Stocks With Unusual Call Option Activity:

• 1) CSX 2) PBF 3) CNC 4) RYAM 5) GD

Stocks With Most Positive News Mentions:

• 1) SNOA 2) LRN 3) RES 4) SYBT 5) INPX
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -11.8% Below 100-Day Average 
• 11 Sectors Declining, 0 Sectors Rising
• 32.9% of Issues Advancing, 63.3% Declining
• 33 New 52-Week Highs, 8 New Lows
• 52.8%(-2.0%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 58.0 -2.0
  
• Bloomberg Global Risk-On/Risk-Off Index 55.8 -1.1%
  
• Russell 1000: Growth/Value 14,370.9 -.55%
  
• Vix 19.9 +3.8%
• Total Put/Call 1.01 -.98%
• TRIN/Arms .81 -43.1%
  

Wednesday Watch

Evening Headlines

Bloomberg:          

• Stagflation Is the Dreaded Word No One Dared Speak at Davos. 
• Australia’s Accelerating Inflation Boosts RBA Rate-Hike Bets.
• BOJ Owns More Than 100% of Some Debt as Bonds Go Round and Round.  
• US and Germany Set to Send Tanks to Ukraine, Breaking Deadlock.
• Asian Stocks Stumble, Tech Damps US Equity Futures: Markets Wrap.  
• Oil Steadies as Traders Look to China, OPEC for Fresh Triggers.
• DOJ’s Google Case Adds to the Mounting Scrutiny of Big Tech.  
• Google Has Destroyed Its Competition: AG Garland.
• Bitcoin Eyes First Two-Day Drop of 2023 as Microsoft Dents Mood.
• ‘Scared the Hell Out of Me’: NYSE’s Wild Start Rattles Traders.
• Jeremy Grantham Warns of a 17% Plunge in the S&P 500 This Year.  
• Microsoft Erases Gains After Saying Azure Growth to Decelerate.  
• US Secrets Land in All the Wrong Places as Presidents Ignore Honor System.  
• Bond Traders Hedge Prospect That This May Be Fed’s Last Hike.
• ‘Show Us Your Plan’: Democrats Push GOP to Deliver Debt Proposal.

Wall Street Journal:

• Walmart to Raise Wages for U.S. Hourly Workers.
• Zelensky Removes Top Officials in Bid to Contain Corruption Scandals.
• Rupert Murdoch Scraps Proposal to Merge Fox and News Corp.
• Dozens of NYSE Stocks Halted in Opening Minutes.
• FDA Proposes Limits for Lead in Baby Food.
• Biden, Schumer, Jeffries Look to Project Unity Ahead of Spending Fights.

Fox News:

• FIRST ON FOX:Biden admin slapped with lawsuit from 20 states over controversial policy.

CNBC.com:

• Microsoft offers lackluster guidance, says new business growth slowed in December.
• BlockFi secret financials show a $1.2 billion relationship with FTX and Alameda.
• DOJ files second antitrust suit against Google, aims to break up ad business.
• JPMorgan’s Marko Kolanovic: I’m ‘outright negative’ on stocks.
• NYSE’s Tuesday trading glitch explained.
• Stocks making the biggest moves after hours: Microsoft, Texas Instruments, Capital One & more.

MarketWatch:              

• ‘The Nasdaq is our favorite short.’ This market strategist sees recession and a credit crunch slamming stocks in 2023.
• Jeremy Grantham says ‘easiest leg’ of stock-market bubble burst is over. Here’s what’s next.  
• Spotify joins Google, Intel, Microsoft, Amazon, Salesforce and other major companies laying off thousands of people.

Zero Hedge:

• Ukraine Rocked By Corruption Scandal, Wave Of Top Officials Resign: Sports Cars, Mansions & Luxury Vacations As People Suffered.
• DOJ Signals To Rep. Jim Jordan It Won't Hand Over Docs Related To Pending Investigations.
• Tesla To Announce New $3.5 Billion Production Facility For Semis In Nevada.
• Biden Says He Won't Let GOP 'Wreck' Economy While McConnell Says McCarthy Needs To Craft Debt Ceiling Deal.
• Mattress Giant Serta Simmons Files For Second Bankruptcy In Two Years.
• Microsoft Reverses Gains After CFO Slashes Outlook.
• Flood-Damaged Cars From California Likely To Hit Used Market Soon.
• Controversy Swirls Over George Santos Campaign Finance Questions.
• Battle Tanks For Ukraine Approved On Same Day Doomsday Clock Hits Closest Point To Midnight In History.
• Wuhan Collaborator EcoHealth Alliance Gets Fresh $3 Million Grant From DoD.
• US stocks were rangebound amid mixed data and geopolitical concerns - Newsquawk Asia-Pac Market Open.
• Welcome To Hotel California: Lawmakers Move To Tax People Who Have Left The State.
• WTI Holds Losses After API Reports Biggest Cushing Build Since April 2020.
• Dollar & Bonds choppy on mixed data and Geopolitical tensions - Newsquawk US Market Wrap.
• Life after the brutal squeeze.
• Fox News Weatherman 'Beaten By Group Of Teens' On NYC Subway Train.
• Short-Squeeze Stalls Amid Equity Market Mayhem; Bonds & Bullion Bid.

Newsmax:

• DirecTV Could Drop NEWSMAX Tonight, House GOP Furious Over 'Deplatforming'.
• Rep. Weber: Biden's Actions Left Oil Reserves 'Perilously Low'.
• VP Harris Omits Right to 'Life' When Referencing Declaration of Independence.

TheGatewayPundit.com:

• HERE IT IS – THE SMOKING GUN: The 20 Point Email of Classified Information from His Father that Hunter Biden Sent to Burisma Board Member in April 2014.
• Arizona’s Katie Hobbs Halts Executions of Over 100 Murderers – Here’s Who She’s Sparing.
• Las Vegas Judge Commits Suicide After Facing Ethics Probe For Demanding An Investigation Into Alleged Sex Trafficking Ring.
• Whoa! Pfizer’s Latest Ad with Martha Stewart Claims the COVID Booster Shot will Take Out the COVID Virus – A COMPLETE LIE.
• “Kick In The Face” – Soldiers Fired For Refusing COVID Vaccine Forced To Pay Back Signing Bonuses.
• Here We Go: FDA is Pushing for Annual Covid Shots for Americans.
• EU Official Threatens Elon Musk for Allowing Free Speech on Twitter.
• BREAKING: Former Vice President Mike Pence Finds Classified Documents in His Indiana Home – Discovered Last Week.
• Bill Gates Predicts Another Pandemic Which Could be Man-Made and Worse than COVID-19.
• Breaking: Joe Biden Considers Sending “Significant Number” of Abrams M1 Tanks to Ukraine – DESPITE RUSSIAN THREATS OF NUCLEAR WAR.

The Epoch Times:

• Beijing’s Loose Monetary Policy Fails to Boost China’s Economy.

Twitter: 

• @libsoftiktok - “Innocent family-friendly entertainment”. (pic)
  
• @AlertChannel - Why doesn't India have mRNA vaccinations? Why did Pfizer and Moderna miss out on the most lucrative market? 2 reasons:  India insists on vaccination damage liability and own studies before mass vaccination of its population.. (video)
  

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 922,020 Reports(+3,512 from prior week) Through January 6th, 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 -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 106.50 -.5 basis point. 

• China Sovereign CDS 52.25 unch. 
• China Iron Ore Spot 124.3 USD/Metric Tonne -1.1%.

• Bloomberg Emerging Markets Currency Index 48.7 +.03%.
• Bloomberg Global Risk-On/Risk Off Index  56.4 +.09%. 
• Bloomberg US Financial Conditions Index .27 +1.0 basis point.
  
• Volatility Index(VIX) futures 20.2 +1.3%.
• Euro Stoxx 50 futures -.29%.

• S&P 500 futures -.45%.

• NASDAQ 100 futures -.79%.  

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (ABT)/.93
• (ASML)/4.33
• (T)/.58
• (ADP)/1.94
• (BA)/.20
• (FCX)/.44
• (GD)/3.54
• (GPI)/10.73
• (HTLD)/.30
• (HES)/1.63
• (KMB)/1.51
• (NDAQ)/.65
• (MNRO)/.43
• (NEE)/.50
• (NSC)/3.44
• (PGR)/1.45
• (TDY)/4.54
• (TXT)/1.07
• (USB)/1.14
  

After the Close:

• (BOOT)/1.75
• (CCI)/1.94
• (CSX)/.47
• (ETD)/.89
• (FLEX)/.60
• (IBM)/3.61
• (LRCX)/10.00
• (LVS)/-.10
• (LEVI)/.30
• (RJF)/2.28
• (STX)/.09
• (NOW)/2.02
• (STLD)/3.64
• (TER)/.75
• (TSLA)/1.12
• (URI)/10.29
  

Economic Releases

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +704,000 barrels versus a +8,408,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +1,304,430 barrels versus a +3,483,000 barrel gain prior. Distillate inventories are estimated to fall by -1,232,140 barrels versus a -1,939,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise +1.64% versus a +1.2% gain prior.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Australia CPI report, 5Y T-Note auction, weekly MBA Mortgage Applications report, (KMI) investor day, (PLUG) business update and the TD Securities Mining Conference could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and mining shares in the region. I expect US stocks to open modestly lower and to maintain losses into the afternoon.  The Portfolio is 50% net long heading into the day.

Stocks Slightly Higher into Final Hour on US Economic Soft Landing Hopes, Earnings Outlook Optimism, Technical Buying, Metals & Mining/Homebuilder Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume:  Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 19.2 -3.3%
• DJIA Intraday % Swing 1.33%
  
• Bloomberg Global Risk On/Risk Off Index 56.4 -.6%

• Euro/Yen Carry Return Index 146.7 -.4%

• Emerging Markets Currency Volatility(VXY) 10.4 -.6%

• CBOE S&P 500 Implied Correlation Index 36.3 -3.9% 

• ISE Sentiment Index 96.0 +8.0 points
  

• Total Put/Call 1.02 +13.3%

• NYSE Arms 1.59 +65.6%

Credit Investor Angst:

• North American Investment Grade CDS Index 71.9 -.56%
  

• US Energy High-Yield OAS 361.56 +1.3%
• Bloomberg TRACE # Distressed Bonds Traded 310.0 -8.0
  

• European Financial Sector CDS Index 88.16 +.39% 
• Credit Suisse Subordinated 5Y Credit Default Swap 363.18 -3.5%
  

• Italian/German 10Y Yld Spread 176.0 basis points -6.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 106.9 +.29%
  

• Emerging Market CDS Index 227.82 -.11%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 27.95 -.37%

• 2-Year Swap Spread 24.75 basis points +.75 basis point
  

• TED Spread 15.5 basis points -3.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -13.75 -.25 basis point
  
• MBS  5/10 Treasury Spread  136.0 -2.0 basis points
  
• Bloomberg US Agg CMBS Avg OAS 108.0 unch.
  
• Avg. Auto ABS OAS .72 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 48.6 +.22%
• 3-Month T-Bill Yield 4.66% +1.0 basis point
  

• China Iron Ore Spot 123.9 USD/Metric Tonne -1.4%
• Dutch TTF Nat Gas(European benchmark) 58.27 euros/megawatt-hour -11.7%

• Citi US Economic Surprise Index -15.2 +2.5 points

• Citi Eurozone Economic Surprise Index 89.8 +5.2 points
  

• Citi Emerging Markets Economic Surprise Index 3.5 -.5 point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 228.22 -.06:  Growth Rate +10.6% -.1 percentage point, P/E 17.6 unch.
  
• Bloomberg US Financial Conditions Index .25 -1.0 basis point
  
• Yield Curve -74.75 basis points (2s/10s) -3.0 basis points
• US Atlanta Fed GDPNow Forecast +3.53% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.45% unch.: CPI YoY +6.39% +5.0 basis points
  
• 10-Year TIPS Spread 2.28 unch.
  
• Highest target rate probability for March 22nd FOMC meeting: 84.3%(-3.2 percentage points) chance of 4.75%-5.0%. Highest target rate probability for May 3rd meeting: 56.4%(-.3 percentage point) chance of 4.75%-5.0%.
  

US Covid-19:

• 105 new infections/100K people(last 7 days total). 7.2%(-.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 -79.9%(+1.1 percentage points) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -54 open in Japan 
• China A50 Futures: Indicating +225 open in China

• DAX Futures: Indicating +73 open in Germany

Portfolio:

• Slightly Lower:  On losses in my medical sector longs and emerging market shorts
  

• Disclosed Trades:  None
  

• Market Exposure: 50% Net Long
  

Bear Radar

 Style Underperformer:

• Mid-Cap Growth -.5%
  

Sector Underperformers:

• 1) Road & Rail -1.3% 2) Pharma -1.1% 3) Retail -.7%

Stocks Falling on Unusual Volume: 

• ADNT, DHR, AMD, CTLT, AM, OCSL, SFNC, BRO, TMO, AFRM, TENB, TRMD, RGEN, ENPH, MMM, PD, NINE, W, AMN, INVA, FLNC, DIN, ONB, MGA, CAKE, PFLT, HOLO and SAVA
  

Stocks With Unusual Put Option Activity:

• 1) RITM 2) BSX 3) KBH 4) DLR 5) CSX
  

Stocks With Most Negative News Mentions:

• 1) LGMK 2) FOR 3) AMD 4) MMM 5) LULU
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value -.1%

Sector Outperformers:

• 1) Airlines +.5% 2) Education +.5% 3) Gambling +.5%

Stocks Rising on Unusual Volume:

• RETA, CPRX, PTGX, PLRX, SUMO, PCAR, CRDO, XMTR, HPK, MIRM and CR
  

Stocks With Unusual Call Option Activity:

• 1) DUST 2) SPB 3) BSX 4) NWL 5) CPB

Stocks With Most Positive News Mentions:

• 1) COSM 2) BBCP 3) AXLA 4) PCAR 5) AUB
  

Charts:

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