Thursday, May 04, 2023

Friday Watch

Evening Headlines

Bloomberg: 

Zero Hedge:
Wall Street Journal:
Newsmax: 
TheGatewayPundit.com:
The Epoch Times:
Twitter: 
OpenVAERS:
SKirsch.com:
Night Trading 
  • Asian equity indices are -.5% to unch. on average.
  • Asia Ex-Japan Investment Grade CDS Index 136.5 +1.75 basis points. 
  • China Sovereign CDS 78.0 +1.5 basis points.
  • China Iron Ore Spot 96.50 USD/Metric Tonne -2.96%.
  • Bloomberg Emerging Markets Currency Index 47.8 +.01%.
  • Bloomberg Global Risk-On/Risk Off Index 50.1 -.05%. 
  • Bloomberg US Financial Conditions Index -.21 -1.0 basis point.
  • Volatility Index(VIX) futures 22.7 -.96%.
  • Euro Stoxx 50 futures +.23%.
  • S&P 500 futures +.29%.
  • NASDAQ 100 futures +.38%.  
Morning Preview Links

BOTTOM LINE: Asian indices are modestly lower, weighed down by consumer and financial 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 Lower into Final Hour on Regional Bank Contagion Fears, US Policy-Induced Stagflation Concerns, Earnings Outlook Worries, Financial/Airlines Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Lower
  • Sector Performance: Most Sectors Declining
  • Volume: Above Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 20.2 +9.9%
  • DJIA Intraday % Swing 1.26%
  • Bloomberg Global Risk On/Risk Off Index 49.9 -4.0%
  • Euro/Yen Carry Return Index 154.5 -.90%
  • Emerging Markets Currency Volatility(VXY) 9.9 -.1%
  • CBOE S&P 500 Implied Correlation Index 38.3 +8.1% 
  • ISE Sentiment Index 81.0 -18.0 points
  • Total Put/Call .82 -24.8%
  • NYSE Arms .85 -34.6%
Credit Investor Angst:
  • North American Investment Grade CDS Index 83.6 +2.5%
  • US Energy High-Yield OAS 433.73 +3.4%
  • Bloomberg TRACE # Distressed Bonds Traded 413.0 unch.
  • European Financial Sector CDS Index 106.8 +3.6% 
  • Deutsche Bank Subordinated 5Y Credit Default Swap 385.25 +2.8%
  • Italian/German 10Y Yld Spread 193.0 basis points +6.0 basis points
  • Asia Ex-Japan Investment Grade CDS Index 135.5 +1.9%
  • Emerging Market CDS Index 250.92 +2.9%
  • China Corp. High-Yield Bond USD ETF(KHYB) 26.62 -.01%
  • 2-Year Swap Spread 26.25 basis points -3.25 basis points
  • TED Spread 6.5 basis points -8.0 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -25.5 -2.5 basis points
  • MBS  5/10 Treasury Spread 164.0 +1.0 basis point
  • Bloomberg CMBS Investment Grade Bbb Average OAS 708.0 +6.0 basis points
  • Avg. Auto ABS OAS 94.0 +1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 47.8 +.05%
  • 3-Month T-Bill Yield 5.21% +1.0 basis point
  • China Iron Ore Spot 96.4 USD/Metric Tonne -3.1%
  • Dutch TTF Nat Gas(European benchmark) 35.6 euros/megawatt-hour -3.1%
  • Citi US Economic Surprise Index 15.9 -.7 point
  • Citi Eurozone Economic Surprise Index 5.30 -7.3 points
  • Citi Emerging Markets Economic Surprise Index 36.6 +1.5 points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 227.5 +.00:  Growth Rate +2.0% -.1 percentage point, P/E 17.8 -.3
  • S&P 500 Current Year Estimated Profit Margin 12.26% unch.
  • Bloomberg US Financial Conditions Index -.23 -11.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index -4.70 -11.0 basis points
  • US Yield Curve -37.5 basis points (2s/10s) +17.75 basis points
  • US Atlanta Fed 2Q GDPNow Forecast +2.66% +82.0 basis points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +4.66% unch.: CPI YoY +5.19% unch.
  • 10-Year TIPS Spread 2.19 -3.0 basis points
  • Highest target rate probability for July 26th FOMC meeting: 59.8%(+25.2 percentage points) chance of 4.75%-5.0%. Highest target rate probability for Sept. 20th meeting: 53.3%(+30.2 percentage points) chance of 4.5%-4.75%.
Overseas Futures:
  • Nikkei 225 Futures: Indicating -523 open in Japan 
  • China A50 Futures: Indicating -1 open in China
  • DAX Futures: Indicating +108 open in Germany
Portfolio:
  • Slightly Higher:  On gains in my tech/utility sector longs and index hedges
  • Disclosed Trades:  None
  • Market Exposure: 25% Net Long

Bear Radar

Style Underperformer:

  • Small-Cap Growth -1.3%
Sector Underperformers:
  • 1) Regional Banks -5.1% 2) Airlines -4.4% 3) Steel -3.4%
Stocks Falling on Unusual Volume: 
  • USB, FITB, WFC, CUBI, QCOM, MTSI, JKHY, FORM, SNV, OWL, CFG, INFA, CNOB, SSTK, KNTK, NVST, IBP, GTLB, TNDM, RYI, EVH, AVID, REGN, ETSY, HTLF, XRX, SPR, BAND, URI, WOLF, COHR, TRIP, KTB, TFC, BKU, FULT, FOUR, CDAY, ANDE, LNC, EWBC, ECVT, MET, STAA, UGI, GNK, RVLV, DINO, BWA, TFX, ACLS, CVBF, EQH, SPWR, BOH, OUT, SPT, NGVT, CMA, SBH, PTLO, PENN, ZION, KYMR, CARS, WCC, CG, PLNT, SYNA, RUN, SITM, OPCH, PARA, WAL and FHN
Stocks With Unusual Put Option Activity:
  • 1) DB 2) VSCO 3) AIG 4) FHN 5) KEY
Stocks With Most Negative News Mentions:
  • 1) EVA 2) PACW 3) PARA 4) CG 5) SYNA
Charts:

Bull Radar

Style Outperformer:

  • Large-Cap Growth -.3%
Sector Outperformers:
  • Gold & Silver +2.7% 2) REITs +1.1% 3) Utilities +1.0%
Stocks Rising on Unusual Volume:
  • ARNC, LMND, GRBK, FROG, W, BALL, CFLT, DDOG, LNTH, VSTO, TSVT, UPBD, MGI, SHAK, FLT, IMGN, ZG, QTRX, VITL, RCL, VMC, DGII, SUM, NFE, OLED, PCOR, HUBS, BERY, EXP, CCRN, MRCY, CPE, KTOS, SPB and SDGR
Stocks With Unusual Call Option Activity:
  • 1) IAT 2) FHN 3) BZ 4) LMND 5) MNOX
Stocks With Most Positive News Mentions:
  • 1) LMND 2) SMGI 3) VITL 4) GRBK 5) SEDG

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

Earnings of Note 
Company/Estimate 

Before the Open:
  • (AMC)/-.17
  • (AXL)/-.07
  • (CBOE)/1.87
  • (CNHI)/.32
  • (D)/.97
  • (FUBO)/-.38
  • (FLR)/.37
  • (MGA)/.83
  • (JCI)/.74
  • (WBD)/-.12
After the Close: 
  • None of note

Economic Releases

8:30 am EST:
  • The Change in Non-Farm Payrolls for April is estimated to fall to 180K versus 236K in March.
  • The Unemployment Rate for April is estimated to rise +3.6% versus a +3.5% gain in March.
  • Average Hourly Earnings MoM for April is estimated to rise +.3% versus a +.3% gain in March.
  • The Labor Force Participation Rate for April is estimated at 62.6% versus 62.6% in March.
3:00 pm EST
  • Consumer Credit for March is estimated at $17.0B versus $15.290B in Feb.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The German Factory Orders report could also impact global trading tomorrow.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST

Morning Market Internals

NYSE Composite Index:

  • NYSE Volume Running +37.3% Above 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 7.1 -2.1
  • 9 Sectors Declining, 2 Sectors Rising
  • 22.2% of Issues Advancing, 75.4% Declining
  • 30 New 52-Week Highs, 196 New Lows
  • 37.5%(-2.2%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 39.0 -7
  • Bloomberg Global Risk-On/Risk-Off Index 47.6 -7.7%
  • Russell 1000: Growth/Value 16,193.9 +.49%
  • 1-Day Vix 16.7 -5.2%
  • Vix 21.3 +16.3% 
  • Total Put/Call .89 -18.4%
  • TRIN/Arms 1.03 -20.8%