Stocks Modestly Higher into Afternoon on Rising Fed Rate-Cut Odds, US Economic "Soft-Landing" Hopes, Technical Buying, Financial/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Lower
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.7 -3.3%
• DJIA Intraday % Swing .74% -5.2%
  
• Bloomberg Global Risk On/Risk Off Index 57.6 +2.9%

• Euro/Yen Carry Return Index 170.6 +.2%

• Emerging Markets Currency Volatility(VXY) 7.98 -.50%

• CBOE S&P 500 Implied Correlation Index 21.1 +.4% 

• ISE Sentiment Index 145.0 +1.0
  

• Total Put/Call 1.24 +31.9%

• NYSE Arms .89 +18.7% 
• NYSE Non-Block Money Flow -$219.3M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 59.0 -1.8%
  

• US Energy High-Yield OAS 346.4 -.57%
• Bloomberg TRACE # Distressed Bonds Traded 297 +26
  

• European Financial Sector CDS Index 72.66 -1.5% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 223.47 +.54%
  

• Italian/German 10Y Yld Spread 170.0 basis points +1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 102.5 +3.6%
  

• Emerging Market CDS Index 181.73 -1.3%
• Israel Sovereign CDS 112.61 -.44%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.27 +.51%

• 2-Year SOFR Swap Spread -16.75 basis points +.25 basis point
  

• TED Spread 22.25 basis points +1.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -4.5 -1.25 basis points
  
• MBS  5/10 Treasury Spread 149.0 unch.
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 966.0 unch.
  
• Avg. Auto ABS OAS 75.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.36 +.02%
• 3-Month T-Bill Yield 5.37% -1.0 basis point
  

• China Iron Ore Spot 138.5 USD/Metric Tonne -.06%
• Dutch TTF Nat Gas(European benchmark) 34.55 euros/megawatt-hour +3.4%

• Citi US Economic Surprise Index 6.1 -.3 point

• Citi Eurozone Economic Surprise Index -31.3 -.9 point

• Citi Emerging Markets Economic Surprise Index 15.5 unch.
• S&P 500 Current Quarter EPS Growth Rate YoY(21 of 500 reporting) +9.1% +.1 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 243.48 +.05:  Growth Rate +11.9% unch., P/E 19.3 -.1
  
• S&P 500 Current Year Estimated Profit Margin 12.04% -1.0 basis point
  
• 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 290.03 +.13: Growth Rate +36.0% +.1 percentage point, P/E 29.1 unch.
  
• Bloomberg US Financial Conditions Index n/a
  
• Bloomberg Euro-Zone Financial Conditions Index .40 +7.0 basis points
  
• US Yield Curve -35.5 basis points (2s/10s) +4.25 basis points
  
• US Atlanta Fed 4Q GDPNow Forecast +2.51% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 63.0% -2.7 percentage points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.02% unch.: CPI YoY +3.32% unch.
  
• 10-Year TIPS Spread 2.23 +1.0 basis point
  
• Highest target rate probability for March 20th FOMC meeting: 62.1%(-.2 percentage point) chance of 5.0%-5.25%. Highest target rate probability for May 1st meeting: 53.2%(+4.3 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +48 open in Japan 
• China A50 Futures: Indicating -14 open in China

• DAX Futures: Indicating +137 open in Germany

Portfolio:

• Slightly Lower:  On losses in my index hedges and emerging market shorts
  

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges
  

• Market Exposure: Moved to 50% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Growth -.4%
  

Sector Underperformers:

• 1) Alt Energy -1.8% 2) Restaurants -.8% 3) Computer Services -.7%

Stocks Falling on Unusual Volume: 

• CMTG, GFI, LBPH, SMPL, OR, SATS, PLAY, PZZA, YUMC, RUN, GCT, NTES, XPEV, METC, INBX, BILI, SYM, DNLI, DAR, BGNE, HUT, IMCR, DYN, OLMA, MARA and CPRX
  

Stocks With Unusual Put Option Activity:

• 1) MPW 2) DXCM 3) STZ 4) TMF 5) QS
  

Stocks With Most Negative News Mentions:

• 1) MPW 2) ANGO 3) FSR 4) GDHG 5) PLTR
  

Charts:

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

Bull Radar

Style Outperformer:

• Mid-Cap Value +.2%
  

Sector Outperformers:

• 1) Airlines +1.7% 2) Banks +1.5% 3) Shipping +.9%

Stocks Rising on Unusual Volume:

• GBX, LQDA and MRVL
  

Stocks With Unusual Call Option Activity:

• 1) PACB 2) SHY 3) ELAN 4) PTON 5) DISH

Stocks With Most Positive News Mentions:

• 1) AXGN 2) INGN 3) DRMA 4) KSCP 5) FFWM
  

Charts:

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

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

Earnings of Note 
Company/Estimate 

Before the Open:

• (HELE)/2.75
• (CMC)/1.47
  

After the Close: 

• (ACCD)/-.45
• (JEF)/.26
  

Economic Releases

3:00 pm EST

• Consumer Credit for Nov. is estimated to rise to $9.5B versus $5.134B in Oct.
  

Upcoming Splits 

• None of note
  

Other Potential Market Movers

• The NY Fed 1Y Consumer Inflation Expectations Index, CB Employment Trends Index for Dec., Consumer Electronics Show, JPMorgan Healthcare Conference and the UBS Energy/Utilities Conference could also impact global trading on Monday.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Morning Market Internals

NYSE Composite Index:

• Volume Running +7.7% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 11.0 -.8
  
• 0 Sectors Declining, 11 Sectors Rising
• 74.9% of Issues Advancing, 22.5% Declining 
• TRIN/Arms 1.27 +69.3% 
• Non-Block Money Flow -$92.1M
  
• 44 New 52-Week Highs, 12 New Lows
• 63.5%(+1.6%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 65.0 +1.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 56.6 +1.1%
• Bloomberg Cyclicals/Defensives Pair Index 137.8 +.38%
  
• Russell 1000: Growth/Value 17,941.1 -.02%
• CNN Fear & Greed Index 73.0 (Greed) -5.0
• 1-Day Vix 9.3 -29.2%
  
• Vix 13.3 -5.6%
  
• Total Put/Call 1.36 +44.7%

Friday Watch

Evening Headlines

X:

• @1CoastalJournal - The Bank program at the Fed just hit another record high of $141 Billion! This is the first time BTFP soars and the $SPY didn’t follow. The banking stress seems to be getting worse as the program is suppose to end in the next 40 days or so. (graph)
• @TheChiefNerd - Joe Rogan & Dr. Debra Soh on Vaccine Injuries & Doctors Who Spoke Out Against the Narrative. "Everyone knows someone that had something go wrong... (video)
• stclairashley - Incredible reporting from James on who is funding and assisting in the migrant crisis. Why is the IRC allowed to receive $415 MILLION in taxpayers dollars and not answer any questions? INSANITY! Why is the EU sending this org $75 million as well? 
• zerohedge - Sea-Change: Most Hispanics Now Prefer Trump - Biden's Black Support Plummets From 2020. BLACKMAIL. US Interest expense ~$1.1 trillion as of today. That's $250BN more than the Defense Budget; $250BN more than spending on Medicare, $200BN more than spending on health, and will surpass the $1.35 trillion spending on Social Security this year, becoming the single biggest outlay. (graph)
• @WallStreetSilv - The left is actively trying to ruin everything. Why? This is a former Canadian secret intelligence service intel officer, and he just testified about Justin Trudeau: "We can prove every federal government, from Mr. Mulroney to Mr. Trudeau, has been compromised by an agent of communist China". (video) This is insane ... This is in Shenzhen, China. These ''Digital Sentinels'' aka ''QR code passport machines'' are everywhere, including your home ... They are tracking every time you go anywhere now. (video)
  
• @The_Real_Fly - Nikki Haley Wants Illegal Migrants. (video) Migrants Exploit Loophole in NYC. (video)
  
• @Techno_Fog - Epstein Victim Virginia Giuffre states she slept with billionaire Tom Pritzker (another John Doe) "once". Pritzker is a member of the prestigious Aspen Institute and Executive Chairman of Hyatt Hotels.
• @ToyClimate - When climate models fail, the modelers (@NASA's James Hansen in this case) simply change the data to match their model. #ClimateScam (graph)
• @GenFlynn - “TRUMP: never on Epstein Island or in Epstein’s homes. Fully exonerated. Receives an FBI raid. 91 felony charges. CLINTON: “liked his girls young” and visited Epstein Island more than 25 times. No FBI raid. 0 charges Are you paying attention yet?
• @charliekirk11 - Everyone should read this. President Trump Releases Summary of Election Fraud in the 2020 Presidential Election in the Swing States.
• @OliLondonTV - “LGBT people in Gaza face beheadings, they are thrown off buildings…it’s really shocking to see the level of indoctrination that somebody that is Trans or Non-Binary or Gay would support people that would k*ll them if they stepped foot in Gaza.” (video)
• @wideawake_media - Bill Gates―a man who believes the world to be massively overpopulated―funds the world's largest mosquito factory, which breeds 30 million bacteria-infused mosquitos per week, then unleashes them on to the unsuspecting public, "to save and improve millions of lives". (video) "We're undergoing a soft coup... under the pretext of pandemic preparedness and the biosecurity agenda." (video)
• @JunkScience - Australia ignores temperature records set before 1910 because they spoil the climate narrative, explains @TonyClimate in terrific 5 minute video.
• @songpinganq - This is what a China's 15-minute city looks like. Shenzhen city. These people lining up to get their face and vaccine passport scanned in order to go back to their neighborhood, to go home. If you are not vaccinated, you will be banned from going home! (video) Chinese Covid prisoners stretched their heads out of the windows in a quarantine camp, in China's Langfang city. The Chinese government used the pandemic to accumulate ever more power. The result was a totalitarian, anti-scientific humanitarian catastrophe. (video)
• @ClownWorld_ - Police investigating first case of girl's virtual gang rape in the metaverse. (pic) Don’t piss off people who grow your food. (video)

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 997,917 Reports(+9,212 from prior week) Through November 3rd, 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 -.5% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 100.0 +2.0 basis points.

• China Sovereign CDS 65.0 +.25 basis point.
  
• China Iron Ore Spot 138.0 USD/Metric Tonne -2.1%.

• Bloomberg Emerging Markets Currency Index 41.3 -.1%.
• Bloomberg Global Risk-On/Risk Off Index 57.5 +2.6%.
  
• Bloomberg US Financial Conditions Index n/a.
  
• Volatility Index(VIX) futures 15.6 -.22%.
• Euro Stoxx 50 futures -.38%.

• S&P 500 futures +.09%.

• NASDAQ 100 futures +.06%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly lower, weighed down by technology and industrial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 25% net long heading into the day.