Stocks Reversing Higher into Final Hour on Easing US/China Trade Tensions, More Dovish Powell Commentary, Earnings Outlook Optimism, Consumer Discretionary/Financial Sector Strength

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 36.23 +.03%
• US 10-Year T-Note Yield 4.03 -1.0 basis point
• 3-Month T-Bill Yield 3.94% unch.

• China Iron Ore Spot 105.4 USD/Metric Tonne +.2%
• Dutch TTF Nat Gas(European benchmark) 31.5 euros/megawatt-hour -2.2%

• Citi US Economic Surprise Index 8.9 -1.8 points

• Citi Eurozone Economic Surprise Index -7.7 -1.0 point

• Citi Emerging Markets Economic Surprise Index 5.0 +.5 point
• S&P 500 Current Quarter EPS Growth Rate YoY(31 of 500 reporting) +12.1% +2.4 percentage points
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 295.16 -.04:  Growth Rate +12.8% unch., P/E 22.5 unch.
• S&P 500 Current Year Estimated Profit Margin 13.48% -1.0 basis point
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 479.51 +.38: Growth Rate +18.0% +.1 percentage point, P/E 33.6 -.4
• Bloomberg US Financial Conditions Index .47 +13.0 basis points
• Bloomberg Euro-Zone Financial Conditions Index 1.49 +28.0 basis points
• Bloomberg Global Trade Policy Uncertainty Index 2.8 unch.
• US Yield Curve 54.25 basis points (2s/10s) +1.5 basis points
• US Atlanta Fed GDPNow Q2 Forecast +3.8% unch.
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 40.4% +3.1 percentage points

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.87% unch.: CPI YoY +2.99% unch.
• 1-Year TIPS Spread 2.64 +1.0 basis point
• 10-Year TIPS Spread 2.31 -1.0 basis point
• Highest target rate probability for Dec. 10th FOMC meeting: 96.1% (+.6 percentage points) chance of 3.5%-3.75%. Highest target rate probability for Jan. 28th meeting: 51.2%(+2.1 percentage points) chance of 3.5%-3.75%. (current target rate is 4.0-4.25%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +460 open in Japan 
• China A50 Futures: Indicating +43 open in China

• DAX Futures: Indicating +211 open in Germany

Portfolio:

• Higher: On gains in my utility/financial/consumer discretionary/industrial sector longs and emerging market shorts
• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges 
• Market Exposure: Moved to 100% Net Long

Bear Radar

Style Underperformer:

• Large-Cap Growth -.3%
  

Sector Underperformers:

• 1) AI/Innovation -2.1% 2) Disk Drives -1.3% 3) Electric Vehicles -1.3%

Stocks Falling on Unusual Volume: 

• SNDK, RYN, SKE, BCAX, GRND, XNCR and ALAB

Stocks With Unusual Put Option Activity:

• 1) FHN 2) FBL 3) CAN 4) SGML 5) CRML

Stocks With Most Negative News Mentions:

• 1) OEC 2) HUM 3) XNCR 4) ALAB 5) SMLR

Sector ETFs With Most Negative Money Flow:

• 1) XLE 2) KRE 3) CONY 4) ITB 5) PHO

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +2.1%

Sector Outperformers:

• 1) Nuclear +4.8% 2) Airlines +4.6% 3) Homebuilding +3.1%

Stocks Rising on Unusual Volume:

• TMQ, ATXS, CRML, NVTS, HOND, ABAYT, FLNC, NKLR, DBRG, ORLA, LPTH, ALMU, CRNC, ACI, ARCT, SHLS, PII, UUUU, SYRE, WULF, CSIQ, ORKA, IDR, STOK, MARA, OUST, FCEL, PCT, CLSK, JACK, POWI, SOUN, ESTA, SSTK, DLO, UAMY, HRTG, PGY, ASTS, WFC, JOBY, DRVN, NB, PZZA, QBTS, BTU,  KEP, PLAY, SYM, ASPI, OKLO, ALLY, GIG, AOSL, CARS, VOYG, TRVI, EEFT, RKLB, ZIM, KBH, NX, AMSC, KKR, ARES, TASK, MNMD, CAT, SLM, WMT, OWL, FBK, LEGN, APO, C, APLD, SYF, UEC, ABNB, QUBT, HPQ, METC, DPZ, CLB, GKOS, AUGO, ENS, LVS, CIFR, BLK, IE, HALO, MP, CCJ, SMR, CUK, TEAM, LENZ, PPTA, MAIN, AMD, CTS, ERO, GDOT, FNB and DLTR

Stocks With Unusual Call Option Activity:

• 1) DBRG 2) IVZ 3) TTI 4) TMQ 5) ERO

Stocks With Most Positive News Mentions:

• 1) CRML 2) REKR 3) ACI 4) POWI 5) CCJ

Sector ETFs With Most Positive Money Flow:

• 1) XLF 2) SOXX 3) FDN 4) VGT 5) XLV

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:

• (ABT)/1.30
• (ASML)/6.38
• (BAC)/.95
• (MS)/2.10
• (PNC)/4.05
• (PGR)/5.04
• (PLD)/1.44
• (SYF)/2.23
• (FHN)/.45
• (CFG)/1.03
• (KMI)/.29
• (LVS)/.61 

After the Close: 

• (JBHT)/1.46
• (PNFP)/2.04
• (SLG)/1.41
• (SNV)/1.36
• (UAL)/2.65 

Economic Releases 

8:30 am EST

• Empire Manufacturing for Oct. is estimated to rise to -1.8 versus -8.7 in Sept.

2:00 pm EST 

• Fed's Beige Book report release. 

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Waller speaking, Fed's Schmid speaking, Fed's Miran speaking, Fed's Bostic speaking, real earnings MoM for Sept., weekly MBA Mortgage Applications report, IMF Meetings, API weekly crude oil stock report, Open Compute Project Global Summit, (DLTR) investor day, (CRM) investor day, (BF/B) investor day, (HPE) analyst meeting and the (BG) business update call 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 +11.8% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 15.6 +1.8
• 1 Sector Declining, 10 Sectors Rising
• 67.9% of Issues Advancing, 30.3% Declining 
• TRIN/Arms .86 +1.2% 
  
• Non-Block Money Flow -$50.8M
  
• 64 New 52-Week Highs, 60 New Lows
• 62.7% (+3.7%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 53.7 +4.0

Polymarket:

• Will Congress pass a funding bill by Oct. 31st?  33.0% +2.0 percentage points
• US tariff rate on China on Nov. 12th? 25-40% 69.0% +3.0 percentage points 
• Will China invade Taiwan by end of 2026? 16.0% unch.

Other:

• Bloomberg Global Risk-On/Risk-Off Index 79.0 -2.5%
• US High-Yield All Sectors OAS Index 360.5 -9.0 basis points
• Bloomberg Cyclicals/Defensives Index 251.4 +1.2%
  
• Morgan Stanley Growth vs Value Index 169.4 -.9%
• CNN Fear & Greed Index 32.0 (FEAR) -1.0
• 1-Day Vix 13.8 -5.6%
  
• Vix 19.5 +2.3%
  
• Total Put/Call .76 -3.2%

Tuesday Watch

Around X:

• @Business 

• President Trump used a one-day tour of Israel and Egypt to soak in the praise from fellow leaders and lay out a vision for broader Middle East peace after the success of US-led mediation efforts to end the fighting in Gaza.
• Google is planning to invest more than $10 billion in southern India to set up a 1-gigawatt data center, marking one of its biggest bets in a market that’s key to its global expansion plans.
• Samsung posted its biggest quarterly profit in more than three years, reflecting booming memory chip demand while AI development accelerates globally.
• Fluence expects US orders to make up a large share of its backlog next year as power demand surges from electrification and data center growth. 
• The Trump administration is inviting all US colleges to participate in a compact that would grant preferential federal funding in return for commitments to specific policy changes like DEI bans, according to a source. 
• The alt-coin casino blew up in speculator fashion last week — and it’s not clear the gamblers are coming back. 
• Spot silver prices surged to an all-time high above $52.50 an ounce, eclipsing a peak set in during a notorious attempt to the corner the global market in 1980. 
• Get up to speed on what's moving global markets. 
• Here’s what you need to know to start your day. 

• @ZeroHedge

• The high beta white metals are going vertical now.
• IDF Vows To Destroy All Hamas 'Terror Tunnels' As Part Of Disarming Gaza.
• *CHINA: CHINA, US HELD WORKING-LEVEL TRADE TALKS YESTERDAY. *CHINA: US-CHINA COOPERATION BENEFITS BOTH SIDES. olive branches everywhere.  
• *CHINA SAYS EXPORT CURBS AREN'T EXPORT BAN. *CHINA: RARE EARTH EXPORT CONTROLS ARE LAWFUL. *CHINA URGES US TO CORRECT WRONGDOINGS.
• The money is not the problem: AI is the new global arms race, and capex will eventually be funded by governments (US and China). If you want to know why gold/silver/bitcoin is soaring, it's the "debasement" to fund the AI arms race. But you can't print energy. 
• Unprecedented Times: "It's Hard To Keep Up, Even By Experienced Folks".
• Holy shit. MIT just built an AI that can rewrite its own code to get smarter . It’s called SEAL (Self-Adapting Language Models). Instead of humans fine-tuning it, SEAL reads new info, rewrites it in its own words, and runs gradient updates on itself literally performing self-directed learning. The results? +40% boost in factual recall. Outperforms GPT-4.1 using data it generated *itself*. Learns new tasks without any human in the loop.  
• China's Housing Slump Deepens As Holiday Spending Softens.
• Peter Schweizer: Mamdani Family Is "Joined At The Hip" With Foreign Radical Powers.
• This is by far the most fundamentally sound and bullish development we have seen in months. Perhaps not for the stock market but for society. Social media time is shrinking for the first time ever, and young people are leading the pullback. Brainrot is OUT. Meaning is IN. 
• Gold & Silver Soar To New Record Highs As TACO-Talk Sparks Rebound In Stocks
  . 

• @CNBC

• Asia-Pacific markets set to open lower as new China port fees on U.S. ships kick in.
• Broadcom CEO says generative AI will become a much larger part of global GDP.
• Tuesday's big stock stories: What’s likely to move the market in the next trading session. 
• Stock futures are little changed after big rebound on Wall Street, S&P 500 posts best day since May: Live updates. 
• 'The combination of AI and automation is very powerful,' says @UiPath CEO @danieldines.

• @WSJ 

• President Trump scored a major foreign policy win in Gaza. Ahead of Ukrainian President Zelensky’s visit to the White House on Friday, Europeans are hoping Trump can repeat the success with another knotty foreign-policy problem. 
• Ahead of a cryptocurrency selloff, two accounts placed bets against the market minutes before tariff news broke and scored $160 million.
• Jared Kushner, who had sworn off any formal role in President Trump’s second term, has been at the center of every decision leading up to the breakthrough agreement between Israel and Hamas.

• @LauraLoomer

• Looks like @RepMTG got a check. She just went on a podcast and said she doesn’t think illegal alien workers should be deported. We need to put AMERICAN workers first. We don’t need to be coddling and protecting big corporations that evade the law to hire cheap illegal aliens. (video)
• Qatar paid for Mamdani’s mother’s films and lets his wife teach a course in Doha. Yet some Republicans think Qatar is our friend. People better wake up… FAST. 

• @newstart_2024 

• Dr. Robert Lustig: "The 95% Lie About Alzheimer's They Don't Want You to Know". We’ve been sold a fatalistic narrative: "Alzheimer's is genetic." This is a diversion. The data is clear. The genetic component is a mere 5%. That means 95% of Alzheimer's risk is environmental. Your brain isn't failing by chance; it's being assaulted. By what? Air Pollution. Microplastics. Ultra-Processed Food. A landmark paper just confirmed a direct correlation between sweetener consumption and dementia. And we know the biochemical mechanism. The root of this crisis is in plain sight: the American grocery store.

• @VigilantFox

• Bombshell Vax vs. Unvax Study Finally Sees the Light of Day — And the Results Are Staggering. This data “should shock everyone.” (thread)
• Look closely at this graph — the results are jaw-dropping. Vaccinated kids: 57% chance of developing a chronic disease in the first 10 years of life. Unvaccinated kids: Only 17%. “That should shock everyone.” This figure is nearly identical to national data, which says that 54% of American children now have at least one chronic condition. The graph comes from a vax vs. unvax study that’s been buried for five years. Dr. Marcus Zervos led the research but chose not to publish it, admitting, “Publishing something like that, I might as well retire. I’d be finished.” (video)

• @HustleBitch_

• THE INTERNET KNEW BEFORE IT HAPPENED. Google Trends shows a massive surge in searches for “Tyler Robinson Charlie Kirk” on July 14, 2025. READ THAT AGAIN. That’s nearly two months BEFORE those names were ever connected in real life. How does that happen? How were people searching for something that didn’t exist yet? Go check Google Trends yourself... the spike is right there.

• @NicHulscher

• REMINDER: Criminal Referral Requests Filed Against Fauci and Top COVID Officials in SEVEN States — Accused of Murder, Racketeering, Fraud, Abuse, Terrorism & More. TWO county-level criminal investigations are already underway. NAMED INDIVIDUALS: • Dr. Anthony Fauci. • Dr. Francis Collins. • Dr. Deborah Birx. • Dr. Rochelle Walensky. • Dr. Stephen Hahn. • Dr. Cliff Lane. • Dr. Robert Redfield. • Dr. Peter Daszak. • Dr. Ralph Baric. • Dr. Rick Bright. • Dr. Janet Woodcock. • Dr. Peter Hotez.

• @ProjectVirginia

• Watched this 50 times. Might be the most devastating political ad in decades. And it's a completely self-inflicted wound by an arrogant, smug candidate who's quite put out having to lower herself to even appear on the same stage as her opponent. Spanberger's sociopathic reaction is way worse than McAuliffe's gaffe. The more you see this the more creepy it gets. (video)

• @IngrahamAngle

• Spanberger's lead is shrinking. She's beatable. The Commonwealth can vote to save itself. Hope President Trump stumps for Winsome Sears. Spanberger is a total disaster, a leftist on issues from trans in girls sports to immigration, packaged as a moderate "soccer mom". Go
  @winwithwinsome.

• @SecDuffy

• Tomorrow in the middle of a shutdown, Democrats are expected to go on a LUXURY retreat in Napa… complete with hot tubs, high-end dinners, and an organic vineyard. Where are our air traffic controllers? WORKING WITHOUT PAY to keep our airspace safe. End the shutdown and get the American people their paychecks!

• @craigkellyAFEE

• Australia’s productivity growth is not only the 2nd worst in the OECD, it’s going backwards. But what do you expect when we have clueless politicians "picking winners" and directing investment into wasteful projects in the name of Net Zero? What do you expect when we are only nation in world closing down our base load power and attempting to replace it with weather dependent intermittent generation (solar & wind). What do you expect when we have surrendered our nation’s competitive advantage low cost energy from coal.

• @SigneyPowell1

• The Census Bureau used a secretive algorithm to overthrow the United States government in 2020. They admitted they got it wrong in 2020 — but it’s even worse than a miscount. States were intentionally over- and under-counted, costing citizens seats in Congress and Electoral College votes. The Census Bureau used a secretive algorithm called differential privacy, which only a handful of leftist bureaucrats and traitors have access to, to scramble block-level data, hide citizenship status, and shift political power to non-citizens — illegal aliens. This needs official investigation!! @AGPamBondi @FBIDirectorKash Who is responsible for this part of the fraud? This was all a big operation.

• @BubbleBathGirl

• Gov. JB Pritzker says he’s scared to turn over voter data from Illinois and doesn’t want law enforcement making sure only Americans are voting. He gives a convoluted explanation for why he wants elections to be less secure. Pritzker is cheating. (video)

• @C_3C_3

• When you realize the wife of the guy that prosecuted Jan 6ers runs the “No Kings” protests everything makes sense. Then you learn she also started a legal defense fund with a lawyer representing EJ Carroll and your head is ready to explode. Fatima Graves. A tangled web of evil.

• @stkirsch

• Now available! Watch for free at: http://aninconvenientstudy.com. Please re-post. This a mind blowing film showing first hand just how corrupt our MOST RESPECTED mainstream scientists are. When they get a result, they don’t like, they don’t publish it in order to save their jobs. It doesn’t matter how much harm it causes. Keeping THEIR job is more important than the health of YOUR kids. (video)

Night Trading 

• Asian equity indices are +.25% to +1.25% on average. 
• Asia Ex-Japan Investment Grade CDS Index 68.25 +.5 basis point.
• China Sovereign CDS 45.0 -.5 basis point.
• China Iron Ore Spot 105.6 USD/Metric Tonne -2.0%. 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.88 unch.
• Bloomberg Emerging Markets Currency Index 36.2 -.01%.
• Bloomberg Global Risk-On/Risk Off Index 80.8 -.3%.
• US 10-Year Yield 4.06% +3.0 basis points.
• Volatility Index(VIX) futures 19.6 -.7%.
• Euro Stoxx 50 futures +.32%. 
• S&P 500 futures +.26%
• NASDAQ 100 futures +.38%.

Morning Preview Links

BOTTOM LINE: Asian indices are modestly higher, boosted by technology 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.