Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +2.8% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 15.7 +.2
  
• 8 Sectors Declining, 3 Sectors Rising
• 35.1% of Issues Advancing, 63.1% Declining 
• TRIN/Arms .65 -43.5%
  
• Non-Block Money Flow -$35.7M
  
• 106 New 52-Week Highs, 57 New Lows
• 56.8% (-1.0%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 52.0 -2.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 66.6 -.7%
• Bloomberg Cyclicals/Defensives Index 243.3 -.2%
  
• Russell 1000: Growth/Value 20,210.6 -.71%
• CNN Fear & Greed Index 48.0 (NEUTRAL) -3.0
  
• 1-Day Vix 15.2 +30.5%
  
• Vix 18.1 +10.8%
  
• Total Put/Call .79 -9.2%

Wednesday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 73.75 +.25 basis point.

• China Sovereign CDS 63.75 unch.
  
• China Iron Ore Spot 101.0 USD/Metric Tonne -.03%

• Bloomberg Emerging Markets Currency Index 37.8 +.02%.
• Bloomberg Global Risk-On/Risk Off Index 66.5 +.9%.
• Volatility Index(VIX) futures 16.2 -1.6%.
• Euro Stoxx 50 futures +.21%

• S&P 500 futures +.11%.

• NASDAQ 100 futures +.10%.  

Morning Preview Links

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

Stocks Reversing Modestly Higher into Final Hour on Lower Long-Term Rates, Earnings Outlook Optimism, Short-Covering, Tech/Construction Sector Strength

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 37.8 -.01%
• 3-Month T-Bill Yield 4.52% +1.0 basis point
  

• China Iron Ore Spot 101.3 USD/Metric Tonne +.03%
• Dutch TTF Nat Gas(European benchmark) 45.7 euros/megawatt-hour -2.6%

• Citi US Economic Surprise Index 42.1 -1.3 points
  

• Citi Eurozone Economic Surprise Index 14.1 unch.

• Citi Emerging Markets Economic Surprise Index -.3 -.3 point
• S&P 500 Current Quarter EPS Growth Rate YoY(467 of 500 reporting) +6.7% -.1 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 269.02 +.16:  Growth Rate +15.2% +.2 percentage point, P/E 21.9 unch.
  
• 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 379.0 +.24: Growth Rate +33.1% +.1 percentage point, P/E 32.5 +.2
  
• Bloomberg US Financial Conditions Index 1.04 +3.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index 1.46 -12.0 basis points
  
• US Yield Curve 10.25 basis point (2s/10s) -2.25 basis points
  
• US Atlanta Fed Q4 GDPNow Forecast +2.58% +5.0 basis points
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 34.7% +2.9 percentage points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.76% unch.: CPI YoY +2.70% -1.0 basis point
  
• 10-Year TIPS Spread 2.35 unch.
  
• Highest target rate probability for Jan. 29th FOMC meeting: 54.5%(+1.0 percentage point) chance of 4.25%-4.5%. Highest target rate probability for March 19th meeting: 40.0%(+1.2 percentage points) chance of 4.25%-4.5%. (current target rate is 4.5-4.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -119 open in Japan 
• China A50 Futures: Indicating -47 open in China

• DAX Futures: Indicating +60 open in Germany

Portfolio:

• Slightly Higher:  On gains in my utility/tech sector longs
  

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

• Market Exposure: Moved to 75% Net Long
  

Bull Radar

Style Outperformer:

• Small-Cap Growth +1.1%
  

Sector Outperformers:

• 1) Disk Drives +4.1% 2) Computer Hardware +2.9% 3) Electric Vechicles +1.6%

Stocks Rising on Unusual Volume:

• SMCI, SYM, AI, LMND, APLS, VRT, OSCR, MARA, MSTR, ENR, IONQ, HIMS, INSM, BYRN, VRNA, GCT, PRM, BLFS, INOD, U, ZETA, POWL, FLNC, RDW, LUNR, CALX, OKLO, NPWR, GEO, CLSK, RKLB, RDDT, HALO, ALAB, TOST, AVPT, NTRA, EE, OPRA, AOSL, AS, ERII, NN, GDYN, DDOG, SE, BKKT, SGRY, TLK, GLBE, MIR, ASC, AS, WMT, CECO, ARLP, TEAM, SEI, CR, CAVA, NFLX, VITL, DY and LIF
  

Stocks With Unusual Call Option Activity:

• 1) KD 2) JNPR 3) SYM 4) XLB 5) AI

Stocks With Most Positive News Mentions:

• 1) SYM 2) SMCI 3) AUR 4) UCLE 5) APLS
  

Sector ETFs With Most Positive Money Flow:

• 1) KRE 2) SMH 3) XBI 4) PAVE 5) LABU
  

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume

Afternoon Market Internals

NYSE Composite Index:

• Volume Running +8.1% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 15.5 -1.0
  
• 4 Sectors Declining, 7 Sectors Rising
• 48.3% of Issues Advancing, 49.6% Declining 
• TRIN/Arms .94 -1.1%
  
• Non-Block Money Flow -$195.8M
  
• 81 New 52-Week Highs, 72 New Lows
• 57.1% (-.3%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 54.0 unch.
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 66.6 -.7%
• Bloomberg Cyclicals/Defensives Index 244.1 -.45%
  
• Russell 1000: Growth/Value 20,300.6 +1.2%
• CNN Fear & Greed Index 51.0 (NEUTRAL) unch.
  
• 1-Day Vix 9.4 -8.8%
  
• Vix 15.8 +1.3%
  
• Total Put/Call .88 +6.0%

Tuesday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 73.5 +1.0 basis point.

• China Sovereign CDS 63.75 -.25 basis point.
  
• China Iron Ore Spot 99.4 USD/Metric Tonne -.01%

• Bloomberg Emerging Markets Currency Index 37.7 -.%.
• Bloomberg Global Risk-On/Risk Off Index 67.7 +1.1%.
• Volatility Index(VIX) futures 16.1 +1.3%.
• Euro Stoxx 50 futures -.02%

• S&P 500 futures -.05%.

• NASDAQ 100 futures -.05%.  

Morning Preview Links

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