Thursday, October 31, 2024

Friday Watch

Around X:
  • @elonmusk
  • @LauraLoomer
  • @CollinRugg
  • @DC_Draino
  • @jackunheard
  • @glennbeck
  • @CharlieKirk11
  • @Braden240492621
  • @TrueTheVote
  • @JamesOKeefeIII
  • @zerohedge
  • @RepMTG
  • @WallStreetApes
  • @LibsofTiktok
  • @SidneyPowell1
  • @BehizyTweets
  • @catturd
  • @BennyJohnson
  • @LaraLogan
  • @TrumpWarRoom
  • @JohnBasham
  • @JacobMagid
  • @VigilantFox
Night Trading 
  • Asian equity indices are -1.25% to -.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 72.75 +1.25 basis points.
  • China Sovereign CDS 64.5 +1.0 basis point.
  • China Iron Ore Spot 102.6 USD/Metric Tonne -1.0%
  • Bloomberg Emerging Markets Currency Index 38.1 -.04%.
  • Bloomberg Global Risk-On/Risk Off Index 61.1 +.9%.
  • Volatility Index(VIX) futures 20.8 -.8%.
  • Euro Stoxx 50 futures +.14%.
  • S&P 500 futures +.10%.
  • NASDAQ 100 futures +.26%.  
Morning Preview Links

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

Stocks Falling Substantially into Final Hour on Growing US Election Integrity Concerns, Escalating Mid-East Regional War Fears, Earnings Outlook Jitters, Tech/Road & Rail Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Most Sectors Declining
  • Volume: Above Average
  • Market Leading Stocks: Outperforming
Equity Investor Angst:
  • Volatility(VIX) 23.0 +13.2%
  • DJIA Intraday % Swing .68 -8.2%
  • Bloomberg Global Risk On/Risk Off Index 61.0 -3.7%
  • Euro/Yen Carry Return Index 183.3 -.75%
  • Emerging Markets Currency Volatility(VXY) 10.0 -1.1%
  • CBOE S&P 500 Implied Correlation Index 20.5 +19.4% 
  • ISE Sentiment Index 130.0 -21.0 points
  • Total Put/Call .94 +4.4%
  • NYSE Arms .85 -11.5%
  • NYSE Non-Block Money Flow -$184.5M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 53.7 +1.9%
  • US Energy High-Yield OAS 319.8 +2.3%
  • Bloomberg TRACE # Distressed Bonds Traded 194 +2
  • European Financial Sector CDS Index 65.38 +1.9%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 159.99 +1.7%
  • Italian/German 10Y Yld Spread 126.0 basis points +1.0 basis point
  • Asia Ex-Japan Investment Grade CDS Index 72.26 +1.3%
  • Emerging Market CDS Index 168.0 +1.7%
  • Israel Sovereign CDS 132.85 +1.7%
  • China Corp. High-Yield Bond USD ETF(KHYB) 25.0 unch.
  • 2-Year SOFR Swap Spread -22.25 basis points -.25 basis point
  • 3M T-Bill Treasury Repo Spread -26.5 basis points -3.0 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -4.5 -.25 basis point
  • MBS  5/10 Treasury Spread 155.0 +4.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 684.0 +1.0 basis point
  • Avg. Auto ABS OAS 57.0 unch.
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 38.2 -.02%
  • 3-Month T-Bill Yield 4.54% -3.0 basis points
  • China Iron Ore Spot 102.8 USD/Metric Tonne -.90%
  • Dutch TTF Nat Gas(European benchmark) 40.60 euros/megawatt-hour -1.9%
  • Citi US Economic Surprise Index 38.6 +3.2 points
  • Citi Eurozone Economic Surprise Index 4.3 +4.9 points
  • Citi Emerging Markets Economic Surprise Index -4.3 +.6 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(326 of 500 reporting) +9.1% +.4 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 268.61 +.24:  Growth Rate +15.1% +.1 percentage point, P/E 21.3 -.5
  • S&P 500 Current Year Estimated Profit Margin 12.70% +1.0 basis point
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(5 of 10 reporting) +24.7% -9.2 percentage points
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 372.42 +1.32: Growth Rate +30.8% +.5 percentage point, P/E 31.3 -1.3
  • Bloomberg US Financial Conditions Index .75 unch.
  • Bloomberg Euro-Zone Financial Conditions Index 1.15 -1.0 basis point
  • US Yield Curve 10.75 basis point (2s/10s) -.75 basis point
  • US Atlanta Fed Q4 GDPNow Forecast +2.66% -13.0 basis points
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 41.5% -.4 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.74% +12.0 basis points: CPI YoY +2.56% unch.
  • 10-Year TIPS Spread 2.33 -1.0 basis point
  • Highest target rate probability for Dec. 18th FOMC meeting: 75.5%(+3.3 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Jan. 29th meeting: 45.3%(+.6 percentage point) chance of 4.0%-4.25%. (current target rate is 4.75-5.0%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating -676 open in Japan 
  • China A50 Futures: Indicating +21 open in China
  • DAX Futures: Indicating +108 open in Germany
Portfolio:
  • Lower:  On losses in my tech/industrial/biotech/consumer discretionary sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

Bear Radar

Style Underperformer:

  • Large-Cap Growth -2.5%
Sector Underperformers:
  • 1) Semis -4.5% 2) Software -3.7% 3) Road and Rail -3.0%
Stocks Falling on Unusual Volume: 
  • ALTR, EQNR, DINO, META, IRTC, NNN, CVE, CHRW, EG, CRK, MET, BUD, XYL, WEN, CVI, SIMO, ICE, H, HVT, AR, MIDD, SPXC, EBAY, IDXX, FTAI, EBAY, IONQ, GRBK, REGN, MXL, CWH, OLED, UBER, OTEX, HUT, ARW, MGM, HUT, FORM, SNN, SMCI, LI, MGPI, COIN, GEL, NSIT, WSC, TFX, MAX, HOOD, ACHC, SN, MPWR, EL, APRTV, ROKU and HII
Stocks With Unusual Put Option Activity:
  • 1) BHC 2) WEN 3) MCHI 4) NXT 5) ROKU
Stocks With Most Negative News Mentions:
  • 1) HOOD 2) ACHC 3) NVRI 4) EL 5) SMCI
Sector ETFs With Most Negative Money Flow:
  • 1) SOXX 2) XLB 3) SMH 4) XLY 5) JETS

Bull Radar

Style Outperformer:

  • Large-Cap Growth +.9%
Sector Outperformers:
  • 1) Utilities +1.6% 2) Shipping +.9% 3) Oil Service +.9%
Stocks Rising on Unusual Volume:
  • ROOT, LMND, PAYC, CVNA, AVDL, NXT, SXC, RBLX, OSPN, TWLO, CFLT, MDGL, MATX, ETR, RELY, KTB, TTMI, MYRG, IP, FDP, LAUR, IMAX, GEN, DNB, NVST, MCS, MBLY, ETSY, GPCR, BTU, VNT, WCC, UTZ, SFM, AME, ITRI, LPLA, GPRE, MO, NCLH, SNBR, FPI, ZEL, RVMD, SCI, PEN, COP, MRO, PCTY, JKS, BAND, ARGX, HLI, MBUU, MMSI, BKNG, DRVN, COLM, LNG, LAZ, SDRL, LNC, PHIN, CORT, OGN, WTW, BMY, CNNE, GVA, VAL, ALK and GDDY
Stocks With Unusual Call Option Activity:
  • 1) IGT 2) NXT 3) LMND 4) IP 5) ALK
Stocks With Most Positive News Mentions:
  • 1) CVNA 2) TWLO 3) CFLT 4) RELY 5) NCLH
Sector ETFs With Most Positive Money Flow:
  • 1) XLI 2) XAR 3) XLE 4) XLF 5) VGT
Charts:

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

Earnings of Note 
Company/Estimate 

Before the Open:
  • (ARCB)/1.85
  • (CAH)/1.62
  • (CBOE)/2.19
  • (CHTR)/8.66
  • (CVX)/2.43
  • (CHD)/.68
  • (D)/.93
  • (XOM)/1.88
  • (LYB)/1.98
  • (MGA)/1.39
  • (PPL)/.43
  • (RBC)/2.29
  • (SPG)/3.03
  • (TROW)/2.34
  • (WAT)/2.68
  • (W)/.13
After the Close: 
  • None of note
Economic Releases

8:30 am EST

  • The Change in Non-Farm Payrolls for Oct. is estimated to fall to 105K versus 254K in Sept.
  • The Unemployment Rate for Oct. is estimated at 4.1% versus 4.1% in Sept.
  • Average Hourly Earnings MoM for Oct. is estimated to rise +.3% versus a +.4% gain in Sept. 

 9:45 am EST

  • Final Global US Manufacturing PMI reading for Oct.

10:00 am EST

  • Construction Spending MoM for Sept. is estimated unch. versus a -.1% decline in Aug.
  • ISM Manufacturing for Oct. is estimated to rise to 47.6 versus 47.2 in Sept.
  • ISM Prices Paid for Oct. is estimated to rise to 50.0 versus 48.3 in Sept.

Afternoon

  • Wards Total Vehicle Sales for Oct. is estimated to rise to 15.8M versus 15.77M in Sept.

Upcoming Splits

  • None of note
Other Potential Market Movers
  • The Atlanta Fed Q4 GDPNow update, Dallas Fed PCE for Sept., weekly US Baker Hughes rig count and the weekly CFTC net positioning reports could also impact global trading tomorrow.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

  • Volume Running +20.3% Above 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 11.7 -3.5
  • 8 Sectors Declining, 3 Sectors Rising
  • 31.7% of Issues Advancing, 66.5% Declining 
  • TRIN/Arms .84 -12.5%
  • Non-Block Money Flow -$161.9M
  • 69 New 52-Week Highs, 61 New Lows
  • 56.3% (-3.2%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 59.0 -3.0
Other:
  • Bloomberg Global Risk-On/Risk-Off Index 61.4 -3.0%
  • Bloomberg Cyclicals/Defensives Index 230.8 -1.3%
  • Russell 1000: Growth/Value 19,944.8 -2.0%
  • CNN Fear & Greed Index 47.0 (NEUTRAL) -14.0
  • 1-Day Vix 14.8 +8.7%
  • Vix 22.4 +10.0%
  • Total Put/Call .84 -6.7%