Stocks Surging into Final Hour on Earnings Outlook Optimism, Diminished China Economy Fears, Technical Buying, Tech/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.9 -8.5%
• DJIA Intraday % Swing .68 n/a
  
• Bloomberg Global Risk On/Risk Off Index 67.4 +3.8%

• Euro/Yen Carry Return Index 174.7 +.5%

• Emerging Markets Currency Volatility(VXY) 6.3 -1.1%

• CBOE S&P 500 Implied Correlation Index 12.8 -13.8% 

• ISE Sentiment Index 131.0 -5.0
  

• Total Put/Call 1.01 -2.9%

• NYSE Arms .97 +44.8%
  
• NYSE Non-Block Money Flow -$13.2M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 48.9 -1.4%
  

• US Energy High-Yield OAS 297.0 -1.1%
• Bloomberg TRACE # Distressed Bonds Traded 276 -8
  

• European Financial Sector CDS Index 60.0 -1.2% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 186.8 -2.5%
  

• Italian/German 10Y Yld Spread 128.0 basis points -5.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 99.9 -.06%
  

• Emerging Market CDS Index 163.0 -1.1%
• Israel Sovereign CDS 113.6 -3.7%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.7 unch.

• 2-Year SOFR Swap Spread -11.5 basis points -.25 basis point
  

• Treasury Repo 3M T-Bill Spread 8.75 basis points -1.0 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -5.0 +.25 basis point
  
• MBS  5/10 Treasury Spread 146.0 +1.0 basis point
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 819.0 unch.
  
• Avg. Auto ABS OAS 63.0 +1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 40.0 -.17%
• 3-Month T-Bill Yield 5.39% -1.0 basis point
  

• China Iron Ore Spot 107.3 USD/Metric Tonne -1.8%
• Dutch TTF Nat Gas(European benchmark) 24.8 euros/megawatt-hour -.6%

• Citi US Economic Surprise Index 29.0 +2.5 points

• Citi Eurozone Economic Surprise Index 56.2 +1.5 points

• Citi Emerging Markets Economic Surprise Index 16.3 +1.5 points
• S&P 500 Current Quarter EPS Growth Rate YoY(496 of 500 reporting) +7.9% -.1 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 248.06 +.07:  Growth Rate +11.1% unch., P/E 20.8 +.2
  
• S&P 500 Current Year Estimated Profit Margin 12.82% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(10 of 10 reporting) +55.2% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 316.11 +.02: Growth Rate +31.6% unch., P/E 31.2 +.4
  
• Bloomberg US Financial Conditions Index .92 -9.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index 1.05 +1.0 basis point
  
• US Yield Curve -44.75 basis points (2s/10s) -1.0 basis point
  
• US Atlanta Fed 1Q GDPNow Forecast +2.5% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 61.0% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.78% +6.0 basis points: CPI YoY +3.33% +21.0 basis points
  
• 10-Year TIPS Spread 2.30 +3.0 basis points
  
• Highest target rate probability for May 1st FOMC meeting: 88.8%(+7.1 percentage points) chance of 5.25%-5.5%. Highest target rate probability for June 12th meeting: 62.2%(+2.6 percentage point) chance of 5.0%-5.25%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +93 open in Japan 
• China A50 Futures: Indicating -9 open in China

• DAX Futures: Indicating +31 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 some of my emerging market shorts
  

• Market Exposure: 100% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Value -.7%
  

Sector Underperformers:

• 1) Alt Energy -2.1% 2) Gold & Silver -1.8% 3) Airlines -1.7%

Stocks Falling on Unusual Volume: 

• BA, VALE, KSS, LEG, ASAN, ONON, LUV and ACAD
  

Stocks With Unusual Put Option Activity:

• 1) BEKE 2) LUV 3) ETRN 4) GFI 5) KGC
  

Stocks With Most Negative News Mentions:

• 1) LUV 2) AAL 3) NOVA 4) ONON 5) PLCE
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +1.2%
  

Sector Outperformers:

• 1) Software +2.3% 2) Electric Vehicles +1.8% 3) Computer Services +1.6%

Stocks Rising on Unusual Volume:

• BZ, EH, ORCL, ANAB, BEKE, SAVA, LI, GLNG, PAY, UVE, QFIN, FUTU, NAMS, PDD, VRT, RPAY, PAR, OPRA, HTHT, JD, KRYS, VIPS, GPS, EVER, EVER, SLN, NVDA, ZTO, CPNG, BROS, CRWD, ACIC, ADM, EWTX, HPE, YUMC, WING, ACIC, EWTX, DB, WST, BIDU, PLRX, TSM, CRTO, ATHM and PBR/A
  

Stocks With Unusual Call Option Activity:

• 1) REI 2) DGRO 3) GERN 4) NTES 5) ORCL

Stocks With Most Positive News Mentions:

• 1) ORCL 2) IBM 3) BZ 4) HRTG 5) PACK
  

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:

• (DLTR)/2.66
• (WOOF)/.02
• (WSM)/5.12
  

After the Close: 

• (LEN)/2.21
• (S)/-.04
• (SMTC)/-.04
• (PATH)/.16
  

Economic Releases

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +306,670 barrels versus a +1,367,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -1,619,830 barrels versus a -4,460,000 barrel decline the prior week. Distillate inventories are estimated to fall by -704,330 barrels versus a -4,131,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.85% versus a +3.4% gain prior.
  

Upcoming Splits 

• None of note
  

Other Potential Market Movers

• The 30Y T-Bond auction, weekly MBA Mortgage Applications report, Thomson Reuters IPSOS PCSI for March, BofA Consumer/Retail Conference, UBS Consumer/Retail Conference, (SBUX) general meeting, (ADI) general meeting, (SUM) investor day, (ACI) annual meeting, JPMorgan Industrials Conference, Barclays Healthcare Conference, Sidoti Small Cap Conference, Gabelli Specialty Chemical Symposium, Leerink Biopharma Conference and the Wolfe Fintech Forum could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +9.1% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 10.0 +.3
  
• 2 Sectors Declining, 9 Sectors Rising
• 55.8% of Issues Advancing, 41.3% Declining 
• TRIN/Arms 1.03 +53.7%
  
• Non-Block Money Flow +$79.9M
  
• 115 New 52-Week Highs, 20 New Lows
• 62.2% (+.7%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 71.0 +7.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 67.7 +4.3%
• Bloomberg Cyclicals/Defensives Pair Index 141.6 +.23%
  
• Russell 1000: Growth/Value 19,127.5 +1.4%
• CNN Fear & Greed Index 74.0 (Greed) +9.0
  
• 1-Day Vix 10.6 -44.6%
  
• Vix 14.1 -7.1%
  
• Total Put/Call 1.06 +1.9%

Tuesday Watch

Evening Headlines

Bloomberg:  

• World’s Last Negative Rate Experiment Nears Its End in Japan.
• Asia Stocks Look Mixed as US Inflation Data Looms.
• Oil Steadies Before OPEC Monthly Report and US Inflation Data.
• Biden’s $7.3 Trillion Budget Sets Up Tax Fight With Trump.
• Biden Seeks $8 Billion to Expand American Climate Corps Capital Gains Hikes at Center of Biden’s Second-Term Tax Agenda .
• Reddit Launches Long-Awaited IPO With $748 Million Target. 
• Bond Traders Eye Key Inflation Data to Plan Next Bets.
• Biden’s Budget Expects Cooling Economy, Stubborn Inflation. 
• Five Things You Need to Know to Start Your Day: Asia.
  

Zero Hedge:

• How Shadowy Network Of NGOs Supplies Mega-Corporations With Migrants To Exploit Cheap Labor.
• Black Missouri Teen Arrested After Footage Shows Her Brutally Beating White Girl Into A Seizure.
• Israel Making Preparations To Launch Invasion Of Southern Lebanon.
• Only The US Can Destroy The US Dollar.
• Zelensky Says 'Build The Wall': Ukraine Erecting 2,000km Of Fortifications On Front Lines.
• Over 80% Of Tattoo Inks Contain Unlisted Substances That Can Cause Organ Damages, Allergies: Study.
• Deadspin Fires All Employees As Part Of Liquidation Sale, Just Weeks After 'Blackface' Lawsuit.
• Red Candle In The Wind.
• Here's What's In Biden's 'Reckless' $7.3 Trillion Budget, And Here's How He'll 'Pay' For It.
• China Planted Mystery Devices On Cranes Used In US Ports, Could Seize Control Remotely: Congressional Letter.
• Transgender Golfer Booted After Woman's Pro Tour Adopts 'Biological At Birth' Rules.
• US stocks finished mostly lower amid a tentative mood ahead of US CPI - Newsquawk Asia-Pac Market Open.
• Fauci Deputy Warned Him Against Vaccine Mandates: Email.
• California Democrat Wants Taxpayer-Funded Lawyers For Illegals Convicted Of 'Serious And Violent Crimes'.
• Trump "Clearly Hasn't Learned From His COVID-Era Mistakes", RFK Jr. Says.
• Bring Out Your Dead: Mall Retailer 'The Body Shop' Files For Chapter 7 Bankruptcy.
• Nasdaq and Russell lag while bonds slide ahead of CPI; BTC pushes fresh highs - Newsquawk US Market Wrap. 
• The Anti-Democratic Democratic Left.
• Crypto Crack-Up Continues As Stocks & Bonds Sink Ahead Of CPI.

Wall Street Journal:

• Doctors Can Now Edit the Genes Inside Your Body.
• It Isn’t Just Big Tech Propelling Gains in Stock Market Anymore.
• More Americans Are Using Their 401(k)s as Cash Machines.
• Biden Offers a Budget Fantasy. His outline for fiscal 2025 supposes a world that doesn’t exist.
• Incident on Latam Flight Injures Dozens Aboard Boeing 787 Dreamliner.

CNBC.com:

• A key inflation reading is due out Tuesday morning. Here’s what to expect.
• TikTok creators look for other places to make money as threat of U.S. ban gains steam.
• JPMorgan’s Dimon urges US Fed to wait past June before cutting rates.
• Advance Auto Parts reaches deal with Dan Loeb’s Third Point, Saddle Point for three board seats.

Reuters:

• Tyson Foods to close Iowa pork plant with 1,200 workers.

MarketWatch.com:  

• Oracle’s stock is climbing, thanks to large new cloud deals, AI demand.
• Here’s how Apple could uniquely leverage AI — and send its sagging stock higher.
• Acadia Pharma’s stock falls 15% after failed drug trial.
• Nvidia’s stock could hit $1,200, this bull says. Here’s the key to that rally.

Newsmax:

• Liz Cheney, Jan. 6 Committee Hid Trump Evidence.
• House GOP Report Discredits Jan. 6 Panel's Star Witness.
• Jan. 6 Committee Can't Rewrite History.
• Poll: Majority of Israelis Claim Biden's Support Waning.

Fox News: 

• FBI director sounds alarm on wide array of 'very dangerous threats' coming from US border.
• FDNY union head weighs in after staff cheered Trump, booed NY AG Letitia James.

TheGatewayPundit.com:

• Dr. Peter Navarro Ordered to Report to Prison Next Week – First High Profile Trump Aide Imprisoned by Lawless Regime.
• Nearly 19 Million People Have Seen Elon Musk’s Warning: Democrats’ Census Scheme Has Changed the ‘Entire Balance of Power’.
• New Information on Liz Cheney’s Deceit and Perverse Actions Surrounding Events on Jan. 6 Raises Serious Calls for Her Arrest and Prosecution.
• Is This the Last Straw for Raffensperger? Evidence Confirms GA SOS Team Illegally Recorded Trump Call, Promoted a Fraudulent Transcript, Sent it to WaPo, Then Trashed the Audio – Now He’s Caught!
• Bloodbath: Huge Shakeup at RNC As Trump’s Team Prepares to Ax More Than 60 Staffers.
• Victor Reacts: Absolute Tragedy, Illegal Alien Kills 12-Year-Old Boy (VIDEO),
• JUST IN: Boeing Whistleblower Found Dead From “Self-Inflicted” Wound.
• KARMA: Woke Deadspin Sold to New Owners, Who Promptly Fire Company’s ENTIRE Staff – Outlet Defamed a Little Kansas City Chiefs Fan by Falsely Accusing Him of Wearing Blackface.
• “Am I Allowed to Take Any Questions? Anybody Here?” Biden’s Handlers Cut Feed as Campaign Event in New Hampshire Goes South (VIDEO).
• Illegal Alien from Venezuela Kills 12-Year-Old Missouri Boy After She Crossed Lanes and Hit a Missouri Family Head-On in Collision – Travis Wolfe Was Put on Life Support, He Never Woke Up.
• Joe Biden Says the Quiet Part Out Loud-Ceasefire in Gaza Would Allow Hamas to “Survive and Rebuild”(Video).
• 28-Year-Old Swedish Footballer Diagnosed With Multiple Small Blood Clots in Brain After Frightening Collapse, Under Intensive Care.

The Epoch Times:

• Chinese Espionage Quietly Penetrates Critical Infrastructure in the US.
• China Increases Defense Budget by 7.2 Percent, Sparking Concern.

X:

• @elonmusk 

• More Presidential and House of Representatives electoral votes will be assigned to the new illegals Biden has let in than the population of 40 US states. Let that sink in. (video)

• @StephenM

• On Friday, every single Senate Democrat — every single one — voted to give illegals representation in Congress AND the Electoral College. Tester, Brown, Ossoff, all of them. (list)
  

• @libsoftiktok
  

• Pittsburgh police will no longer respond to certain calls including theft, harassment, criminal mischief, and burglary alarms. Between 3AM-7AM there will be no officers at any police stations. Buy guns. Buy ammo. The police will not protect you. (video)

• @wideawake_media

• Leading advisor to the WEF, Yuval Noah Harari: "Covid is critical because this is what convinces people to accept total biometric surveillance", which will enable "the Stalins of the 21st century" to monitor and analyse "the brains of all the population, all the time". "You don't need human agents. You don't need human analysers. You just have a lot of sensors, and an AI which analyses it, and that's it, you have the worst totalitarian regime in history." (video)
• MUST-WATCH: Speaking in August 2020, before any of it had actually happened, RFK Jr. made these predictions about Fauci, Gates and the Covid "vaccine" roll-out, with ASTOUNDING accuracy. (video)
  

• @ShadowofEzra
  

• Laura Silsby, during her tenure with the Clintons, was apprehended in the act of trafficking children from Haiti to the Dominican Republic. Despite facing a crime punishable by life imprisonment, she was released by the Haitian Government after serving only six months. During her tenure as Secretary of State, Hillary Clinton employed significant efforts, such as utilizing former President Bill Clinton as a negotiator, to secure her release and return to the United States. (video)

• @VigilantFox

• Bad News for COVID Vaccine Manufacturers. If new bill passes, Americans would be able to SUE the COVID jab manufacturers directly. Rep. Chip Roy (R-Texas) on Tuesday introduced a bill that would allow Americans to sue the manufacturers of COVID-19 vaccines for vaccine-related adverse events, including deaths by removing the vaccine makers’ liability shield. (video)

• @charliekirk11

• The U.S. is in danger of a destructive war with China because we depend on Taiwan for so many of our strategically crucial computer chips. Congress recently passed a bill spending billions to construct chip factories in the U.S. But it turns out companies are scaling back their plans, because the bill is gummed up with so many DEI provisions and quotas that they don’t think it’s worth it. DEI is the enemy to American greatness.

• @WallStreetApes 

• 2016 Haitian Reporter "Where is the money Hillary Clinton raised with the Clinton foundation, Haiti did not get even 2%”. “The Whole World Has Given Billions” & They Accuse Bill Clinton & Hillary Clinton Of Stealing It. “So, mister Trump, we are asking you, begging you, the Haitian community will side with you if one day you ask Hillary Clinton publicly to disclose the audit of all the money they have stolen from Haiti in 2010 after the earthquake”. (video)
• The Illegal Immigrant Situation Is Far Worse Than People Realize In Denver Colorado. Journalist Travels To See For Herself After Being Given The Tip To Look At A Specific Home Depot “Venezuelan men are prostituting out their wives for $20 an hour. — They need money, they can't work, and they are basically just hanging out. (video)
  

• @BGatesIsaPsycho 

• “Young people (Pilots) that look just like me are dropping dead on flights”. Since the mRNA roll out - has been a dramatic increase in Pilot Deaths. In last 3 weeks 3 pilots alone in Canada have died. Is it because blood is even more susceptible to clotting at altitude? (video)
• 2030 Agenda & 15 Minute Cities. The 2030 goal is for total State Control of all Resource - this includes Farms. Once you understand the Global Government objectives all the small step change in legislation & MSM ‘nudging’ starts making sense. (video) 
• Bio Engineered Ingredients. This food status is appearing on more & more labels. Bio-Engineered ingredients is essentially any food engineered & genetically modification in a Lab. (video)

• @mazemoore
  

• Thirty five years ago Biden gave the response to one of George Bush's speeches. Republicans should have just played this and let Joe Biden respond to Biden's SOTU. (video)

• @Rasmussen_Poll

• Arizona 2020 Maricopa Forensic Ballot Audit - 2.1M ballots each examined by hand and high rez photographed front and back. 10%+ found to be non-conforming (counterfeit). Legacy media lies about it all, says they found nothing except some extra Biden votes.

• @MJTruthUltra

• Every Single American needs to Realize what is Happening to the United States… Ever since the 2020 election year, the quality of life for Americans, our safety, and common sense have all seen a sharp decline.. The Defund the Police movement wasn’t an ideology that magically came to fruition from George Floyd’s death (Overdose). It was the perfect catalyst to bring about what they’ve planned for for decades; to try and convince people to accept the very decisions that would ultimately destroy them.(video)

• @catsscareme2021

• I wish the quality was better but his words have been translated below- Paramedic James P. Hilton's question to John Abramson, MD, health care policy professor at Harvard Medical School, Executive Director of Health Management; Wells Fargo Health Solutions. Sponsored by Harvard Medical School and Massachusetts General Hospital. (video)

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 1,007,636 Reports(+4,460 from prior report) Through February 23rd, 2024.

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 +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 100.0 unch.

• China Sovereign CDS 66.0 -.25 basis point.
  
• China Iron Ore Spot 107.3 USD/Metric Tonne +.05%.

• Bloomberg Emerging Markets Currency Index 40.03 -.05%.
• Bloomberg Global Risk-On/Risk Off Index 65.7 +1.3%.
• Volatility Index(VIX) futures 15.8 -.4%.
• Euro Stoxx 50 futures +.36%

• S&P 500 futures +.29%.

• NASDAQ 100 futures +.50%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly lower, weighed down by industrial and healthcare 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.