Friday Watch

Night Trading 

• Asian equity indices are -.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 72.5 +.75 basis point.

• China Sovereign CDS 63.5 +.75 basis point.
  
• China Iron Ore Spot 98.1 USD/Metric Tonne -.2%

• Bloomberg Emerging Markets Currency Index 37.7 -.1%.
• Bloomberg Global Risk-On/Risk Off Index 69.8 +1.8%.
• Volatility Index(VIX) futures 15.7 +1.4%.
• Euro Stoxx 50 futures -.41%

• S&P 500 futures -.36%.

• NASDAQ 100 futures -.55%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by financial and industrial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 25% net long heading into the day.

Stocks Close Lower on Powell's Post-Election Hawkishness, Tamped Down Government Spending Worries, Profit-Taking, Healthcare/Defense Sector Weakness

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 37.7 -.06%
• 3-Month T-Bill Yield 4.51% +1.0 basis point
  

• China Iron Ore Spot 98.3 USD/Metric Tonne -.02%
• Dutch TTF Nat Gas(European benchmark) 46.2 euros/megawatt-hour +5.9%

• Citi US Economic Surprise Index 38.7 +.4 point
  

• Citi Eurozone Economic Surprise Index 14.4 -1.7 points

• Citi Emerging Markets Economic Surprise Index -1.0 +.4 point
• S&P 500 Current Quarter EPS Growth Rate YoY(461 of 500 reporting) +6.8% -.1 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 268.37 +.04:  Growth Rate +15.2% +1.2 percentage points, P/E 22.2 -.2
  
• S&P 500 Current Year Estimated Profit Margin 12.60% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +25.7% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 377.73 +.24: Growth Rate +33.2% +.6 percentage point, P/E 33.1 -.2
  
• Bloomberg US Financial Conditions Index 1.14 -3.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index 1.47 +7.0 basis points
  
• US Yield Curve 7.75 basis point (2s/10s) -9.0 basis points
  
• US Atlanta Fed Q4 GDPNow Forecast +2.45% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 32.4% +.7 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.76% +2.0 basis points: CPI YoY +2.71% +15.0 basis points.
  
• 10-Year TIPS Spread 2.34 -3.0 basis points
  
• Highest target rate probability for Jan. 29th FOMC meeting: 54.0%(-7.7 percentage points) chance of 4.25%-4.5%. Highest target rate probability for March 19th meeting: 40.8%(+9.0 percentage points) chance of 4.25%-4.5%. (current target rate is 4.5-4.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +425 open in Japan 
• China A50 Futures: Indicating -77 open in China

• DAX Futures: Indicating +53 open in Germany

Portfolio:

• Slightly Lower:  On losses in my industrial/utility sector longs
  

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
  

• Market Exposure: Moved to 25% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Growth -1.2%
  

Sector Underperformers:

• 1) Defense -4.5% 2) Electric Vehicles -2.8% 3) Cyber Security -2.1%

Stocks Falling on Unusual Volume: 

• AVDL, NU, OS, IMNM, IQV, LMT, LBRDK, PSFE, ODD, GDYN, SGRY, SHOP, INVA, TSEM, MPWR, PTLO, ACM, ZETA, PAY, STNE, AGRO, PZZA, AMBC, RKLB, HP, CW, LUNR, MMS, SDGR, PACS, NICE, BLFS, BAH, ZLAB, DAVE, PSN, TGTX, RIVN, TTEK, BILI, AMSC, IBTA, BV, LDOS, SAIC, KBR, HROW, ZK and HIMS
  

Stocks With Unusual Put Option Activity:

• 1) EH 2) TLRY 3) DIS 4) TGTX 5) INDA
  

Stocks With Most Negative News Mentions:

• 1) HIMS 2) SMCI 3) RIVN 4) BTAI 5) PACS
  

Sector ETFs With Most Negative Money Flow:

• 1) XLU 2) KWEB 3) XBI 4) XLV 5) XLE

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value -.3%
  

Sector Outperformers:

• 1) Airlines +2.3% 2) Video Gaming +2.1% 3) Homebuilders +2.0%

Stocks Rising on Unusual Volume:

• OSCR, DLO, TPR, HI, SBH, RUN, BZH, AOSL, MIRM, NTES, RGNX, WYNN, SEDG, NMRA, ENPH, GATO, CBRL, CPRI, DIS, NMM, SMWB, FSLR, CNH, DEC, SNDX, SUPV, THS, CYBR, LBTYA, YPF, CEPU, EQNR, MUFG, BTDR, GME, SWTX, TAC, OVV, ASML, OKLO, SA, SPOT, SPIR, CLPT, PWP, NN, AEM, ZIM and SATS
  

Stocks With Unusual Call Option Activity:

• 1) QUBT 2) GLW 3) EMR 4) WHR 5) TH

Stocks With Most Positive News Mentions:

• 1) OSCR 2) WYNN 3) SBH 4) BZH 5) CYBR
  

Sector ETFs With Most Positive Money Flow:

• 1) XLF 2) XLK 3) XLP 4) PAVE 5) IGV
  

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:

• (BABA)/14.82
• (SPB)/1.04
  

After the Close: 

• (MITK)/.17
• (TCOM)/6.93
  

Economic Releases

8:30 am EST

• Empire Manufacturing for Nov. is estimated to rise to 0.0 versus -11.9 in Oct.
• Retail Sales Advance MoM for Oct. is estimated to rise +.3% versus a +.4% gain in Sept.
• Retail Sales Ex Autos MoM for Oct. is estimated to rise +.3% versus a +.5% gain in Sept.
• Retail Sales Ex Auto and Gas MoM for Oct. is estimated to rise +.3% versus a +.7% gain in Sept.
• The Import Price Index MoM for Oct. is estimated to fall -.1% versus a -.4% decline in Sept.
• The Import Price Index Ex Petrol MoM for Oct. is estimated to rise +.1% versus a +.2% gain in Sept.
• The Export Price Index MoM for Oct. is estimated to fall -.1% versus a -.7% decline in Sept.
  

9:15 am EST

• Industrial Production MoM for Oct. is estimated to fall -.3% versus a -.3% decline in Sept.
• Capacity Utilization for Oct. is estimated to fall to 77.1% versus 77.5% in Sept.
• Manufacturing Production for Oct. is estimated to fall -.5% versus a -.4% decline in Sept.
  

10:00 am EST

• Business Inventories for Sept. is estimated to rise +.2% versus a +.3% gain in Aug.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Williams speaking, Atlanta Fed GDPNow Q4 update, US Baker Hughes rig count, CFTC weekly speculative net positioning reports and the (SYY) annual meeting  could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Afternoon Market Internals

NYSE Composite Index:

• Volume Running +12.9% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 19.0 +3.1
  
• 8 Sectors Declining, 3 Sectors Rising
• 39.4% of Issues Advancing, 58.7% Declining 
• TRIN/Arms .79 -4.8%
  
• Non-Block Money Flow -$228.9M
  
• 98 New 52-Week Highs, 54 New Lows
• 59.8% (-1.4%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 57.0 -2.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 69.4 -.3%
• Bloomberg Cyclicals/Defensives Index 247.1 -.83%
  
• Russell 1000: Growth/Value 20,451.7 +.18%
• CNN Fear & Greed Index 63.0 (GREED) -5.0
  
• 1-Day Vix 9.8 +1.8%
  
• Vix 13.9 -.8%
  
• Total Put/Call .80 -2.4%