Wednesday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 73.25 +1.5 basis points.

• China Sovereign CDS 64.75 +.5 basis point.
  
• China Iron Ore Spot 101.4 USD/Metric Tonne +.8%

• Bloomberg Emerging Markets Currency Index 38.4 -.02%.
• Bloomberg Global Risk-On/Risk Off Index 62.6 +.9%.
• Volatility Index(VIX) futures 18.5 +.9%.
• Euro Stoxx 50 futures -.14%.

• S&P 500 futures -.15%.

• NASDAQ 100 futures -.22%.  

Morning Preview Links

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

Stocks Reversing Slightly Higher into Final Hour on Stable Long-Term Rates, Earnings Outlook Optimism, Technical Buying, Financial/Alt Energy Sector Strength

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 38.4 +.07%
• 3-Month T-Bill Yield 4.62% -1.0 basis point
  

• China Iron Ore Spot 101.6 USD/Metric Tonne +.98%
• Dutch TTF Nat Gas(European benchmark) 40.70 euros/megawatt-hour +1.7%

• Citi US Economic Surprise Index 17.2 +.8 point
  

• Citi Eurozone Economic Surprise Index -9.9 +1.1 points

• Citi Emerging Markets Economic Surprise Index -1.1 -.2 point
• S&P 500 Current Quarter EPS Growth Rate YoY(98 of 500 reporting) +5.1% -1.6 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 267.78 -.02:  Growth Rate +14.8% unch., P/E 21.8 -.1
  
• S&P 500 Current Year Estimated Profit Margin 12.63% -1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(1 of 10 reporting) +40.2% n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 369.61 +.24: Growth Rate +29.8% +.1 percentage point, P/E 32.2 +.1
  
• Bloomberg US Financial Conditions Index .92 +1.0 basis point
  
• Bloomberg Euro-Zone Financial Conditions Index .96 +17.0 basis points
  
• US Yield Curve 16.5 basis point (2s/10s) +1.0 basis point
  
• US Atlanta Fed 3Q GDPNow Forecast +3.43% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 46.8 -2.7 percentage points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.62% unch.: CPI YoY +2.57% unch.
  
• 10-Year TIPS Spread 2.34 +2.0 basis points
  
• Highest target rate probability for Dec. 18th FOMC meeting: 68.3%(+3.4 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Jan. 29th meeting: 46.7%(+2.3 percentage points) chance of 4.0%-4.25%. (current target rate is 4.75-5.0%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +54 open in Japan 
• China A50 Futures: Indicating +65 open in China

• DAX Futures: Indicating +155 open in Germany

Portfolio:

• Slightly Higher:  On gains in my biotech/utility sector longs and index hedges
  

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

• Market Exposure: Moved to 100% Net Long
  

Bear Radar

Style Underperformer:

• Mid-Cap Value -.4%
  

Sector Underperformers:

• 1) Homebuilding -3.4% 2) Computer Hardware -2.3% 3) Steel -1.9%

Stocks Falling on Unusual Volume: 

• CLSK, SHW, KMB, CRL, ASPN, WRB, VZ, SSD, ELF, MHK, NUE, PCAR, NRDS, EH, CR, PHM, LMT, SMR, IPG, DFH, OKLO, MEDP, PSTG, LOGI, TGLS, PII, GE, NNE and GPC
  

Stocks With Unusual Put Option Activity:

• 1) NXE 2) KVUE 3) SAVE 4) NKLA 5) KBE
  

Stocks With Most Negative News Mentions:

• 1) GPC 2) GE 3) PII 4) TGLS 5) MEDP
  

Sector ETFs With Most Negative Money Flow:

• 1) XLF 2) KRE 3) XLP 4) XLE 5) OIH

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.3%
  

Sector Outperformers:

• 1) Gold & Silver +1.8% 2) Software +1.4% 3) Alt Energy +1.3%

Stocks Rising on Unusual Volume:

• IRTC, HRI, MLI, IGMS, SDA, GM, PM, GRND, DJT, DGX, DQ, ALTR, ZION, ZBIO, CRMD, NSC, CSTM, SA, CORZ, JKS, BANC, CADE, SOC, TAL, GATO, PAAS, LEGN, MUX, PDD, URI, COGT, WOLF, ENVA and LH
  

Stocks With Unusual Call Option Activity:

• 1) SGMO 2) FTI 3) IVZ 4) GE 5) MMM

Stocks With Most Positive News Mentions:

• 1) PM 2) MLI 3) HRI 4) DJT 5) NSC
  

Sector ETFs With Most Positive Money Flow:

• 1) XLB 2) IGV 3) XBI 4) SMH 5) XLI
  

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:

• (T)/.57
• (BA)/-10.35
• (CME)/2.65
• (KO)/.75
• (GEV)/.17
• (GD)/3.48
• (HLT)/1.84
• (COOP)/2.57
• (NEE)/1.00
• (ODFL)/1.42
• (SF)/1.60
• (TMO)/5.24
• (VRT)/.69

After the Close: 

• (ALGN)/2.31
• (CP)/1.01
• (CLS)/.93
• (GGG)/.76
• (IBM)/2.22
• (KNX)/.32
• (LRCX)/.81
• (LVS)/.53
• (MOH)/5.94
• (NEM)/.87
• (OII)/.43
• (ORLY)/11.53
• (RJF)/2.41
• (NOW)/3.45
• (TER)/.78
• (TSLA)/.60
• (URI)/12.56
• (WHR)/3.20
• (WH)/1.38
• (BSX)/.59
• (FWRD)/-.17
• (SAVE)/-2.30
• (WFRD)/1.67
  

Economic Releases

10:00 am EST

• Existing Home Sales for Sept. is estimated to rise to 3.89M versus 3.86M in Aug.
  

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +728,670 barrels versus a -2,191,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -1,597,830 barrels versus a -2,201,000 barrel decline the prior week. Distillate inventories are estimated to fall by -2,079,330 barrels versus a -3,534,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to fall by -.33% versus a +1.0% gain prior.
  

2:00 pm EST

• Federal Reserve Beige Book release.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Bowman speaking, Fed's Barkin speaking, 20Y T-Note auction, IMF meetings, weekly MBA Mortgage Applications report and the (PH) annual meeting 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 -6.0% Below 100-Day Average 
• Nasdaq/NYSE Volume Ratio 15.8 +.7
  
• 7 Sectors Declining, 4 Sectors Rising
• 37.5% of Issues Advancing, 60.0% Declining 
• TRIN/Arms .59 -40.4%
  
• Non-Block Money Flow -$271.6M
  
• 60 New 52-Week Highs, 28 New Lows
• 59.2% (-.5%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 66.0 -1.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 61.9 -.9%
• Bloomberg Cyclicals/Defensives Index 230.9 -.72%
  
• Russell 1000: Growth/Value 20,054.4 +.18%
• CNN Fear & Greed Index 70.0 (GREED) -3.0
  
• 1-Day Vix 8.1 -6.0%
  
• Vix 18.7 +1.7%
  
• Total Put/Call 1.07 +16.3%