Thursday, May 01, 2025

Friday Watch

Around X:

  • @ElonMusk
  • @ZeroHedge
  • @MarioNawful
  • U.S. ARMY GOES FULL DRONE MODE AFTER WATCHING UKRAINE. The Army saw Ukraine’s war, said “Whoa,” and is now turning into a flying robot army with 1,000 drones per division. They’ve been testing swarms of buzzing drones that spy, deliver supplies, and blow stuff up—all while soldiers sit back and watch from a tablet like it’s Call of Duty: Real Life Edition. General Randy George says they’re not asking for more money—just tossing out ancient gear like Humvees, light tanks, and even some helicopters to pay for a $36 billion high-tech upgrade. They want zero parts from China, more lasers, better battlefield Wi-Fi, and fewer people getting blown up. Basically: fewer boots, more bots, no boomers.
  • TRUMP: WE’RE SHUTTING DOWN IRAN’S OIL DEALS—STARTING NOW! "ALERT: All purchases of Iranian Oil, or Petrochemical products, must stop, NOW! Any Country or person who buys ANY AMOUNT of OIL or PETROCHEMICALS from Iran will be subject to, immediately, Secondary Sanctions. They will not be allowed to do business with the United States of America in any way, shape, or form. Thank you for your attention to this matter, PRESIDENT DONALD J. TRUMP!"
  • TECH STOCKS ROAR BACK ON AI HYPE. Microsoft’s AI is getting so good, it’s now doing more of the work than ever—16% of its cloud growth came from AI magic this quarter. Last time? Just 13%. Upgrade unlocked. Meta’s using AI to vacuum up ad cash like a Roomba on Red Bull, even while Trump’s trade tantrums keep messing with the global economy. Investors freaked out—in a good way—and went shopping. Nvidia, AMD, Broadcom? All up. Apple? Still grounded after a court said, “Nice try” on App Store changes. Microsoft soared 8.7%, Meta jumped 4.5%, and AI stocks partied like it’s 2029. 
  • U.S. SAYS BIG INSURANCE RAN A MEDICARE BRIBE FEST. The Justice Department just dropped a bomb on the healthcare world—accusing top insurers of turning Medicare sign-ups into a dirty money game. CVS’s Aetna, Humana, and Elevance allegedly handed brokers hundreds of millions in shady kickbacks to push seniors into their Medicare Advantage plans. And it wasn’t just the insurers—brokers like eHealth, GoHealth, and SelectQuote are also in the hot seat for playing middleman in the scheme. The feds say it’s all a massive fraud under the False Claims Act. Translation: this wasn’t “marketing”—it was a multi-million dollar hustle.
  • UBER TO DEPLOY THOUSANDS OF ROBOTAXIS — BECAUSE HUMANS ARE OVERRATED. Uber’s teaming up with May Mobility to drop thousands of self-driving Toyota vans on U.S. streets, starting in Arlington, Texas, by late 2025. Think Uber but without the awkward small talk. These robotaxis will start with human safety drivers (because, ya know, “trust issues”) before going fully driverless. It’s Uber’s latest move to beat Tesla’s Cybercab and Lyft in the robotaxi race. Good luck with that. The U.S. government’s cool with it — as long as the bots play by the rules and report their whoopsies.
  • JD VANCE: IF THE PRESIDENT CAN’T DEPORT ILLEGAL CRIMINALS, “HE’S NOT ALLOWED TO BE PRESIDENT”. "The judge doesn’t decide if the Alien Enemies Act applies—the President does. Biden let in millions, and now we’re being blocked from deporting them. If you tell the President he can’t deport illegal criminals, you’re saying he can’t be President. We reject that, and so will the Supreme Court. We were elected to fix this, and we will." (video)
  • ELON: ONLY 10–15¢ ON THE DOLLAR REACHES RECIPIENTS—THE REST GETS STOLEN IN D.C. "Even if you agree with supporting alpaca farmers in Peru, most of the money never makes it there. It goes into the pockets of people in D.C. The GAO estimated only 10 to 15 cents on the dollar reaches the recipient. There's layer after layer of stealing—like peeling an onion." (video)
  • ELON: FRAUD ALWAYS STARTS SMALL, THEN THEY RENT STADIUMS. “Generally, the fraud starts out small and they try to hide it. But then, year after year, if nobody stops the fraud, it gets more and more brazen. And every year it gets bigger—until they’re literally renting out stadiums, like in the millions, just to run the fraud.” (video)
  • @LauraLoomer
  • EXCLUSIVE. Alex Wong, the Chinese Deputy National Security Advisor appointed by President Trump, who is at the center of the Signalgate scandal, is married to U.S. Attorney Candice Chiu Wong, a Chinese Woman who was one of the key attorneys involved in PROSECUTING J6ers. Alex Wong was appointed by President Trump on 11/22/24 to serve as the Assistant to the President and the Principal Deputy National Security Advisor under @MikeWaltz47 Mike Waltz, the newly appointed US National Security Advisor. SCALP.
  • @TheTranscript
  • $AAPL CEO @tim_cook: "For the June quarter, we do expect the majority of iPhones sold in the U.S. will have India as their country of origin. Vietnam to be the country of origin for almost all iPad, Mac, Apple Watch, and AirPods products sold in the U.S. China would continue to be the country of origin for the vast majority of total product sales outside the U.S."
  • $AAPL CEO: "Today we are reporting $95.4 billion in revenue, up 5% from a year ago, and at the high end of the range we provided last quarter...Services revenue was $26.6 billion, up 12% year-over-year". 
  • $AAPL Apple Inc. Q1 25 Segment & Regional Sales: By Category:  • iPhone: +1.9% to $46.8B  • Mac: +6.7% to $7.9B  • iPad: +15.1% to $6.4B  • Wearables, Home & Accessories: –4.9% to $7.5B  • Services: +11.6% to $26.6B By Geography:  • Americas: +8.2% to $40.3B  • Europe: +1.4% to $24.5B  • Greater China: –2.3% to $16.0B  • Japan: +16.6% to $7.3B  • Rest of Asia Pacific: +8.4% to $7.3B
  • $AMZN CEO: "Moving next to our AWS segment, revenue was $29.3 billion in Q1, an increase of 17% year over year. AWS now has an annualized revenue run rate of more than $117 billion". (graph) 
  • $AMZN Amazon Q1 25 Segment Highlights: Net sales growth: —North America: +8 % —International: +5% —AWS: +17% —Consolidated: +9%.
  • Amazon double beat. CEO @ajassy: "We’re pleased with the start to 2025". $AMZN: -4% AH. (details)
  • @bennyjohnson
  • @DC_Draino 
  • @JimFerguson
  • UKCATHERINE AUSTIN FITTS EXPOSES THE GLOBALIST PLAN: “THIS ISN’T A RESET — IT’S A TAKEOVER”. Former Bush administration official Catherine Austin Fitts isn’t staying silent. “The Great Reset is NOT about helping you — it’s about controlling you.” As former Assistant Secretary of Housing and Urban Development, she’s seen the machinery of power up close — and now she’s warning the world. THIS ISN’T A THEORY — IT’S A BLUEPRINT FOR GLOBAL TYRANNY. WHAT THIS MEANS:
  • @MJTruthUltra 
  • @sheislaurenlee
Night Trading 
  • Asian equity indices are unch. to +1.0% on average. 
  • Asia Ex-Japan Investment Grade CDS Index 95.0 -2.0 basis points. 
  • China Sovereign CDS 60.0 -1.5 basis points.
  • China Iron Ore Spot 95.3 USD/Metric Tonne +.2%
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.75 -.37%.
  • Bloomberg Emerging Markets Currency Index 36.9 -.12%.
  • Bloomberg Global Risk-On/Risk Off Index 59.4 +1.0%.
  • US 10-Year Yield 4.24% +2.0 basis points.
  • Volatility Index(VIX) futures 23.1 -.7%.
  • Euro Stoxx 50 futures +1.2%. 
  • S&P 500 futures +.56%. 
  • NASDAQ 100 futures +.26%.
Morning Preview Links

BOTTOM LINE: Asian indices are modestly higher, boosted by industrial and consumer discretionary 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 Higher into Final Hour on Earnings Outlook Optimism, US Global Trade Deal Hopes, US Economic Data, Tech/Energy Sector Strength

Broad Equity Market Tone:

  • Advance/Decline Line: Higher
  • Sector Performance: Most Sectors Rising
  • Volume: Around Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 23.8 -3.6%
  • S&P 500 Intraday % Swing .93 -66.0%
  • Bloomberg Global Risk On/Risk Off Index 59.2 +1.7% 
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.75 -.55%
  • Euro/Yen Carry Return Index 184.43 +1.4%
  • Emerging Markets Currency Volatility(VXY) 8.63 unch.
  • CBOE S&P 500 Implied Correlation Index 33.1 -2.0% 
  • ISE Sentiment Index 163.0 +65.0
  • Total Put/Call .81 -1.2%
  • NYSE Arms 1.05 -13.2%
  • NYSE Non-Block Money Flow -$120.8M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 67.0 -.08%
  • US Energy High-Yield OAS 476.6 -3.5%
  • Bloomberg TRACE # Distressed Bonds Traded 279.0 +4.0
  • European Financial Sector CDS Index 72.1 -1.5%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 165.0 -.1%
  • Italian/German 10Y Yld Spread 112.0 basis points -1.0 basis point
  • Asia Ex-Japan Investment Grade CDS Index 96.7 -.4%
  • Emerging Market CDS Index 200.6 +1.0%
  • Israel Sovereign CDS 105.2 -.74%
  • China Corp. High-Yield Bond USD ETF(KHYB) 23.7 +.16%
  • 2-Year SOFR Swap Spread -23.75 basis points +.25 basis point
  • 3M T-Bill Treasury Repo Spread -7.75 basis point -1.75 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -1.5 unch.
  • MBS  5/10 Treasury Spread 160.0 unch.
  • Bloomberg CMBS Investment Grade Bbb Average OAS 643.0 +1.0 basis point
  • Avg. Auto ABS OAS 76.0 -1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 36.97 +.02% 
  • US 10-Year T-Note Yield 4.23% +6.0 basis points
  • 3-Month T-Bill Yield 4.29% unch.
  • China Iron Ore Spot 95.5 USD/Metric Tonne +.4%
  • Dutch TTF Nat Gas(European benchmark) 32.1 euros/megawatt-hour -.5%
  • Citi US Economic Surprise Index -12.9 -4.3 points
  • Citi Eurozone Economic Surprise Index -15.9 -.2 point
  • Citi Emerging Markets Economic Surprise Index 20.7 +1.9 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(325 of 500 reporting) +14.1% +.5 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 275.58 +.01:  Growth Rate +11.8% -.3 percentage point, P/E 20.4 +.4
  • S&P 500 Current Year Estimated Profit Margin 13.38% -2.0 basis points
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(5 of 10 reporting) +32.5% -10.7 percentage points
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 422.34 +.72: Growth Rate +22.1% +.2 percentage point, P/E 30.1 +1.1
  • Bloomberg US Financial Conditions Index -.22 -3.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index .97 -5.0 basis points
  • Bloomberg Global Trade Policy Uncertainty Index 10.7 -.1
  • US Yield Curve 52.75 basis points (2s/10s) -3.0 basis points
  • US Atlanta Fed GDPNow Q2 Forecast +1.1% -130.0 basis points
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 49.6% +2.1 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.61% unch.: CPI YoY +2.34% unch.
  • 1-Year TIPS Spread 3.17 +4.0 basis points
  • 10-Year TIPS Spread 2.25 +1.0 basis point
  • Highest target rate probability for June 18th FOMC meeting: 55.0% (-8.2 percentage points) chance of 4.0%-4.25%. Highest target rate probability for July 30th meeting: 45.9%(-13.1 percentage points) chance of 3.75%-4.0%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +650 open in Japan 
  • China A50 Futures: Indicating -36 open in China
  • DAX Futures: Indicating +108 open in Germany
Portfolio:
  • Higher: On gains in my utility/tech/consumer discretionary/industrial sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 75% Net Long

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open:
  • (AES)/.35
  • (AXL)/.04
  • (CBOE)/2.36
  • (CVX)/2.16
  • (DD)/.95
  • (ETN)/2.71
  • (XOM)/1.75
  • (FLR)/.50
  • (MGA)/.85
  • (PIPR)/2.65
  • (TROW)/2.13
  • (TEX)/.53
  • (CI)/6.35
  • (WEN)/.20
  • (GT)/-.03
After the Close: 
  • None of note
Economic Releases

8:30 am EST

  • The Change in Non-Farm Payrolls for April is estimated at +137K versus +228K in March.
  • The Unemployment Rate for April is estimated at 4.2% versus 4.2% in March.
  • Average Hourly Earnings MoM for April is estimated to rise +.3% versus a +.3% gain in March.

10:00 am EST

  • Factory Orders for March is estimated to rise +4.5% versus a +.6% gain in Feb.
  • Factory Orders Ex Transports for March is estimated to rise +.3% versus a +.4% gain in Feb.
  • Final Durable Goods Orders readings for March.

Upcoming Splits

  • None of note
Other Potential Market Movers
  • The CFTC weekly speculative net positioning reports, US Baker Hughes weekly oil rig count, (LDOS) annual meeting, (ETR) annual meeting, (ZION) annual meeting, (LSCC) annual meeting, (MAN) annual meeting, (R) annual meeting and the (ITW) annual meeting could also impact global trading tomorrow.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST

Bear Radar

Style Underperformer:

  • Large-Cap Value +.4%
Sector Underperformers:
  • 1) Gold & Silver -3.8% 2) Pharma -3.4% 3) Telecom -1.2%
Stocks Falling on Unusual Volume: 
  • MGM, RYN, ATRC, GL, SCI, SAIA, HUBB, ICLR, EZPW, FTV, BR, PCVX, WCC, BLDR, RSI, SKT, ALHC, AIT, VTR, CHD, BE, CMPR, HCC, UTZ, QCOM, OCSL, THRY, CDNA, LLY, AGI, FTAI, PPC, GKOS, BDX, GPK and CFLT
Stocks With Unusual Put Option Activity:
  • 1) IWD 2) OGN 3) MPW 4) FTAI 5) CART
Stocks With Most Negative News Mentions:
  • 1) LLY 2) SAIA 3) QCOM 4) GERN 5) SANA
Sector ETFs With Most Negative Money Flow:
  • 1) XLF 2) XLI 3) XLP 4) ARKK 5) XLU

Bull Radar

Style Outperformer:

  • Large-Cap Growth +2.0%
Sector Outperformers:
  • 1) Software +5.2% 2) Networking +4.5% 3) Construction +2.8%
Stocks Rising on Unusual Volume:
  • CEP, TNDM, MYRG, UPBD, AEIS, AAOI, NTGR, TTMI, OLED, CNMD, GTLS, CRWV, FTDR, ATI, CARR, PWR, ZYBT, AGCO, EVER, OSIS, BPMC, IDXX, OKLO, COHR, HGV, MSFT, VRT, CWH, ANET, HWM, BTDR, CEG, CNH, VAL, CIEN, CLS, APG, MTZ, HIMS, FORM, MARA, PRIM, VST, MOD, DRS, QNST, CVS, H, ALKS, LRN, WAY, HAYW, META, PATK, CRS, KIM, SEI, AXGN, ZETA, AAON, SUI, EXTR, DE, APAM, CTSH, SION, HURN, ORCL, MGPI, FLEX, SON, SMG, ARM, CEPO, SION, TREE, CSTM, SMLR, ACT, KNSA, HLT, PTC, RDDT, HST, ETN, CAH, RDDT, ULS, MTX, JBGS, DUOL, CUK, NVT, AX and AVT
Stocks With Unusual Call Option Activity:
  • 1) NXE 2) BMBL 3) MTCH 4) HST 5) FNGR
Stocks With Most Positive News Mentions:
  • 1) TTMI 2) MSFT 3) MAX 4) ATI 5) GTX
Sector ETFs With Most Positive Money Flow:
  • 1) FDN 2) XLV 3) IGV 4) KRE 5) XLK
Charts:

Mid-Day Market Internals

NYSE Composite Index:

  • Volume Running +6.3% Above 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 14.2 -2.3
  • 3 Sectors Declining, 8 Sectors Rising
  • 54.0% of Issues Advancing, 44.4% Declining 
  • TRIN/Arms 1.09 -9.9%
  • Non-Block Money Flow -$160.5M
  • 24 New 52-Week Highs, 15 New Lows
  • 32.1% (+3.4%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 54.9 +2.6
Other:
  • Bloomberg Global Risk-On/Risk-Off Index 58.3 +.2%
  • Bloomberg Cyclicals/Defensives Index 228.9 +.6%
  • Russell 1000: Growth/Value 20,466.0 +1.7%
  • CNN Fear & Greed Index 48.0 (Neutral) +16.0
  • 1-Day Vix 22.2 -3.0%
  • Vix 24.7 +.1%
  • Total Put/Call .82 unch.