Stocks Rising into Final Hour on Trump Poll Surge, Lower Long-Term Rates, Earnings Outlook Optimism, Financial/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Around Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 13.1 -.3%
• DJIA Intraday % Swing 1.46 +171.9%
  
• Bloomberg Global Risk On/Risk Off Index 57.0 -.7%

• Euro/Yen Carry Return Index 189.6 +.24%

• Emerging Markets Currency Volatility(VXY) 7.07 -.7%

• CBOE S&P 500 Implied Correlation Index 9.11 +5.3% 

• ISE Sentiment Index 150.0 -8.0
  

• Total Put/Call .81 -4.7%

• NYSE Arms .90 -10.0%
  
• NYSE Non-Block Money Flow +$397.0M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 48.3 -.4%
  

• US Energy High-Yield OAS 266.5 -.7%
• Bloomberg TRACE # Distressed Bonds Traded 273 +3
  

• European Financial Sector CDS Index 59.3 +1.7%
  
• Deutsche Bank Subordinated 5Y Credit Default Swap 150.8 +.74%
  

• Italian/German 10Y Yld Spread 127.0 basis points -3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 93.0 +1.9%
  

• Emerging Market CDS Index 159.4 +.17%
  
• Israel Sovereign CDS 133.13 -.5%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.9 -.12%

• 2-Year SOFR Swap Spread -17.75 basis points -.75 basis point
  

• Treasury Repo 3M T-Bill Spread 0.0 basis points -1.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -1.25 +.75 basis point
  
• MBS  5/10 Treasury Spread 142.0 +4.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 705.0 -18.0 basis points
  
• Avg. Auto ABS OAS 62.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 39.3 -.04%
• 3-Month T-Bill Yield 5.33% unch.
  

• China Iron Ore Spot 107.9 USD/Metric Tonne +.5%
• Dutch TTF Nat Gas(European benchmark) 32.8 euros/megawatt-hour +4.6%

• Citi US Economic Surprise Index -42.7 +2.8 points

• Citi Eurozone Economic Surprise Index -25.2 +.2 point

• Citi Emerging Markets Economic Surprise Index 5.0 +.2 point
• S&P 500 Current Quarter EPS Growth Rate YoY(35 of 500 reporting) +12.2% -.7 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 261.67 +.17:  Growth Rate +14.6% +.1 percentage point, P/E 21.6 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.82% +1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 332.48 +.20: Growth Rate +23.9% unch., P/E 35.6 -.4
  
• Bloomberg US Financial Conditions Index 1.01 -1.0 basis point
  
• Bloomberg Euro-Zone Financial Conditions Index .92 +2.0 basis points
  
• US Yield Curve -27.5 basis points (2s/10s) -5.0 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +2.02% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 61.2% +.1 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.39% unch.: CPI YoY +3.01% unch.
  
• 10-Year TIPS Spread 2.27 -1.0 basis point
  
• Highest target rate probability for Sept. 18th FOMC meeting: 93.3%(+1.4 percentage points) chance of 5.0%-5.25%. Highest target rate probability for Nov. 7th meeting: 62.2%(+.5 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +260 open in Japan 
• China A50 Futures: Indicating -56 open in China

• DAX Futures: Indicating +197 open in Germany

Portfolio:

• Higher:  On gains in my industrial/biotech/financial/consumer discretionary sector longs
  

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

• Market Exposure: Moved to 100% Net Long
  

Bull Radar

Style Outperformer:

• Small-Cap Value +3.2%
  

Sector Outperformers:

• 1) Homebuiding +6.0% 2) Regional Banks +4.0% 3) Healthcare Providers +3.9%

Stocks Rising on Unusual Volume:

• LPA, GRAL, SLDB, HMY, AAOI, SEDG, EVH, DRD, ESTA, SAVA, ML, VRDN, CLSK, CRSP, NX, RIOT, MTCH, AX, SHOP, DAVE, LMND, STT, SPIR, GFI, BZH, NBR, UNH, DAL, CFB, APEI, BAC, IMMR, RKT, CCS, GOLD, KELYA, PNC, MATV, AMSC, IMXI, SFNC, BGNE, OSBC, NBBK, RVTY, MRC, MBIN, DAKT, TOWN, EBC, HOMB, ARR, UPST, FLR and KEX
  

Stocks With Unusual Call Option Activity:

• 1) CRTO 2) XLI 3) SLS 4) BSX 5) XHB

Stocks With Most Positive News Mentions:

• 1) ANGO 2) BTAI 3) UNH 4) SHOP 5) MTCH
  

Sector ETFs With Most Positive Money Flow:

• 1) XLF 2) VGT 3) XLI 4) SMH 5) XLU
  

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:

• (ALLY)/.64
• (ASML)/4.04
• (CFG)/.78
• (ELV)/10.00
• (FHN)/.30
• (JNJ)/2.71
• (NTRS)/1.75
• (PLD)/1.33
• (USB)/.95
  

After the Close: 

• (AA)/.08
• (OZK)/1.52
• (CCI)/1.67
• (DFS)/3.08
• (KMI)/.26
• (SLG)/1.59
• (STLD)/2.73
• (UAL)/3.94
• (LVS)/.59
  

Economic Releases

8:30 am EST

• Building Permits for June is estimated to rise to 1400K versus 1399K in May.
• Housing Starts for June is estimated to rise to 1300K versus 1277K in May. 
  

9:15 am EST

• Industrial Production MoM for June is estimated to rise +.3% versus a +.7% gain in May.
• Manufacturing Production for June is estimated to rise +.1% versus a +.9% gain in May.
• Capacity Utilization for June is estimated to fall to 78.4% versus 78.2% in May.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -736,000 barrels versus a -3,443,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -1,446,000 barrels versus a -2,006,000 barrel decline the prior week. Distillate inventories are estimated to rise by +440,000 barrels versus a +4,884,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.72% versus a +1.9% gain prior.
  

2:00 pm EST

• Fed releases Beige Book report.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Barkin speaking, Fed's Waller speaking, 20Y Bond auction, Atlanta Fed GDPNow 2Q update, weekly MBA Mortgage Applications report and the (STZ) general meeting could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Tuesday Watch

Evening Headlines

Bloomberg:

• Bold and Bloodied Trump Seizes the Moment After Being Shot.
• Rio Tinto’s Iron Ore Output Rises, Copper Production Jumps.
• Asia Eyes Cautious Open; US Stocks Buoyed by Trump.
• Oil Steadies as Traders Look to Dollar and China for Next Cues.
• Stocks Up as Trump Picks VP in Generational Shift.
• Fed's Powell Says Recent Data Raise Confidence Inflation on Path to 2%.
• Silicon Valley’s Trump Backers Cheer Vance as VP Pick. 
• Five Things You Need to Know to Start Your Day: Asia.

Zerohedge:  

• Trump Picks J.D. Vance As Running Mate.
• "Ordered My First MAGA Hat": Closet Trump Supporters Are Coming Out Of Woodwork After Failed Assassination Attempt.
• Tverberg: Advanced Economies Are Headed For A Downfall.
• Taliban Takes Americans Hostage, Says Willing To Trade For Gitmo Prisoners.
• "It's Not A 'Narrative', It's The Truth" - David Sacks Destroys WaPo's Post-Trump-Shooting Spin.
• GOP Was Investigating Secret Service Before Assassination Attempt.
• US stocks finished higher in choppy trade as markets reflected on the Trump assassination attempt and Powell's comments - Newsquawk Asia-Pac Market Open.
• Zelensky Suddenly Reverses, Says Russia Should Attend 2nd Ukraine Summit.
• Don’t Expect Home Prices To Go Down Anytime Soon, Say Experts.
• Markets chop to Trump assassination attempt and dovish Powell - Newsquawk US Market Wrap.
• Shocks To The System.
• "It's Staggering!" - AI's Rapid Growth Threatens Energy Industry, Economy, & Climate.
• Trump'd: Gold & Crypto Soar, Yield-Curve Dis-Inverts As Small-Caps Crush Big-Tech Again.

Wall Street Journal:

• Choice seen as helping GOP in Midwest battleground states.
• Five Things to Know About J.D. Vance.
• Mystery Around Trump Shooter Deepens.
• Trump Shooting Is Stunning Failure for Secret Service.
• Big Banks Helped by Wall Street Comeback.
• Evictions Surge in Major Cities in the American Sunbelt.
• Rest of World Watches U.S. Turmoil With Growing Alarm.
• Fed Up With Their Car-Insurance Bills, Drivers Shift Gears.
• Trillions in Hidden Debt Drove China’s Growth. Now It Threatens Its Future.

CNBC.com:

• Powell indicates Fed won’t wait until inflation is down to 2% to cut rates.
• Apple releases iOS 18 public beta for iPhone — Here’s what’s new and how to get it.
• GM’s 2025 EV production capacity target in doubt after Barra comments.
• Here are your best money moves as a Federal Reserve rate cut looks more likely.
• How AI and automation will reshape grocery stores and fast-food chains.

MarketWatch.com: 

• Trump picks J.D. Vance as his running mate, adding venture-capital experience to GOP ticket.
• Back-to-school shopping expected to cost families $875 on average — as much as holiday spending.
• Nearly a third of home sellers are cutting prices as housing supply balloons in these areas.
• How Apple’s stock can reach $300, according to Wall Street’s new biggest bull.

Fox News:

• Kamala Harris says she's 'prepared to debate' JD Vance, has 'accepted' proposal.
• Vance has a Netflix movie about his life.
• Trump pick JD Vance celebrated by GOP: 'Opponent of endless wars'.
• Biden addresses 'bullseye' comment made before Trump assassination attempt.

TheGatewayPundit.com:

• “You Couldn’t Wait With Your Lies…Get Outta Here!” – Don Jr. Smacks Down ‘Clown’ MSNBC Reporter for Smearing His Dad After He was Nearly Killed (VIDEO).
• WAYNE ROOT: My Trump VP Pick was JD Vance. Why Did I pick him? How Did I know? Here’s What Makes JD the Perfect Pick to Score a Landslide Victory.
• Mitch McConnell Loudly Booed at RNC Convention (VIDEO).
• “USA! USA! USA!” – Crowd Goes Wild as GOP Officially Nominates Trump as Its Presidential Nominee (VIDEO).
• RFK Jr. Finally Granted Secret Service Following Trump Assassination Attempt and Pressure From Trump.
• WATCH: Chaos in Copa America’s Final Match as Police and Security Struggle To Contain a Mass of People Without Tickets From Entering Hard Rock Stadium in Miami.
• J6 Political Prisoner Barry Ramey’s Family Pleads For Assistance From The American Public After The Biden Regime Destroyed Their Lives.
• Democrat Rep. Bennie Thompson Gets Humilating Community Notes Attached to Post on X.
• Trump Confirms a Chunk of His Right Ear is Gone During Assassination Attempt.
• UPDATE: BlackRock Pulls Ad Featuring Trump Shooter Thomas Matthew Crooks.
• Angry Euro-Globalists Move to Boycott Orbán’s EU Presidency, Are Desperate To Crush His Peace Initiative.

The Epoch Times:

• China’s Banking Sector Faces Reckoning.
• China Kicks Off Major Political Meeting Amid Gloomy Economic Data.

Around X:

• @TestDummy04

• What exactly is going on here? Things are NOT adding up! (video)

• @BillboardChris

• Attendees knew he was on the roof. Police knew he was on the roof. Secret Service knew he was on the roof. They knew he had a rifle. And they waited for him to shoot. They didn’t even bother to remove Trump from the stage. What do you call this? (video)

• Squawk55

• Former Green Baret/Special Forces sniper chimes in ... (video)
  

• @Liz_churchill10

• “I spent 14 years as a Sniper…and yesterday what happened…I have no doubt in my mind…that the Shooter had help from somewhere within an Agency, Organization or the Government. The second I saw the photo of what they said happened…made no sense to me…” (video)

• @OX_DAO

• I used to work in military intelligence. My take on the Trump assassination attempt today: The guilty parties are definitely (1) the counter-sniper(s) and spotter(s) assigned to cover these specific rooftops and (2) the team leader responsible for all event pre-planning and assigning lines of sight. There is a 0% chance that a standard sniper-spotter team tasked with covering such a critical direct LOS rooftop did not spot a man crawling for over two minutes on an exposed rooftop with a rifle. The shooter's approach was amateurish; it wouldn't even pass basic training. He was fully exposed, easily visible to the public, on a critical rooftop, and extremely slow. (video)

• @LauraLoomer

• MUST WATCH NEW FOOTAGE OF ATTEMPTED TRUMP ASSASSINATION PROVES POLICE ALLOWED TRUMP TO STAY ON STAGE AND KEEP TALKING FOR NEARLY A MINUTE EVEN WITH ACTIVE KNOWLEDGE OF A MAN ON THE ROOF WITH A RIFLE. (video)

• @CollinRugg
  

• NEW: NBC News reports that the roof where the would-be assa*in shot from was a “well known high priority vulnerability.” The counter sn*per reportedly did *not* need approval to fire. “That the roof where the [suspect] was located was a well-known high priority vulnerability.” “It was identified just the day before during a security walkthrough.” “We've also just learned that there were two counter sn*per teams on site, and that the counter sn*per did not need approval to shoot one source telling NBC news that prior protocols were not followed.” (video)

• @WallStreetApes

• Candace Owens: The Assassination Was An Inside Job. “You have got to be kidding. Let me say something right now. Take this to the bank. Okay, That person was allowed to scale that roof. Okay, I am not some individual who's trying to assess the situation and never been around the president okay, While Trump was in office, okay, I was around him a lot a lot. And let me tell you something. (video)
• WOAH Listen To This: Secret Service Director Kim Cheatle “She has close ties to the Cheneys, the Bidens and is responsible for the J6 deleted texts scandal”. She “evacuated vice president Dick Cheney on 9/11”. (video)

OpenVAERS:

• VAERS US COVID Vaccine Adverse Event Reports. 1,012,894 Reports(+1,222 from prior report) Through June 28th, 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 91.25 +.25 basis point.

• China Sovereign CDS 58.25 +2.5 basis points.
  
• China Iron Ore Spot 107.9 USD/Metric Tonne -.9%.

• Bloomberg Emerging Markets Currency Index 39.3 unch.
• Bloomberg Global Risk-On/Risk Off Index 59.6 +3.9%.
• Volatility Index(VIX) futures 14.3 +.22%.
• Euro Stoxx 50 futures -.26%.

• S&P 500 futures +.16%.

• NASDAQ 100 futures +.26%.  

Morning Preview Links

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

Stocks Modestly Higher into Close on Trump Poll Surge, Earnings Outlook Optimism, Short-Covering, Financial/Energy Sector Strength

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 39.3 -.18%
• 3-Month T-Bill Yield 5.33% -1.0 basis point
  

• China Iron Ore Spot 107.6 USD/Metric Tonne -1.2%
• Dutch TTF Nat Gas(European benchmark) 31.4 euros/megawatt-hour -1.1%

• Citi US Economic Surprise Index -45.5 +2.0 points

• Citi Eurozone Economic Surprise Index -25.4 +.5 point

• Citi Emerging Markets Economic Surprise Index 4.8 -6.0 points
• S&P 500 Current Quarter EPS Growth Rate YoY(28 of 500 reporting) +12.9% +4.1 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 261.50 +.24:  Growth Rate +14.5% +.1 percentage point, P/E 21.6 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.81% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 332.28 +.47: Growth Rate +23.9% +.2 percentage point, P/E 36.0 +.2
  
• Bloomberg US Financial Conditions Index 1.02 +4.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .90 +8.0 basis points
  
• US Yield Curve -22.5 basis points (2s/10s) +5.0 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +2.02% +2.0 basis points
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 61.1% +.8 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.39% unch.: CPI YoY +3.01% unch.
  
• 10-Year TIPS Spread 2.28 +4.0 basis points
  
• Highest target rate probability for Sept. 18th FOMC meeting: 89.4%(-.9 percentage point) chance of 5.0%-5.25%. Highest target rate probability for Nov. 7th meeting: 61.0%(+4.7 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +30 open in Japan 
• China A50 Futures: Indicating -110 open in China

• DAX Futures: Indicating +138 open in Germany

Portfolio:

• Higher:  On gains in my industrial/tech/biotech/financial sector longs
  

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  

• Market Exposure: Moved to 75% Net Long
  

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

Earnings of Note 
Company/Estimate 

Before the Open:

• (ANGO)/-.17
• (BAC)/.80
• (MS)/1.65
• (PNC)/2.99
• (PGR)/2.04
• (STT)/2.03
• (UNH)/6.66
  

After the Close: 

• (IBKR)/1.74
• (JBHT)/1.49
• (OMC)/1.95
• (PNFP)/1.61
• (SCHW)/.72
  

Economic Releases

8:30 am EST

• NY Fed Services Business Activity Index.
• Retail Sales Advance MoM for June is estimated to fall -.3% versus a +.1% gain in May.
• Retail Sales Ex Autos MoM for June is estimated to rise +.1% versus a -.1% decline in May.
• Retail Sales Ex Autos and Gas MoM for June is estimated to rise +.2% versus a +.1% gain in May.
• The Import Price Index MoM for June is estimated to fall -.2% versus a -.4% decline in May.
• The Export Price Index MoM for June is estimated to fall -.1% versus a -.6% decline in May.
  

10:00 am EST

• Business Inventories for May is estimated to rise +.5% versus a +.3% gain in April.
• The NAHB Housing Market Index for July is estimated at 43 versus 43 in June.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Kugler speaking, Atlanta Fed GDPNow Q2 update, weekly US retail sales reports, weekly API crude oil stock report, (SCHW) business update and the (ADSK) annual meeting could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST