Afternoon Market Internals

NYSE Composite Index:

• Volume Running -6.1% Below 100-Day Average 
• Nasdaq/NYSE Volume Ratio 11.0 -.4
  
• 8 Sectors Declining, 3 Sectors Rising
• 27.0% of Issues Advancing, 70.3% Declining 
• TRIN/Arms 1.15 -7.3%
  
• Non-Block Money Flow +$5.9M
  
• 183 New 52-Week Highs, 15 New Lows
• 58.5% (-2.6%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 62.0 -5.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 55.5 +2.3%
• Bloomberg Cyclicals/Defensives Index 226.4 -.65%
  
• Russell 1000: Growth/Value 20,012.3 +1.21%
• CNN Fear & Greed Index 67.0 (GREED) +1.0
  
• 1-Day Vix 9.0 +4.7%
  
• Vix 18.2 +.8%
  
• Total Put/Call .70 -21.4%

Wednesday Watch

Night Trading 

• Asian equity indices are +.75% to +1.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 70.5 -.75 basis point.

• China Sovereign CDS 60.75 -1.5 basis points.
  
• China Iron Ore Spot 97.9 USD/Metric Tonne +3.3%

• Bloomberg Emerging Markets Currency Index 39.1 +.05%.
• Bloomberg Global Risk-On/Risk Off Index 55.9 +3.1%.
• Volatility Index(VIX) futures 18.2 +.8%.
• Euro Stoxx 50 futures -.16.

• S&P 500 futures -.14%.

• NASDAQ 100 futures -.16%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity and technology shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the day.

Stocks Modestly Higher into Final Hour on China Stimulus Hopes, Fed Rate-Cut Optimism, Short-Covering, Transport/Commodity Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Mixed
  

• Volume: Around Average
  

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 15.6 -1.6%
• DJIA Intraday % Swing .79 n/a
  
• Bloomberg Global Risk On/Risk Off Index 54.4 -.3%

• Euro/Yen Carry Return Index 176.9 +.33%

• Emerging Markets Currency Volatility(VXY) 8.60 unch.

• CBOE S&P 500 Implied Correlation Index 16.7 -2.8% 

• ISE Sentiment Index 163.0 +13.0 points
  

• Total Put/Call .85 unch.

• NYSE Arms .81 -14.7%
  
• NYSE Non-Block Money Flow -$1.6M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 52.7 -.5%
  

• US Energy High-Yield OAS 327.0 +.28%
• Bloomberg TRACE # Distressed Bonds Traded 251 +18
  

• European Financial Sector CDS Index 67.2 +.6%
  
• Deutsche Bank Subordinated 5Y Credit Default Swap 179.7 -.11%
  

• Italian/German 10Y Yld Spread 133.0 basis points -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 70.7 -.6%
  

• Emerging Market CDS Index 164.6 -1.2%
  
• Israel Sovereign CDS 158.2 +3.0%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 25.0 +.22%

• 2-Year SOFR Swap Spread -21.25 basis points -.5 basis point
  

• 3M T-Bill Treasury Repo Spread -20.25 basis points +.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -1.25 unch.
  
• MBS  5/10 Treasury Spread 125.0 -2.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 709.0 -1.0 basis point
  
• Avg. Auto ABS OAS 66.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 39.0 +.33%
• 3-Month T-Bill Yield 4.62% unch.
  

• China Iron Ore Spot 96.4 USD/Metric Tonne +1.8%
• Dutch TTF Nat Gas(European benchmark) 35.4 euros/megawatt-hour -2.2%

• Citi US Economic Surprise Index -13.8 -4.2 points
  

• Citi Eurozone Economic Surprise Index -58.0 -1.8 points

• Citi Emerging Markets Economic Surprise Index -7.8 -.1 point
• S&P 500 Current Quarter EPS Growth Rate YoY(8 of 500 reporting) +4.9% -.7 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 266.59 -.28:  Growth Rate +14.1% -.2 percentage point, P/E 21.5 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.67% +1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 363.57 +12.49: Growth Rate +27.7% +4.4 percentage points, P/E 31.6 -1.0
  
• Bloomberg US Financial Conditions Index .70 +6.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .69 -1.0 basis point
  
• US Yield Curve 19.5 basis point (2s/10s) +3.5 basis points
  
• US Atlanta Fed 3Q GDPNow Forecast +2.93% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 62.9% -1.4 percentage points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.77% unch.: CPI YoY +2.25% -2.0 basis points
  
• 10-Year TIPS Spread 2.18 +1.0 basis point
  
• Highest target rate probability for Dec. 18th FOMC meeting: 48.9%(-1.1 percentage points) chance of 4.0%-4.25%. Highest target rate probability for Jan. 29th meeting: 38.9%(+3.7 percentage points) chance of 3.5%-3.75%. (current target rate is 4.75-5.0%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -40 open in Japan 
• China A50 Futures: Indicating +355 open in China

• DAX Futures: Indicating +170 open in Germany

Portfolio:

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

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Bear Radar

Style Underperformer:

• Large-Cap Value unch.
  

Sector Underperformers:

• 1) Regional Banks -1.4% 2) Homebuilding -.9% 3) Gambling -.9%

Stocks Falling on Unusual Volume: 

• AIR, MCK, ITOS, SIRI, RCKT, BRZE, REGN, GPN, BFH and LNW
  

Stocks With Unusual Put Option Activity:

• 1) SATS 2) YINN 3) AR 4) KWEB 5) DFS
  

Stocks With Most Negative News Mentions:

• 1) V 2) PVH 3) PDD 4) THO 5) EXTR
  

Sector ETFs With Most Negative Money Flow:

• 1) XLI 2) XRT 3) PSI 4) ARKK 5) SIXG

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.5%
  

Sector Outperformers:

• 1) Electric Vehicles +4.6% 2) Steel +3.6% 3) Social Media +3.2%

Stocks Rising on Unusual Volume:

• LBRDK, BZ, AAOI, TME, BILI, MP, EH, JD, FUTU, LI, PDD, METC, XPEV, DQ, BYRN, SOC, HTHT, SMMT, ZK, HCC, SMR, EDU, AA, FCX, GATO, SCCO, YUMC, NTES, LLYVK, BABA, BEKE, TCOM, KSPI, GOGL, VALE, VIPS, THO, ERO, SMAR, AMR, PAAS, CEIX, BIDU, MAG, ZTO, LVS, LB, ARCH, ZIM, EL, JKS, CLF, BTU, SGML, BNTX, MT, QFIN, LEU, BHP, CENX, ASTL, IGMS, GPCR, VIST, GOOS, RIO, CDMO, KSS, DIN, WYNN, PRM, NVDA, HRTG, SQM, RVMD, CNH, KYMR, PSLV, TS, VITL, TECK, CAT, SPOT, EHC and ARIS
  

Stocks With Unusual Call Option Activity:

• 1) TME 2) MP 3) POET 4) YANG 5) BBIO

Stocks With Most Positive News Mentions:

• 1) HCP 2) MSCI 3) CMG 4) CAT 5) AZO
  

Sector ETFs With Most Positive Money Flow:

• 1) XLE 2) XBI 3) XLF 4) KRE 5) XLV
  

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:

• (CTAS)/1.0

After the Close: 

• (CNXC)/2.93
• (FUL)/1.23
• (JEF)/.78
• (MU)/1.11
• (WS)/.55
  

Economic Releases

10:00 am EST

• New Home Sales for Aug. is estimated to fall to 700K versus 739K in July.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory decline of -937,860 barrels versus a -1,630,000 barrel decline the prior week. Gasoline supplies is estimated to fall by -118,140 barrels versus a +69,000 barrel gain the prior week. Distillate inventories is estimated to fall by -1,217,430 barrels versus a +125,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to fall by -.24% versus a -.7% decline prior.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Krugler speaking, 5Y T-Note auction, weekly MBA Mortgage Applications report, (META) Connect 2024, (KFY) annual meeting, RBC Communications Infra Conference and the BofA Financials CEO Conference could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST