Style Underperformer:
Sector Underperformers:
- 1) Gaming -8.36% 2) HMOs -4.37% 3) Airlines -3.72%
Stocks Falling on Unusual Volume:
- LEAF, BWLD, SSYS, HURN, SAIA, ASND, WYNN, SAVE, IDXX, NVDQ, ACHC, TWTR, GRUB, BGS, ANIK, FARO, MRCY, NATI, PRSC, SLAB, IBP, EIGI, AKAM, HUM, LL, OHI, OI, SLGN, GLW, ENTG, WM, WETF, LVS, TXRH, KKD, ACHC, ULTI, BC, SPW, CNC, WIN and X
Stocks With Unusual Put Option Activity:
- 1) WYNN 2) SSYS 3) AKAM 4) TWTR 5) FXE
Stocks With Most Negative News Mentions:
- 1) SSYS 2) WYNN 3) LL 4) LH 5) CNC
Charts:
Style Outperformer:
Sector Outperformers:
- 1) Oil Service +1.94% 2) Gold & Silver +1.28% 3) Oil Tankers +.85%
Stocks Rising on Unusual Volume:
- XPO, LOGM, GPRO, HOT, TSS, MDCA, AVY, XOOM, IPHI, AZPN, BRFS, RPXC, IPI, HOT, CRI, GT, HRG, MDLZ, KBR, VRSK, MTOR and SLCA
Stocks With Unusual Call Option Activity:
- 1) XPO 2) MDLZ 3) SAVE 4) ARCP 5) MDRX
Stocks With Most Positive News Mentions:
- 1) LOGM 2) GPRO 3) PRGO 4) OSK 5) LXK
Charts:
Evening Headlines
Bloomberg:
- China Is Set to Lose Manufacturing Crown. Manufacturers
will be drawn to Southeast Asia's strengths, including the strategic
location and cheap labor of Myanmar, Cambodia and Laos. The cheap, young labor and strategic location of Myanmar, Cambodia and Laos are set to draw increasing numbers of manufacturers to Southeast Asia, which will eventually displace China for the title of "world's factory.''
- Rule No. 1 in China’s Bull-Market Rally: Don’t Look at Earnings. If you’re worried about China’s worst earnings season since the
global financial crisis, you’re looking at this stock-market rally all
wrong. At least that’s the message from individual investors. They’ve
propelled the Shanghai Composite Index to a 90 percent surge since
mid-October, even as 2014 profits missed estimates by the most in six
years and analysts cut their outlooks at the fastest pace since 2009. Foreign skeptics see the disconnect between earnings forecasts and
share prices -- now bigger than in any of the world’s top 40 markets --
as a sign that China’s rally has gone too far.
- Europe’s Deflation Specter Moving on as Greece Clouds Recovery. The euro area’s brush with deflation might be over before it even started. After falling for four straight months, consumer prices in the
currency bloc were unchanged in April, according to economists polled by
Bloomberg. The respite, coming just as the region’s recovery improves,
signals that the effect of a slump in oil prices is petering out without
triggering a reinforcing decline in prices and wages.
- Nobody Knows Just How Bad Things Are in Nepal. Down
a side street in Kathmandu, Sumit Balang watched a bulldozer rummage
through bricks, concrete chunks and other pieces of a four-story
apartment building left in ruins after an earthquake on Saturday.
Somewhere in there was his brother. Balang’s eyes followed the slow
excavation on Tuesday morning before he showed a text message he
received the previous night from his older sibling, Amit: “I need food
and help.” Maybe Amit Balang, 33, was still alive. Maybe he wasn’t. It
started to rain.
- Russia Set to Forgo Deeper Rate Cuts as Inflation Hampers Easing. Russia’s central bank will probably maintain its current pace of
monetary easing, looking past ruble gains to keep a lid on the fastest
price growth in 13 years. The Bank of Russia will reduce its benchmark interest rate to 13
percent from 14 percent, according to 26 of 40 economists surveyed by
Bloomberg. Nine analysts predict a decrease of 150 basis points and five
see a two-point cut. The regulator will announce the decision on
Thursday at about 1:30 p.m. in Moscow.
- Goldman Sachs Sees Australia’s AAA Rating at Risk of Downgrade. Australia risks losing its top credit rating from Standard &
Poor’s for the first time in more than two decades, Goldman Sachs Group
Inc. said. Plunging commodity prices, weaker economic growth and government
difficulties in passing legislation are expected to spur a further
deterioration of the nation’s finances that could lead S&P to place
its AAA sovereign rating on negative outlook within coming months,
according to analysts Tim Toohey and Andrew Boak.
- China’s Stocks Fall for First Back-to-Back Loss in Two Months. Chinese stocks headed for their first back-to-back losses in two
months after the nation’s biggest brokerage restricted the number of
shares eligible for margin lending and commodity producers slumped on
lower profits. Agricultural Bank of China Ltd. and Bank of Communications Co. slid
at least 2 percent after the lenders reported profit growth of less than
2 percent. Anhui Conch Cement Co. dropped 2.2 percent after net income
plunged 30 percent in the first quarter. Yanzhou Coal Mining Co. led
declines for energy shares after profit fell 17 percent. Citic
Securities Co. retreated after the Securities Times reported the
brokerage will no longer accept more than 600 stocks as collateral for
margin financing.
The Shanghai Composite Index fell 1.4 percent to 4,412.91 at 10:42
a.m., after dropping 1.1 percent on Tuesday after the China Securities
Regulatory Commission warned new stock investors not to overlook the
risk of losses.
- Asian Stocks Retreat as Dollar Holds Slump Before Fed; Oil Drops. Asian shares retreated, led by declines in Sydney and Hong Kong. The
dollar traded near a two-month low amid speculation that the Federal
Reserve will keep interest rates near zero for longer, and crude oil
slipped before U.S. stockpiles data.
The MSCI Asia Pacific excluding Japan Index dropped 0.9 percent by
10:24 a.m. in Hong Kong, as Australia’s S&P/ASX 200 Index fell 1.3
percent and the Hang Seng China Enterprises Index slid 1.2 percent.
Wall Street Journal:
- SEC Is Set to Propose New Rules on Executive Compensation. Proposal makes it easier for investors to determine whether pay aligns with a firm’s financial results. Securities regulators want publicly traded companies to make it
easier for shareholders to determine whether top executives’
compensation is aligned with the firm’s financial performance. On
Wednesday, the Securities and Exchange Commission is set to propose
long-awaited rules that would force thousands of companies to tell
investors how the pay of top...
- Ukraine Leaders Fear Broad Russian Attack, Says EU’s Juncker. Summit in Kiev coincided with fresh violence in eastern Ukraine. Ukraine’s leaders believe Russia is preparing a broad attack on their
country, European Commission President Jean-Claude Juncker said Tuesday
as he returned from a summit in Kiev that coincided with fresh violence
in Ukraine’s east.
- The Blue-City Model. Baltimore shows how progressivism has failed urban America. You’re not supposed to say this in polite company, but what went up
in flames in Baltimore Monday night was not merely a senior center,
small businesses and police cars. Burning down was also the blue-city
model of urban governance. Nothing excuses the violence of
rampaging students or the failure of city officials to stop it before
Maryland’s Governor called in the National Guard. But as order starts to
return to the streets, and the usual political suspects lament the lack
of economic prospects for...
Fox News:
- Saudi Arabia arrest 93 terror suspects, foils car bomb plot on US Embassy. Saudi Arabia announced the arrest of 93 suspected terrorists with
ties to ISIS Tuesday, including two who were allegedly planning a car
bomb attack on the U.S. Embassy in Riyadh. Other potential targets for some of those arrested included residential compounds and prisons.
- Tense Baltimore stages huge police presence to prevent second night of violence. As dusk fell Tuesday night, Baltimore was a city on edge – bracing
for further violence while hoping that a huge police presence and a 10
p.m. curfew would prevent a second night of rioting. At a late afternoon press conference, Maryland Gov. Larry Hogan said
there would be 2,000 National Guardsmen on duty Tuesday night, along
with 1,000 law enforcement officers, and "this combined force will not
tolerate violence or looting."
CNBC:
Zero Hedge:
Business Insider:
Telegraph:
Evening Recommendations
Night Trading
- Asian equity indices are -1.25% to -.25% on average.
- Asia Ex-Japan Investment Grade CDS Index 106.50 -.5 basis point.
- Asia Pacific Sovereign CDS Index 59.75 -.25 basis point.
- NASDAQ 100 futures -.17%.
Morning Preview Links
Earnings of Note
Company/Estimate
- (ABB)/.35
- (ADT)/.50
- (CBG)/.26
- (ETN)/.98
- (GT)/.44
- (HES)/-1.06
- (HLT)/.12
- (HUM)/2.56
- (IP)/.80
- (LL)/.16
- (MA)/.80
- (NSC)/1.00
- (NOC)/2.27
- (VRX)/2.34
- (TWX)/1.09
- (HOT)/.56
- (BIDU)/1.14
- (ESV)/1.29
- (NE)/.50
- (YELP)/.16
- (WMB)/.12
- (TEX)/.18
Economic Releases
8:30 AM EST
- Advance 1Q GDP is estimated to rise +1.0% versus a +2.2% gain in 4Q.
- Advance 1Q Personal Consumption is estimated to rise +1.7% versus a +4.4% gain in 4Q.
- Advance 1Q Core PCE is estimated to rise +1.0% versus a +1.1% gain in 4Q.
10:00 am EST
- Pending Home Sales for March are estimated to rise +1.0% versus a +3.1% gain in February.
10:30 am EST
- Bloomberg
consensus estimates call for a weekly crude oil inventory build of
+2,781,820 barrels versus a +5,315,000 barrel build the prior week.
Gasoline supplies are estimated to rise by +336,360 barrels versus a
-2,135,000 barrel decline the prior week. Distillate inventories are
estimated to rise by +927,270 barrels versus a +395,000 barrel increase
the prior week. Finally, Refinery Utilization is estimated to rise by
+.69% versus a -1.1% decline the prior week.
2:00 pm EST
- The FOMC is expected to leave the benchmark Fed Funds rate at .25%.
Upcoming Splits
Other Potential Market Movers
- The
GFK Consumer Confidence report, 7Y Treasury auction, weekly MBA
mortgage applications report, (MSFT) analyst briefing and the (LYB)
investor day could also impact trading today.
BOTTOM LINE: Asian indices are lower, weighed down by commodity and technology
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.
Broad Equity Market Tone:
- Advance/Decline Line: Modestly Higher
- Sector Performance: Mixed
- Market Leading Stocks: Performing In Line
Equity Investor Angst:
- Volatility(VIX) 12.95 -1.30%
- Euro/Yen Carry Return Index 136.31 +.70%
- Emerging Markets Currency Volatility(VXY) 9.86 -1.0%
- S&P 500 Implied Correlation 67.75 -.07%
- ISE Sentiment Index 115.0 unch.
Credit Investor Angst:
- North American Investment Grade CDS Index 61.33 +.17%
- America Energy Sector High-Yield CDS Index 1,059.0 +.19%
- European Financial Sector CDS Index 70.57 -.10%
- Western Europe Sovereign Debt CDS Index 25.31 -4.85%
- Asia Pacific Sovereign Debt CDS Index 59.72 -.66%
- Emerging Market CDS Index 294.19 -.46%
- iBoxx Offshore RMB China Corporates High Yield Index 117.73 +.12%
- 2-Year Swap Spread 23.75 -2.0 basis points
- 3-Month EUR/USD Cross-Currency Basis Swap -20.0 -.25 basis point
Economic Gauges:
- 3-Month T-Bill Yield .01% unch.
- Yield Curve 143.0 +3.0 basis points
- China Import Iron Ore Spot $59.88/Metric Tonne +1.34%
- Citi US Economic Surprise Index -58.50 -2.5 points
- Citi Eurozone Economic Surprise Index 16.20 -1.2 points
- Citi Emerging Markets Economic Surprise Index -15.6 -1.5 points
- 10-Year TIPS Spread 1.90 unch.
Overseas Futures:
- Nikkei Futures: Indicating -89 open in Japan
- DAX Futures: Indicating +9 open in Germany
Portfolio:
- Slightly Lower: On losses in my biotech/retail sector longs
- Market Exposure: 50% Net Long
Style Underperformer:
Sector Underperformers:
- 1) Coal -1.62% 2) Biotech -.73% 3) Construction -.71%
Stocks Falling on Unusual Volume:
- EIGI, MDCA, TCS, COR, IDXX, AI, ICLR, WHR, COH, OSTK, CIT, PHG, SHG, CHRW, SHLM, SSNC, UTHR, AMOT, IBB, CHTR, JEC, OSIS, WWW, BIB, ANAC, UTHR, CSII, SVU, SCMP, ALSN, TFM, DORM, PAG, PH and NOV
Stocks With Unusual Put Option Activity:
- 1) XHB 2) NOV 3) ETN 4) FOSL 5) FXE
Stocks With Most Negative News Mentions:
- 1) DISCA 2) DNB 3) UTHR 4) CELG 5) STRA
Charts:
