Stocks Rising into Final Hour on US Economic "Soft-Landing" Hopes, Lower Long-Term Rates, Less European/Emerging Markets/US High-Yield Debt Angst, Tech/Financial Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Around Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 16.2 -4.7%
• DJIA Intraday % Swing .83%
  
• Bloomberg Global Risk On/Risk Off Index 69.2 -.9%

• Euro/Yen Carry Return Index 166.54 -.59%

• Emerging Markets Currency Volatility(VXY) 8.9 -.9%

• CBOE S&P 500 Implied Correlation Index 22.0 -5.3% 

• ISE Sentiment Index 109.0 -5.0 points
  

• Total Put/Call 1.05 +11.7%

• NYSE Arms 1.83 +53.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 66.4 -4.0%
  

• US Energy High-Yield OAS 328.64 -.76%
• Bloomberg TRACE # Distressed Bonds Traded 363.0 unch.
  

• European Financial Sector CDS Index 85.05 -2.9% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 268.5 +2.0%
  

• Italian/German 10Y Yld Spread 165.0 basis points -1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 129.2 -2.8%
  

• Emerging Market CDS Index 210.0 -3.5%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.9 +.7%

• 2-Year SOFR Swap Spread -12.5 basis points unch.
  

• TED Spread 19.0 basis points -4.0 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -11.25 +2.25 basis points
  
• MBS  5/10 Treasury Spread 179.0 -4.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 772.0 +24.0 basis points
  
• Avg. Auto ABS OAS 70.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 42.5 +.32%
• 3-Month T-Bill Yield 5.43% +2.0 basis points
  

• China Iron Ore Spot 113.9 USD/Metric Tonne +.5%
• Dutch TTF Nat Gas(European benchmark) 36.79 euros/megawatt-hour -14.3%

• Citi US Economic Surprise Index 60.0 -9.2 points

• Citi Eurozone Economic Surprise Index -65.2 -13.0 points

• Citi Emerging Markets Economic Surprise Index 2.7 -.3 point
• S&P 500 Current Quarter EPS Growth Rate YoY(478 of 500 reporting) -7.3%  unch.
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 235.73 +.20:  Growth Rate +7.4% +.1 percentage point, P/E 18.8 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.19% +1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(8 of 10 reporting) +17.0% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 234.17 +.07: Growth Rate +42.7% unch., P/E 32.8 +.8
  
• Bloomberg US Financial Conditions Index .26 +13.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .02 +4.0 basis points
  
• US Yield Curve -76.5 basis points (2s/10s) -6.0 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +5.76% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.23% unch.: CPI YoY +3.83% +1.0 basis point
  
• 10-Year TIPS Spread 2.35 unch.
  
• Highest target rate probability for Nov. 1st FOMC meeting: 58.0%(+4.1 percentage points) chance of 5.25%-5.5%. Highest target rate probability for Dec. 13th meeting: 55.3%(+2.6 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +10 open in Japan 
• China A50 Futures: Indicating +15 open in China

• DAX Futures: Indicating +60 open in Germany

Portfolio:

• Higher:  On gains in my tech/industrial/medical/transport sector longs
  

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges and some of my emerging market shorts
  

• Market Exposure: Moved to 100% Net Long
  

Bear Radar

Style Underperformer:

• Large-Cap Value +.7%
  

Sector Underperformers:

• 1) Energy -.4% 2) Electric Vehicles -.3% 3) Shipping -.2%

Stocks Falling on Unusual Volume: 

• ASO, AGTI, HE, PINC and FL
  

Stocks With Unusual Put Option Activity:

• 1) FL 2) ANF 3) DKS 4) PTON 5) GES
  

Stocks With Most Negative News Mentions:

• 1) PTON 2) AMC 3) FL 4) MNK 5) LANC
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +1.5%
  

Sector Outperformers:

• Gold & Silver +3.3% 2) AI/Robotics +2.1% 3) Computer Hardware +2.0%

Stocks Rising on Unusual Volume:

• APLS, ITOS, ANF, RCUS, WSM, ACMR, SMCI, FSLY, RH, UPWK, NXGN, BBWI, PUBM, HDSN, AAON, DY, MOD, NFLX, NSSC, ROST, MTSI, MRK, TPVG, ACEL, LII, CRNX, KSS, BF/B, GPCR, AAP and LMB
  

Stocks With Unusual Call Option Activity:

• 1) ANF 2) FL 3) WSM 4) IYR 5) DBI

Stocks With Most Positive News Mentions:

• 1) VCIG 2) ANF 3) ITOS 4) WSM 5) APLS
  

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:

• (FRO)/.84
• (NTES)/9.14
• (TD)/1.51 
• (WB)/.51
• (BURL)/.44
• (HAIN)/.10
• (WOOF)/.06
• (DLTR)/.87
  

After the Close: 

• (JWN)/.45
• (WDAY)/1.26 
• (INTU)/1.43
• (AFRM)/-.87
• (ULTA)/5.85
• (GPS)/.09
  

Economic Releases   

8:30 am EST

• Initial Jobless Claims for last week are estimated to rise to 240K versus 239K the prior week.
• Continuing Claims are estimated to fall to 1705K versus 1716K prior.
• Chicago Fed National Activity Index for July is estimated to rise to -.22 versus -.32 in June.
• Durable Goods Orders for July is estimated to fall -4.0% versus a +4.6% gain in June.
• Durables Ex Transports for July is estimated to rise +.2% versus a +.5% gain in June.
• Cap Goods Orders Non-Defense Ex-Air for July is estimated to rise +.1% versus a +.1% gain in June.
  

11:00 am EST

• The Kansas City Fed Manufacturing Activity Index for Aug. is estimated to rise to -10 versus -11 in July.

Upcoming Splits 

• (AMC) 1-for-10
  

Other Potential Market Movers

• The ECB minutes, weekly EIA natural gas inventory report and the (SHW) Financial Presentation could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• NYSE Volume Running -2.3% Below 100-Day Average 
• Nasdaq/NYSE Volume Ratio 7.9 -2.3
  
• 1 Sector Declining, 10 Sectors Rising
• 76.7% of Issues Advancing, 21.3% Declining
• 33 New 52-Week Highs, 49 New Lows
• 46.2%(+4.6%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 41.0 +7.0
  
• Bloomberg Global Risk-On/Risk-Off Index 69.0 -1.2%
  
• Russell 1000: Growth/Value 17,544.2 +.90%
• 1-Day Vix 12.1 -5.5%
  
• Vix 16.2 -4.8%
  
• Total Put/Call 1.0 +6.4%
• TRIN/Arms 1.92 +61.3%
  

Wednesday Watch

Evening Headlines

Bloomberg:

• Country Garden Leaves Investors in Dark on Exact Default Deadline.
• Lithium Craze Sparks 1,100% Stock Gains as Well as Deep Losses.
• Global Banks’ Currency Desks Take 15% Hit on Volatility Slump.
• Asian Equity Futures Decline as Risk Tone Falters: Markets Wrap.
• More Than One-Third of Desks Globally Sit Empty All Week Long.
• Goldman Dials Up Pressure to Enforce Five Days a Week in Office.
• Nike Suffers Record Rout on China Concern, Inventory Woes.
• Dan Och Slams Sculptor Proxy With Demand for Merger Books, Records.
• Spoofing Is a Silly Name for Serious Market Rigging.
• Luxury Builder Toll Brothers Beats Estimates for Home Orders.
• Traders Dial Back Expected Fed Rate Cuts as Recession Risks Ease.
• FDIC to Propose New Regulations for Midsize Lenders Next Week.

Zero Hedge:

• 'Children Were Incinerated To Ash': Livid Hawaiians Slam Biden For Cracking Jokes, Lying About Wife.
• It's Really Happening: Mask Mandates, Contact-Tracing Re-Implemented At Colleges, Offices.
• A Letter To Our Betters.
• A Sober Look At Four Indictments.
• Bud Light Backlash "Shows Little Signs Of Abating", Citi Warns.
• How Much Of Today's 'Racism' Is Manufactured?
• China Retaliates Over Fukushima Water Dump: Blocks Seafood Imports As Nobody "Wants To Eat Radioactive Salmon".
• Garland's Theater Of The Absurd: Why The Hunter Biden Scandal Is No Longer A Laughing Matter. 
• Who Turns Downs Millions? People Who Believe We Are Heading For "F**k It" Phase.
• "This Is About Credit Card Balances, This Is About Student Loans": Macy's Crashes As Consumer Situation Deteriorates.
• S&P Joins Downgrade Party Of US Banks Due To "Tough" Climate.
• 14 US Cities Initiate New Globalist Climate Plan In Partnership With Soros & The Clintons.
• US stocks were mostly lower and bonds were mixed as markets await key events - Newsquawk Asia-Pac Market Open.
• 'Bread And Water': Bankman-Fried Denied Vegan Meals, Adderall -- And Is Running Out Of Anti-Depressant.
• Andy Ngo Awarded $300,000 In Antifa Attack Lawsuit.
• The 'Ukraine Failure' Script Is Already Being Written & Only One Man Will Be Blamed.
• Chicago Official Suggests "Purge" Style Ordinance For Gun Violence Prevention.
• WTI Extends Losses After API Reports Smaller Than Expected Crude Draw.
• Can tech dismiss rising rates?
• Rickards: The 'Earthquake' Starts Today.
• Dollar bid, bonds mixed as participants await PMIs and Powell - Newsquawk US Market Wrap.
• BJ's Blows It & Dick's Shrink: Consumer Concerns Spook Stocks, Flattens Yield-Curve.

Wall Street Journal:

• The Electric-Vehicle Bubble Starts to Deflate. Biden is imitating China just as its industrial policy starts to crack.
• Goodbye Bathtub and Living Room. America’s Homes Are Shrinking.
• Dick’s Sporting Goods, Macy’s Flash Warnings Over Consumers.
• Activist Behind Affirmative-Action Cases Sues Law Firms.
• The Biggest Player in Crypto Is Facing a Risk Over Russia.
• Hunter Biden’s Foreign Dealings Spell More Trouble Ahead.
• U.S. to Sanction Chinese Officials for Forcible Assimilation of Tibetans.
• The Bidding War for Workers Is Over.
• America’s Disappearing Nursing Homes, in Charts.
• OSHA Investigates Chemical Spill at GM’s Ultium Battery Plant.

CNBC.com:

• Dick’s shares fall 24% as retailer slashes outlook over theft concerns.
• Amazon is seeing some employees quit instead of moving to a new state as part of relocation mandate.
• Hawaii wildfires caused up to $6 billion in economic losses, Moody’s estimates.
• The 15 U.S. cities with the highest cost of living—San Francisco isn’t No. 1.
• AMC shares crater as investors brace for stock conversion.

MarketWatch:    

• Dick’s Sporting Goods CEO highlights impact of organized retail crime: ‘It’s quite alarming what’s going on’.
• All S&P 500 sectors are down in August, on pace for a broad monthly drop not seen this year
• CDs at 6%? How high could they go?
• Icahn investment arm’s stock slides anew and is close to its 52-week low
• UPS workers vote to approve ‘historic’ five-year contract

Newsmax:

• Lake: Trump Indictments Distraction to Hide Biden Corruption
• Donald Trump Jr: Dems Aim to 'Jail,' 'Silence' Opponents
• Incoming Ga. Commission Could Punish DA Willis.
• Dick Morris: Biden Beholden to 'Chinese Masters'.
• Huckabee: Biden Paid No Taxes on Laundered Cash.

Fox News:

• Jennifer Aniston lets loose on how she really feels about cancel culture

TheGatewayPundit.com:

• THE GREAT RESET: Report Reveals Globalist Climate Organization’s Goal to Ban Meat, Dairy, and Private Vehicles In 14 US Cities by 2030
• Angry Maui Fire Survivors Let Loose With Middle Fingers and F-Bombs at Joe Biden as Motorcade Passes (Video).
• FOX News Throws Tantrums – Bans Trump’s Surrogates from GOP Debate Spin Room Following Trump’s Decision to Skip Debate.
• Sam Bankman-Fried Whines He Isn’t Getting His Adderall and Vegan Meals in Prison.
• St. Louis Mayor Announces Plans to Outlaw AR-15s, AK-47s and Military-Style Weapons – Hopes Criminals Will Comply.
• Former University of Houston Basketball Player Reggie Chaney Dead at 23 – Cause Unknown.
• COMMUNISM THREATENS AMERICA: Brazilian President Lula da Silva Pushes to Weaken the Dollar and Create Single Currency with China and BRICS Countries.
• BRICS Summit, Day One: Xi Hypes the ‘Global South’, Putin Sees ‘Alternative to G7’, Modi Touts Indian Economy, Lula Calls for Common Currency, Ramaphosa Stresses Ties Between Members.
• Did Joe Biden Nod Off or Check His Watch During Maui Wildfire Memorial Service? (VIDEO).
• HORROR: Low-Life Thugs Beat and then Violently Drag Defenseless Woman On the Ground During Armed Robbery in Oakland – Business Owner Compares Crime Wave in Leftist City to Vietnam War (VIDEO).
• Joe Biden Spits on Constitution Again and Announces New Student Loan Bailout Scheme – Will Cost Taxpayers Hundreds of Billions of Dollars (VIDEO).
• Trump Attorney John Eastman Booked at Fulton County Jail For Challenging 2020 Democrat Election Fraud.
• Surprise! Look Who’s on Anti-Woke Warpath to Reclaim ‘Redskins’ Name.
• Here We Go: Lionsgate Studio Reinstates Employee Mask Mandate Despite Very Low COVID Cases. 
• BREAKING: Insider Says Lockdowns & Masks RETURNING This FALL?!! | Elijah Schaffer’s Top Picks (VIDEO).

The Epoch Times:  

• China's Economic 'Perfect Storm' Accelerates Decoupling With US: Christopher Balding
• Trump Will Be Treated as a Common Prisoner: Fulton County Sheriff
• The Mounting Risks in Chinese Banking

Twitter: 

• @nicksortor - MAUI POLICE HEADLOCK ME FOR ASKING THE MAYOR ABOUT MISSING CHILDREN. MAYOR BISSEN KNOWS THE ANSWER, BUT HE’S HIDING IT. The mainstream media have been REFUSING to press the Mayor on this, so residents and I started pressing him HARD for the past SEVERAL DAYS. (video)
• @Truthpole - It has been nearly two weeks and still no confirmation about the missing people and CHILDREN in Maui. (video)
• @HumanDilemma_ - Maui Fire - Biden to Maui: I lost my house too. (video) Maui Fire - What it's actually like on the ground in West Maui. (video)
• @ggreenwald - Always worth recalling that much of what is now being covered as the Hunter **and Joe** Biden scandals was known before the 2020 election. But media outlets endorsed the obvious CIA lie that the docs were "Russian disinformation" and got Big Tech to censor it based on that lie.
• @The_Real_Fly - MACY’S, CALIFORNIA. (video)
• @CitizenFreePres - Oliver Anthony just dropped a new song. "Brink of War." (video)
• @charliekirk11 - Masks are now being sold at check out at Whole Foods in Arizona. Hollywood now demanding masks. Rutgers now demanding masks. Federal government buying COVID "supplies". It's coming.

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 977,541 Reports(+2,427 from prior week) Through August 4th, 2023.

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.

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 131.5 -4.25 basis points. 

• China Sovereign CDS 81.25 -2.75 basis points.
  
• China Iron Ore Spot 110.9 USD/Metric Tonne +.15%.

• Bloomberg Emerging Markets Currency Index 42.4 -.01%.
• Bloomberg Global Risk-On/Risk Off Index 70.7 +1.3%. 
• Bloomberg US Financial Conditions Index 12.0 -1.0 basis point.
  
• Volatility Index(VIX) futures 17.8 -.56%.
• Euro Stoxx 50 futures +.02%.

• S&P 500 futures +.16%.

• NASDAQ 100 futures +.22%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by industrial and consumer shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 75% net long heading into the day.