Afternoon Market Internals

NYSE Composite Index:

• Volume Running +81.2% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 9.4 -2.0
  
• 4 Sectors Declining, 7 Sectors Rising
• 79.6% of Issues Advancing, 19.2% Declining 
• TRIN/Arms .92 +22.7% 
• Non-Block Money Flow +$267.4M
  
• 353 New 52-Week Highs, 9 New Lows
• 63.7%(+7.8%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 80.0 +11.0

Other:

• Bloomberg Global Risk-On/Risk-Off Index 57.4 +5.2%
  
• Russell 1000: Growth/Value 18,074.7 -2.0%
  
• 1-Day Vix 12.5 -18.3%
  
• Vix 12.4 +1.5%
  
• Total Put/Call .74 -27.5%

Thursday Watch

Night Trading 

• Asian equity indices are +.75% to +1.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 94.75 -2.0 basis points.

• China Sovereign CDS 57.75 -2.0 basis points.
  
• China Iron Ore Spot 135.2 USD/Metric Tonne +1.2%.

• Bloomberg Emerging Markets Currency Index 41.66 +.08%.
• Bloomberg Global Risk-On/Risk Off Index 56.9 +4.2%.
  
• Bloomberg US Financial Conditions Index .55 +3.0 basis points.
  
• Volatility Index(VIX) futures 14.1 -.8%.
• Euro Stoxx 50 futures +1.17%.

• S&P 500 futures +.33%.

• NASDAQ 100 futures +.51%.  

Morning Preview Links

BOTTOM LINE: Asian indices are modestly higher, boosted by industrial and consumer shares in the region. I expect US stocks to open modestly higher and to maintain gains into the afternoon.  The Portfolio is 100% net long heading into the day.

Stocks Surging into Close on Soaring Fed Rate-Cut Odds, Plunging Long-Term Rates, Short-Covering, Financial/Biotech Sector Strength

Economic Gauges:

• S&P 500 Current Quarter EPS Growth Rate YoY(2 of 500 reporting) +13.1% unch.
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 242.88 -.06:  Growth Rate +11.5% -.1 percentage point, P/E 19.1 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.09% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) +0.0% -0.0 percentage points
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 293.0 +6.8: Growth Rate +37.4% +.1 percentage point, P/E 28.8 +.3
  
• Bloomberg US Financial Conditions Index .54 -9.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .42 +8.0 basis points
  
• US Yield Curve -43.0 basis points (2s/10s) +9.5 basis points
  
• US Atlanta Fed 4Q GDPNow Forecast +1.25% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 53.9% -1.6 percentage points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.43% unch.: CPI YoY +3.38% unch.
  
• 10-Year TIPS Spread 2.17 -1.0 basis point
  
• Highest target rate probability for Jan. 31st FOMC meeting: 81.9%(-11.3 percentage points) chance of 5.25%-5.5%. Highest target rate probability for March 20th meeting: 62.8%(+23.1 percentage points) chance of 5.0%-5.25%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -81 open in Japan 
• China A50 Futures: Indicating +48 open in China

• DAX Futures: Indicating +115 open in Germany

Portfolio:

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

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges and added consumer discretionary sector longs
  

• Market Exposure: Moved to 100% Net Long
  

Bull Radar

Style Outperformer:

• Small-Cap Value +3.1%
  

Sector Outperformers:

• 1) Regional Banks +4.8% 2) Alt Energy +4.8% 3) REITs +3.9%

Stocks Rising on Unusual Volume:

• ACAD, PLAB, ABM, XPOF, AAOI, CLSK, OPRA, UPST, VRTX, ZLAB, JBGS, CALM, Z, ZG, RKT, REVG, CORT, PERI, PLSE, W, BLBD, LIVN, DRVN, VET, X, AMPH, GFL, MFA, BFH, MAG, CAR, CION, NVST, IMCR, MTCH, FRSH, ASND, PGTI, TTWO, REXR, TWO, FNV, INFA, BSAC and INCY
  

Stocks With Unusual Call Option Activity:

• 1) DLR 2) CCI 3) GILD 4) CMA 5) CALM

Stocks With Most Positive News Mentions:

• 1) PLAB 2) ACAD 3) CCCC 4) VRTX 5) AAOI
  

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:

• (JBL)/2.58

After the Close: 

• (COST)/3.41
• (LEN)/4.59
  

Economic Releases

8:30 am EST

• Retail Sales Advance MoM for Nov. is estimated to fall -.1% versus a -.1% decline in Oct.
• Retail Sales Ex Autos MoM for Nov. is estimated to fall -.1% versus a +.1% gain in Oct.
• Retail Sales Ex Autos and Gas for Nov. is estimated to rise +.2% versus a +.1% gain in Oct.
• Initial Jobless Claims for last week is estimated at 220K versus 220K the prior week.
• Continuing Claims is estimated to rise to 1879K versus 1861K prior. 
• The Import Price Index MoM for Nov. is estimated to fall -.8% versus a -.8% decline in Oct.
• The Import Price Index Ex Petrol for Nov. is estimated to fall -.2% versus a -.2% decline in Oct.
• The Export Price Index MoM for Nov. is estimated to fall -1.0% versus a -1.1% decline in Oct.
  

10:00 am EST

• Business Inventories for Oct. is estimated to fall -.1% versus a +.4% gain in Sept.
  

Upcoming Splits 

• None of note
  

Other Potential Market Movers

• The 4Q Atlanta Fed GDPNow update, Fed's balance sheet report, IEA monthly report, EIA natural gas inventory report, (INTC) investor meeting, (MCO) business update, (COHR) business update and the (REGN) business update could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Afternoon Market Internals

NYSE Composite Index:

• Volume Running -2.1% Below 100-Day Average 
• Nasdaq/NYSE Volume Ratio 11.4 +1.1
  
• 4 Sectors Declining, 7 Sectors Rising
• 45.9% of Issues Advancing, 51.1% Declining 
• TRIN/Arms 1.33 -7.6% 
• Non-Block Money Flow -$.5M
  
• 101 New 52-Week Highs, 21 New Lows
• 53.8%(+1.0%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 69.0 +1.0

Other:

• Bloomberg Global Risk-On/Risk-Off Index 57.0 -6.0%
  
• Russell 1000: Growth/Value 18,575.9 +.18%
  
• 1-Day Vix 14.6 +15.9%
  
• Vix 12.4 +3.0%
  
• Total Put/Call .85 -14.1%