Monday Watch

Night Trading

• Asian indices are -.75% to +.25% on average.
• Asia Ex-Japan Investment Grade CDS Index 125.25 +2.0 basis points.
• China Sovereign CDS 71.25 -2.5 basis points.
• China Iron Ore Spot 131.7 USD/Metric Tonne +2.2%.
  
• Bloomberg Emerging Markets Currency Index 47.7 +.35%.
• Bloomberg Global Risk-On/Risk Off Index 53.3 -3.2%.
• Bloomberg US Financial Conditions Index -.54 -38.0 basis points. 
  
• Volatility Index(VIX) futures 23.2 -6.6%. 
• Euro Stoxx 50 futures +.4%.
• S&P 500 futures +1.69%.
• NASDAQ 100 futures +1.75%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly lower, weighed down by technology and consumer shares in the region. I expect US stocks to open higher and to weaken into the afternoon, finishing mixed.  The Portfolio is 50% net long heading into the week.

Tuesday Watch

Night Trading 

• Asian equity indices are -.25% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 110.0 -2.5 basis points. 

• China Sovereign CDS 64.75 +2.75 basis points. 
• China Iron Ore Spot 125.6 USD/Metric Tonne +1.0%.

• Bloomberg Emerging Markets Currency Index 47.8 +.01%.
• Bloomberg Global Risk-On/Risk Off Index  67.3 +.5%. 
• Bloomberg US Financial Conditions Index .25 -6.0 basis points.
  
• Volatility Index(VIX) futures 20.3 -.21%.
• Euro Stoxx 50 futures -.02%.

• S&P 500 futures +.10%.

• NASDAQ 100 futures +.15%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by consumer and industrial 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 Finish Slightly Higher on Loosening US Financial Conditions, Dollar Weakness, Technical Buying, Tech/Utility Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume:  Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 18.7 +1.2%
• DJIA Intraday % Swing .56%
  
• Bloomberg Global Risk On/Risk Off Index 66.8 -.1%

• Euro/Yen Carry Return Index 151.09 +.42%

• Emerging Markets Currency Volatility(VXY) 10.5 -.1%

• CBOE S&P 500 Implied Correlation Index 34.4 +1.3% 

• ISE Sentiment Index 96.0 +6.0 points
  

• Total Put/Call .97 +7.8%

• NYSE Arms 1.16 +58.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 70.5 -1.44%
  

• US Energy High-Yield OAS 330.3 -.95%
• Bloomberg TRACE # Distressed Bonds Traded 319.0 -4
  

• European Financial Sector CDS Index 82.9 -3.2% 
• Credit Suisse Subordinated 5Y Credit Default Swap 402.8 +2.5%
  

• Italian/German 10Y Yld Spread 183.0 basis basis points +1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 110.25 -1.25%
  

• Emerging Market CDS Index 226.05 -.19%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 27.5 +.7%

• 2-Year Swap Spread 32.0 basis points -1.5 basis points
  

• TED Spread 14.25 basis points -.5 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -8.75 -1.5 basis points
  
• MBS  5/10 Treasury Spread  149.0 +1.0 basis point
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 529.0 +2.0 basis points
  
• Avg. Auto ABS OAS 56.0 +1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.8 +.16%
• 3-Month T-Bill Yield 4.85% +1.0 basis point
  

• China Iron Ore Spot 124.3 USD/Metric Tonne unch.
• Dutch TTF Nat Gas(European benchmark) 42.1 euros/megawatt-hour -6.3%

• Citi US Economic Surprise Index 34.9 -4.0 points

• Citi Eurozone Economic Surprise Index 56.6 -7.8 points
  

• Citi Emerging Markets Economic Surprise Index 12.0 +2.6 points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 224.87 -.43:  Growth Rate +.9% -.2 percentage point, P/E 18.1 +.4
• S&P 500 Current Year Estimated Profit Margin 12.35% +2.0 basis points
  
• Bloomberg US Financial Conditions Index .30 +2.0 basis points
  
• Yield Curve -90.75 basis points (2s/10s) -.25 basis point
• US Atlanta Fed 1Q GDPNow Forecast +2.27% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.72% unch.: CPI YoY +6.21% unch.
  
• 10-Year TIPS Spread 2.49 -3.0 basis points
  
• Highest target rate probability for May 3rd FOMC meeting: 61.6%(-3.0 percentage points) chance of 5.0%-5.25%. Highest target rate probability for June 14th meeting: 56.1%(-.4 percentage point) chance of 5.25%-5.5%.
  

US Covid-19:

• 84 new infections/100K people(last 7 days total). 4.8%(-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 -83.3%(+.1 percentage point) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -227 open in Japan 
• China A50 Futures: Indicating -20 open in China

• DAX Futures: Indicating -5 open in Germany

Portfolio:

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

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges
  

• Market Exposure: Moved to 50% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Value -1.9%
  

Sector Underperformers:

• 1) Steel -2.5% 2) Digital Health -2.3% 3) Retail -2.2%

Stocks Falling on Unusual Volume: 

• SSL, BMBL, EGLE, AI, ITGR, STVN, FCF, ARHS, TRMD, CELH, OSPN, VICR, EBIX, IAA, GNK, BMRN, CECO, DXCM, CEIX, BPMC, SAVE, OMI and SRG
  

Stocks With Unusual Put Option Activity:

• 1) ARDX 2) ACWI 3) ACRS 4) SAVE 5) COST
  

Stocks With Most Negative News Mentions:

• 1) ACRS 2) UIS 3) BMRN 4) RIDE 5) VTNR
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.2%
  

Sector Outperformers:

• Airlines +1.7% 2) Software +.3% 3) Networking +.3%

Stocks Rising on Unusual Volume:

• BBIO, CDNA, VST, SYM, SNAP, KW, ACMR, VSAT, AUB, NEX, WMS, HGV, HTZ, RDN, ARMK, STWD, TPIC, CIEN, USFD, SSB, INTA, XPOF, PWSC and CHRD
  

Stocks With Unusual Call Option Activity:

• 1) ACWI 2) CLNE 3) ARDX 4) DKS 5) CIEN

Stocks With Most Positive News Mentions:

• 1) BBIO 2) CORT 3) GNS 4) KW 5) SNAP
  

Charts:

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

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open: 

• (DKS)/2.89
• (DOLE)/.05
• (SE)/-.55
• (THO)/1.10
  

After the Close:

• (CASY)/2.00
• (CRWD)/.43
• (SFIX)/-.33
  

Economic Releases 

10:00 am EST

• Wholesale Trade Sales MoM for Jan. is estimated to fall -.5% versus unch. in Dec.
  

3:00 pm EST

• Consumer Credit for Jan. is estimated to rise to $25.35B versus $11.57B in Dec.
  

Upcoming Splits

• (PCAR) 3-for-2
  

Other Potential Market Movers

• The Fed's Powell testimony to Senate, 3Y T-Note auction, China Trade Data report, weekly US retail sales reports, RBC Financial Institutions Conference, Truist Tech/Internet/Services Conference, UBS Tech Conference, (KEYS) investor day, (VC) investor day and the (INFN) investor day could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST