Wednesday, May 10, 2023

Thursday Watch

Evening Headlines

Bloomberg:

Zero Hedge:
Wall Street Journal:
TheGatewayPundit.com:
The Epoch Times:
Twitter: 
OpenVAERS:
SKirsch.com:
Night Trading 
  • Asian equity indices are -.25% to +.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 132.0 -2.75 basis points. 
  • China Sovereign CDS 72.0 -4.75 basis points.
  • China Iron Ore Spot 101.4 USD/Metric Tonne -1.8%.
  • Bloomberg Emerging Markets Currency Index 47.9 +.04%.
  • Bloomberg Global Risk-On/Risk Off Index 54.5 -.22%. 
  • Bloomberg US Financial Conditions Index -.07 -4.0 basis points.
  • Volatility Index(VIX) futures 20.7 -.26%.
  • Euro Stoxx 50 futures +.19%.
  • S&P 500 futures +.20%.
  • NASDAQ 100 futures +.15%.  
Morning Preview Links

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

Stocks Reversing Lower into Afternoon on US Policy-Induced Stagflation Fears, Regional Bank Contagion Concerns, Global Growth Worries, Financial/Commodity Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Modestly Higher
  • Sector Performance: Mixed
  • Volume: Around Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 17.1 -3.3%
  • DJIA Intraday % Swing 1.24%
  • Bloomberg Global Risk On/Risk Off Index 54.3 -1.2%
  • Euro/Yen Carry Return Index 154.3 -.6%
  • Emerging Markets Currency Volatility(VXY) 9.59 -.72%
  • CBOE S&P 500 Implied Correlation Index 33.8 -2.5% 
  • ISE Sentiment Index 120.0 +6.0 points
  • Total Put/Call .88 -3.3%
  • NYSE Arms 1.54 +73.0%
Credit Investor Angst:
  • North American Investment Grade CDS Index 82.08 -.01%
  • US Energy High-Yield OAS 415.15 +.70%
  • Bloomberg TRACE # Distressed Bonds Traded 425.0 -1.0
  • European Financial Sector CDS Index 103.15 -1.3% 
  • Deutsche Bank Subordinated 5Y Credit Default Swap 392.62 +1.4%
  • Italian/German 10Y Yld Spread 191.0 basis points -2.0 basis points
  • Asia Ex-Japan Investment Grade CDS Index 134.5 unch.
  • Emerging Market CDS Index 251.66 -.92%
  • China Corp. High-Yield Bond USD ETF(KHYB) 26.4 -.13%
  • 2-Year Swap Spread 25.25 basis points +2.0 basis points
  • TED Spread 11.75 basis points -3.75 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -19.25 -.5 basis point
  • MBS  5/10 Treasury Spread 171.0 -1.0 basis point
  • Bloomberg CMBS Investment Grade Bbb Average OAS 715.0 +1.0 basis point
  • Avg. Auto ABS OAS 94.0 unch.
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 47.9 +.15%
  • 3-Month T-Bill Yield 5.22% unch.
  • China Iron Ore Spot 100.75 USD/Metric Tonne -2.5%
  • Dutch TTF Nat Gas(European benchmark) 35.0 euros/megawatt-hour -2.7%
  • Citi US Economic Surprise Index 17.1 -.7 point
  • Citi Eurozone Economic Surprise Index -21.2 -.9 point
  • Citi Emerging Markets Economic Surprise Index 39.6 -.2 point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 227.84 -.09:  Growth Rate +2.2% -.1 percentage point, P/E 18.1 unch.
  • S&P 500 Current Year Estimated Profit Margin 12.24% -1.0 basis point
  • Bloomberg US Financial Conditions Index -.04 -3.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index -4.40 -5.0 basis points
  • US Yield Curve -45.75 basis points (2s/10s) +4.75 basis points
  • US Atlanta Fed 2Q GDPNow Forecast +2.75% unch.
  • Cleveland Fed Inflation Nowcast Core PCE YoY +4.65% -1.0 basis point: CPI YoY +4.14% -105.0 basis points
  • 10-Year TIPS Spread 2.20 -3.0 basis points
  • Highest target rate probability for July 26th FOMC meeting: 54.7%(-2.7 percentage points) chance of 5.0%-5.25%. Highest target rate probability for Sept. 20th meeting: 51.1%(+5.0 percentage points) chance of 4.75%-5.0%.
Overseas Futures:
  • Nikkei 225 Futures: Indicating -162 open in Japan 
  • China A50 Futures: Indicating -19 open in China
  • DAX Futures: Indicating +13 open in Germany
Portfolio:
  • Higher:  On gains in my tech/utility sector longs, emerging market shorts and index hedges
  • Disclosed Trades:  Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 25% Net Long

Bear Radar

Style Underperformer:

  • Large-Cap Value -.4%
Sector Underperformers:
  • 1) Gambling -1.9% 2) Steel -1.8% 3) Regional Banks -1.0%
Stocks Falling on Unusual Volume: 
  • PYPL, EDR, XENE, SITE, CTLT, LITE, CHH, ZIP, OXY, FHN, STR, HRB, EWCZ, VERX, LBTYK, NNOX, HAIN, HRT, VYGR, PENN, MLCO, PFGC, LBTYA, BE, NYT, LNC, BOWL, RRR, CPNG, SKIN, RDY, TFPM, TTGT, SCCO, IRBT, MASI, EHAB, COHR, RVNC, ASLE, GDS, BROS, SPHR, ABNB, IAS, AMPL, SRAD, AXON, PRAA, CUTR, SILK, AZTA, TWLO, NVEI, MODG, JXN, IEP, RETA, ARQT and PRA
Stocks With Unusual Put Option Activity:
  • 1) OPEN 2) SRPT 3) EMB 4) ABNB 5) STNE
Stocks With Most Negative News Mentions:
  • 1) RETA 2) JXN 3) UWMC 4) AMPL 5) MLCO
Charts:

Bull Radar

Style Outperformer:

  • Large-Cap Growth +.7%
Sector Outperformers:
  • Alt Energy +2.4% 2) Cyber Security +1.2% 3) Semis +1.1%
Stocks Rising on Unusual Volume:
  • UPST, CELH, LZ, RNG, MBC, CARG, QTWO, IAC, VSH, VVV, PUBM, RIOT, EXAS, WWW, HALO, PETQ, RXST, SKWD, DUOL, CVNA, GH, SYNH, DAR, ZS, AKAM, MSTR, TOST, FCNCA, LTHM, RIVN, ILMN, RBLX, EVRI, AMD, FLYW, MRVI, AFRM, AMRK and APPN
Stocks With Unusual Call Option Activity:
  • 1) IAU 2) CTIC 3) TOST 4) BEKE 5) ASRT
Stocks With Most Positive News Mentions:
  • 1) CTIC 2) UPST 3) CELH 4) LI 5) EXAS

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

Earnings of Note 
Company/Estimate 

Before the Open:
  • (FLWS)/-.36
  • (CRL)/2.59
  • (DDS)/7.94
  • (JD)/3.50
  • (DNUT)/.07
  • (PKI)/1.02
  • (TPR)/.60
  • (TNK)/4.40
  • (YETI)/.16
After the Close: 
  • (NWSA)/.04
  • (SANM)/1.55

Economic Releases

8:30 am EST
  • Initial Jobless Claims for last week are estimated to rise to 245K versus 242K the prior week.
  • Continuing Claims are estimated to rise to 1820K versus 1805K prior.
  • PPI Final Demand MoM for April is estimated to rise +.3% versus a -.5% decline in March.
  • PPI Ex Food and Energy MoM for April is estimated to rise +.2% versus a -.1% decline in March.
  • PPI Ex Food, Energy and Trade YoY for April is estimated to rise +3.5% versus a +3.6% gain in March.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Fed's Waller speaking, BofE decision, 30Y T-Bond auction, weekly EIA natural gas inventory report and the (H) investor day 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 +11.2% Above 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 9.3 +.6
  • 7 Sectors Declining, 4 Sectors Rising
  • 40.7% of Issues Advancing, 55.7% Declining
  • 46 New 52-Week Highs, 74 New Lows
  • 41.4%(+4.4%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 47.0 -1
  • Bloomberg Global Risk-On/Risk-Off Index 54.1 -1.6%
  • Russell 1000: Growth/Value 16,423.3 +.80%
  • 1-Day Vix 12.6 -31.0%
  • Vix 17.6 -.9% 
  • Total Put/Call .90 -1.10%
  • TRIN/Arms 1.46 +64.0%