Stocks Rising into Final Hour on US Economic Data, China Stimulus Hopes, US Port Strike Can-Kicking, Financial/Consumer Discretionary 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) 19.0 -7.5%
• DJIA Intraday % Swing .81 +23.0%
  
• Bloomberg Global Risk On/Risk Off Index 61.3 +9.1%

• Euro/Yen Carry Return Index 180.8 +.8%

• Emerging Markets Currency Volatility(VXY) 9.1 +1.0%

• CBOE S&P 500 Implied Correlation Index 18.3 -7.6% 

• ISE Sentiment Index 160.0 +14.0 points
  

• Total Put/Call .95 +10.5%

• NYSE Arms .66 -21.4%
  
• NYSE Non-Block Money Flow +$179.5M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 53.0 -1.9%
  

• US Energy High-Yield OAS 305.3 -6.3%
• Bloomberg TRACE # Distressed Bonds Traded 238 -11
  

• European Financial Sector CDS Index 65.9 -2.7%
  
• Deutsche Bank Subordinated 5Y Credit Default Swap 172.1 -2.2%
  

• Italian/German 10Y Yld Spread 130.0 basis points -3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 71.8 +1.2%
  

• Emerging Market CDS Index 163.7 -.72%
  
• Israel Sovereign CDS 165.7 +3.6%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 25.14 +.01%

• 2-Year SOFR Swap Spread -19.5 basis points +.5 basis point
  

• 3M T-Bill Treasury Repo Spread -19.75 basis points +14.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -7.75 +1.0 basis point
  
• MBS  5/10 Treasury Spread 135.0 +8.0 basis point
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 721.0 +4.0 basis points
  
• Avg. Auto ABS OAS 66.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 38.7 -.26%
• 3-Month T-Bill Yield 4.62% +4.0 basis points
  

• China Iron Ore Spot 109.0 USD/Metric Tonne +.3%
• Dutch TTF Nat Gas(European benchmark) 41.0 euros/megawatt-hour +2.7%

• Citi US Economic Surprise Index 14.1 +9.7 points
  

• Citi Eurozone Economic Surprise Index -29.5 +6.6 points

• Citi Emerging Markets Economic Surprise Index -3.4 -.2 point
• S&P 500 Current Quarter EPS Growth Rate YoY(22 of 500 reporting) +18.4% unch.
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 266.89 -.03:  Growth Rate +14.5% +.2 percentage point, P/E 21.5 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.66% unch.
  
• 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 365.22 +.20: Growth Rate +28.3% +.1 percentage point, P/E 31.1 +.1
  
• Bloomberg US Financial Conditions Index .70 -4.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .75 unch.
  
• US Yield Curve 5.25 basis point (2s/10s) -8.5 basis points
  
• US Atlanta Fed 3Q GDPNow Forecast +2.54% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 58.3 -.8 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.58% unch.: CPI YoY +2.25% unch.
  
• 10-Year TIPS Spread 2.24 +3.0 basis points
  
• Highest target rate probability for Dec. 18th FOMC meeting: 81.1%(+37.5 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Jan. 29th meeting: 72.2%(+33.4 percentage points) chance of 4.0%-4.25%. (current target rate is 4.75-5.0%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +1,105 open in Japan 
• China A50 Futures: Indicating +1,470 open in China

• DAX Futures: Indicating +208 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 75% Net Long
  

Bear Radar

Style Underperformer:

• Mid-Cap Value +.3%
  

Sector Underperformers:

• 1) Shipping -2.7% 2) Homebuilding -2.5% 3) Utilities -.7%

Stocks Falling on Unusual Volume: 

• WMG, LEN, SDA, AXSM, LGIH, AZEK, FND, RIVN, RKT, NMRK, NVAX and ZIM
  

Stocks With Unusual Put Option Activity:

• 1) TIGR 2) COHR 3) EVGO 4) RKT 5) JETS
  

Stocks With Most Negative News Mentions:

• 1) SAVE 2) SAGE 3) ZIM 4) RIVN 5) POWW
  

Sector ETFs With Most Negative Money Flow:

• 1) FXR 2) KRE 3) IGV 4) XLF 5) ITB

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +1.3%
  

Sector Outperformers:

• 1) Alt Energy +2.6% 2) Airlines +2.5% 3) Retail +2.3%

Stocks Rising on Unusual Volume:

• TIGR, EH, CAPR, OKLO, ACMR, JKS, BYON, B, NFE, NNE, HNRG, NGVT, HNRG, TVTX, SILV, SMR, BYRN, WB, MNSO, ANF, GCT, DQ, MMYT, CLMT, AAOI, ENVX, YMM, MSTR, ALB, TARS, ALAB, TCOM, AAL, ESTA, MARA, RDDT, BGNE, KGS, UPST, PAL and NBR
  

Stocks With Unusual Call Option Activity:

• 1) EVGO 2) EH 3) SAVE 4) BLUE 5) BLNK

Stocks With Most Positive News Mentions:

• 1) PEV 2) ANF 3) B 4) EVGO 5) APOG
  

Sector ETFs With Most Positive Money Flow:

• 1) SMH 2) KWEB 3) XLY 4) XLE 5) XBI
  

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:

• None of note
  

After the Close: 

• None of note
  

Economic Releases

3:00 pm EST

• Consumer Credit for Aug. is estimated to fall to $12.0B versus $25.45B in July.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Musalem speaking, Fed's Bowman speaking, Fed's Bostic speaking, Fed's Kashkari speaking, Conference Board Employment Trends Index for Sept., Global Gaming Expo and the Embedded World Conference could also impact global trading on Monday.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +.7% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 11.3 -2.0
  
• 5 Sectors Declining, 6 Sectors Rising
• 59.9% of Issues Advancing, 38.4% Declining 
• TRIN/Arms .82 -2.4%
  
• Non-Block Money Flow +$218.6M
  
• 142 New 52-Week Highs, 9 New Lows
• 58.9% (+2.1%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 66.0 +9.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 61.2 +8.5%
• Bloomberg Cyclicals/Defensives Index 230.5 +1.2%
  
• Russell 1000: Growth/Value 19,727.7 +.18%
• CNN Fear & Greed Index 73.0 (GREED) +6.0
  
• 1-Day Vix 13.9 -27.5%
  
• Vix 19.1 -6.7%
  
• Total Put/Call .94 +9.3%

Friday Watch

Night Trading 

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 71.5 +.5 basis point.

• China Sovereign CDS 62.5 +2.25 basis points.
  
• China Iron Ore Spot 108.4 USD/Metric Tonne -.6%

• Bloomberg Emerging Markets Currency Index 38.8 -.2%.
• Bloomberg Global Risk-On/Risk Off Index 58.5 +4.1%.
• Volatility Index(VIX) futures 19.8 -.8%.
• Euro Stoxx 50 futures +.24%.

• S&P 500 futures +.13%.

• NASDAQ 100 futures +.23%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by financial and technology shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 50% net long heading into the day.