Style Underperformer:
Sector Underperformers:
- 1) Papers -2.82% 2) Alt Energy -1.81% 3) REITs -1.16%
Stocks Falling on Unusual Volume:
- RNF, CYOU, AMCX, SDR, SOHU, NS, ROP, RIG, PER, JKS, CLVS, ADUS, EW, BITA, NOAH, YY, CSIQ, AXDX, SYNA, CROX, QIHU, DNKN, TSL, NTES, MEOH, HWAY, FSLR, SBGI and MEI
Stocks With Unusual Put Option Activity:
- 1) DOLE 2) CNX 3) BIIB 4) LYB 5) MMM
Stocks With Most Negative News Mentions:
- 1) CP 2) AMN 3) CAT 4) RIG 5) DOW
Charts:
Style Outperformer:
Sector Outperformers:
- 1) Gold & Silver +1.69% 2) Semis +.38% 3) Agriculture +.36%
Stocks Rising on Unusual Volume:
- FRM, BMY, FIO, PBR and VNTV
Stocks With Unusual Call Option Activity:
- 1) MAS 2) PEP 3) DNDN 4) MDLZ 5) GLUU
Stocks With Most Positive News Mentions:
- 1) BKC 2) BMY 3) CF 4) MCD 5) WMT
Charts:
Weekend Headlines
Bloomberg:
- Abe Warns China on Island Spat as Japan Dispatches Fighter Jets. Prime
Minister Shinzo Abe warned he
wouldn’t permit China to use force to resolve territorial spats, as the
renewed presence of Chinese aircraft near disputed islands prompted the
dispatch of fighter jets from Japan. Japan sent up fighter jets for a third day yesterday after Chinese aircraft flew between its southern islands without
entering Japanese airspace, the Self-Defense Forces said on
their website. Abe said yesterday the country would not allow
any shift in the status quo regarding islands both governments
claim in the East China Sea. Abe made similar comments in an
interview with the Wall Street Journal on Oct. 25.
- China Seen Losing Sheen for IBM(IBM) to Nike(NKE) as Hurdles Mount. Companies
from IBM to Starbucks are struggling with new obstacles in
China as Communist Party officials tussle over the direction and depth
of economic reforms. China’s state-controlled media last week accused
Starbucks Corp. with charging too much for coffee and said Samsung
Electronics Co.’s smartphones don’t work properly. International
Business Machines Corp. IBM’s China revenue slipped 22 percent in the
third quarter, contributing to the first-ever sales decline in the
company’s
growth-markets division, as state-owned companies started delaying
orders, including mainframes and servers.
- Hong Kong Home Prices to Drop 30% by 2015-End, Barclays Says. Hong
Kong home prices will drop 30 percent by the end of 2015 as growth in
household income and rents slow while housing supply increases,
according to Barclays Plc. The bank is assigning a “negative” rating on the Hong
Kong property sector, analysts Paul Louie and Zita Qin wrote in
a report today. They also forecast office prices to fall 20
percent and retail property prices to remain unchanged over the
period, according to the report.
- Asian Stocks Post Weekly Decline on China Bank Rates, Earnings. Asian
stocks posted the biggest weekly decline since August after forecasts
from Canon Inc. to Japan Exchange Group Inc. disappointed investors and
money-market rates in China surged. Japan Exchange sank 5.8 percent in Tokyo this week after the main bourse operator in the world’s second-largest equity
market failed to boost full-year profit guidance as analysts had
expected.
- Asia Stocks Rise on Fed Bets.
Asian stocks rose, with the regional equities gauge rebounding from
last week’s decline, after weaker than forecast U.S. consumer confidence
spurred bets the Federal Reserve will maintain stimulus. CSL Ltd.
(CSL), a maker of blood-derived therapies that gets more than a third of
its sales in the U.S., advanced 2.9 percent in Sydney. Toyota Motor
Corp. gained 1 percent in Tokyo as the yen weakened against the dollar,
boosting the earnings outlook for Asia’s largest carmaker. Kingsgate
Consolidated Ltd. fell 4.7 percent in Sydney as the gold miner reported
an 18 percent drop
in quarterly output. The MSCI Asia Pacific Index gained 0.7 percent to 142.36 as
of 10:49 a.m. in Tokyo, with all 10 industry groups on the gauge
rising.
- Rebar Swings as Investors Weigh China Inventory, Winter Demand.
Steel reinforcement-bar futures in Shanghai swung between gains and
losses today as investors weighed a decline in inventory against weaker
winter demand. Rebar for delivery in May, the most-active contract by
volume on the Shanghai Futures Exchange, was little changed at
3,584 yuan ($589) a metric ton at 10:15 a.m. local time, after
gaining 0.3 percent and losing 0.2 percent.
- Copper Declines Before U.S. Output Data as China Credit Tightens.
Copper dropped before industrial output data from the U.S. and on
concern that credit is tightening in China. Lead and zinc fell for the
first time in three days. The contract for copper delivery in three
months on the London Metal Exchange dropped 0.2 percent to $7,171.25 a
metric ton at 11:47 a.m. in Tokyo. Futures lost 0.8 percent last week and are down 1.8 percent this month. Lead fell 0.5 percent to
$2,193.50 a ton and zinc slid 0.3 percent to $1,948.75 a ton.
- Euro Jobless Fault Line Festers as Italy Scars Recovery. Euro-area
jobless numbers this week may lay bare a fault line scarring the
region’s recovery as evidence of Germany’s employment muscle contrasts
with the scourge of political quagmire destroying work in Italy. While
the currency bloc’s longest-ever recession has ended, unemployment held
at 12 percent in September, according to the median of 36 forecasts
in a Bloomberg survey of economists. Within that data lies a rift
between two of its largest economies, with Italy’s rate seen by
economists to have reached 12.3 percent, the highest since records began
in 1977 -- and more than double Germany’s comparable level. Italy
will “critically determine the fate of the euro area” and the region
won’t prosper if that country can’t restore economic growth, European
Central Bank Executive Board member Joerg Asmussen said last week. Italian officials predict joblessness in the euro zone’s third-biggest economy will keep rising, against a backdrop of a fragmented coalition jeopardized by the legal woes of former premier Silvio Berlusconi. “We
are still in a very discouraging situation for most of the euro area,”
said Anatoli Annenkov, an economist at Societe Generale SA in London. “That’s particularly true for Italy,
where politics has come to a rest and necessary structural
reforms are not kicking in at all.”
- Fed Loan Warning May Hurt Riskiest Borrowers, Trade Group Says. Recommendations by top banking
regulators that lenders strengthen underwriting standards for
leveraged loans may decrease funding to the neediest borrowers,
according to Loan Syndications and Trading Association. The Federal Reserve and the Office of the Comptroller of
the Currency sent letters to some of the biggest U.S. banks
asking them to avoid arranging debt that may be classified by
regulators as having some deficiency that may result in a loss,
according to nine people with knowledge of the communication.
Wall Street Journal:
- Big Banks Are Padding Profits With 'Reserve' Cash. As Revenue Slows, Some Banks Increasingly Use Loan-Loss Reserves to Boost Income.
Federal regulators have warned banks to be careful about padding their
profits with money set aside to cover bad loans. But some of the
nation's biggest banks did more of it in the third quarter than earlier
this year. J.P. Morgan Chase JPM +0.55% & Co., Wells Fargo WFC
+0.40% & Co., Bank of America Corp. BAC +0.64% and Citigroup
Inc., C -0.18% the nation's largest banks by assets, tapped a total of
$4.9 billion in loan-loss reserves in the third quarter, up by about a
third from both the second quarter and the year-ago quarter after
adjustments.
All the banks except Citigroup showed significant increases compared
with the second quarter.
Fox News:
- 'Grand Day of Death to America' rally planned in Iran. Militant factions in Iran are reportedly planning a sweeping rally
titled, “Grand Day of Death to America,” to coincide with the 24th
anniversary of the storming of the U.S. Embassy there. According to The National, Brigadier General Masoud Jazayeri is
saying the planned Nov. 4 convocation outside the long-shuttered and
now-graffiti-covered diplomatic institution in the capitol city of
Tehran will be organized by a newly created bureaucratic body called the
“Death to the U.S. Committee.”
CNBC:
- Hilsenrath to Wall Street: You don’t know Fed.
Investors may be right to anticipate that no bombshells will emerge
from the Federal Reserve meeting this week—but as they look into next
year, it will be very difficult to predict when the Fed will begin to
taper its quantitative easing program, Jon Hilsenrath told "Futures
Now."
Business Insider:
American Thinker:
Washington Post:
- Wave of attacks hits Baghdad and northern Iraq, killing at least 66 in series of assaults. A series of attacks including car bombings in Baghdad, an explosion
at a market and a suicide assault in a northern city killed at least 66
people Sunday across Iraq, officials said, the latest in a wave of
violence washing over the country. Coordinated bombings hit Iraq multiple times each month,
feeding a spike in bloodshed that has killed more than 5,000 people
since April. The local branch of al-Qaida often takes responsibility for
the assaults, although there was no immediate claim for Sunday’s
blasts.
The Blaze:
Reuters:
USA Today:
- Israel issues warning on report on Iran bomb.
A new report that says Iran may need as little as a month to produce
enough uranium for a nuclear bomb is further evidence for why Israel
will take military action before that happens, an Israeli defense
official said Friday. "We have made it crystal clear – in all
possible forums, that Israel will not stand by and watch Iran develop
weaponry that will put us, the entire Middle East and eventually the
world, under an Iranian umbrella of terror," Danny Danon, Israel's
deputy defense minister told USA TODAY. Iran is developing and
installing new and advanced centrifuges that enable Iran to enrich even
low-enriched uranium to weapons grade uranium needed for nuclear weapons
within weeks, Danon said. "This speedy enrichment capability
will make timely detection and effective response to an Iranian nuclear
breakout increasingly difficult," he said. "Breakout" refers to the
time needed to convert low-enriched uranium to weapons-grade uranium. On
Thursday, the Institute for Science and International Security issued a
report stating that Iran could reach that breakout in as little as one
month based in part on Iran's own revelations about its nuclear program.
"If they use all their centrifuges ... and their stockpiles of low-
and medium-enriched uranium, that would take one to 1.6 months," said
David Albright, president of the institute and a former inspector for
the U.N. International Atomic Energy Agency.
Focus:
- Schaeuble Says Debt, Taxes Can't Rise With New Government. No
additional debt, no increase in taxes core to financial policy of
Chancellor Angela Merkel's bloc, German Finance Minister Wolfgang
Schaeuble said in an interview.
Weekend Recommendations
Barron's:
- Bullish commentary on (FRM), (WAG) and (KSS).
- Bearish commentary on (STP) and (MCD).
Night Trading
- Asian indices are unch. to +.75% on average.
- Asia Ex-Japan Investment Grade CDS Index 133.0 -2.0 basis points.
- Asia Pacific Sovereign CDS Index 100.25 -.5 basis point.
- NASDAQ 100 futures +.36%.
Morning Preview Links
Earnings of Note
Company/Estimate
Economic Releases
9:15 am EST
- Industrial Production for September is estimated to rise +.4% versus a +.4% gain in August.
- Capacity Utilization for September is estimated to rise to 78.0% versus 77.8% in August.
- Manufacturing Production for September is estimated to rise +.3% versus a +.7% gain in August.
10:00 am EST
- Pending Home Sales for September are estimated unch. versus a -1.6% decline in August.
10:30 am EST
- Dallas Fed Manufacturing Activity for October is estimated to fall to 9.0 versus 12.8 in September.
Upcoming Splits
Other Potential Market Movers
- The China Leading Indicators report and the 2Y T-Note auction could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by automaker and industrial
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 week.
Wall St. Week Ahead by Reuters.
Stocks to Watch Monday by MarketWatch.
Weekly Economic Calendar by Briefing.com.
BOTTOM LINE: I expect US stocks to finish the week modestly lower on rising global
growth fears, profit-taking, technical selling, rising
eurozone/emerging markets debt angst, more shorting and earnings
concerns. My intermediate-term trading indicators are giving neutral
signals and the Portfolio is 50% net long heading into the week.
S&P 500 1,759.77 +.88%*
The Weekly Wrap by Briefing.com.
*5-Day Change
Indices
- Russell 2000 1,118.34 +.32%
- S&P 500 High Beta 28.64 +.31%
- Wilshire 5000 18,522.14 +.77%
- Russell 1000 Growth 821.09 +1.09%
- Russell 1000 Value 887.03 +.53%
- Morgan Stanley Consumer 1,055.68 n/a
- Morgan Stanley Cyclical 1,379.53 +2.0%
- Morgan Stanley Technology 846.07 -.12%
- Transports 7,009.05 +2.61%
- Bloomberg European Bank/Financial Services 107.54 +2.13%
- MSCI Emerging Markets 42.62 -1.25%
- HFRX Equity Hedge 1,142.04 +.34%
- HFRX Equity Market Neutral 943.35 +.08%
Sentiment/Internals
- NYSE Cumulative A/D Line 195,890 +1.46%
- Bloomberg New Highs-Lows Index 632 -356
- Bloomberg Crude Oil % Bulls 16.13 +22.57%
- CFTC Oil Net Speculative Position 315,438 -1.66%
- CFTC Oil Total Open Interest 1,856,649 -1.30%
- Total Put/Call .92 +35.29%
- ISE Sentiment 90.0 +11.11%
- Volatility(VIX) 13.09 +.38%
- S&P 500 Implied Correlation 37.21 +3.16%
- G7 Currency Volatility (VXY) 7.58 -.66%
- Emerging Markets Currency Volatility (EM-VXY) 8.02 -4.30%
- Smart Money Flow Index 11,787.50 +.85%
- Money Mkt Mutual Fund Assets $2.668 Trillion +2.09%
Futures Spot Prices
- Reformulated Gasoline 258.71 -2.90%
- Bloomberg Base Metals Index 191.42 -.76%
- US No. 1 Heavy Melt Scrap Steel 335.67 USD/Ton -.06%
- China Iron Ore Spot 133.30 USD/Ton -.82%
- UBS-Bloomberg Agriculture 1,429.96 -1.15%
Economy
- ECRI Weekly Leading Economic Index Growth Rate 2.0% -80 basis points
- Philly Fed ADS Real-Time Business Conditions Index -.1482 +9.85%
- S&P 500 Blended Forward 12 Months Mean EPS Estimate 118.91 +.06%
- Citi US Economic Surprise Index 17.0 -6.2 points
- Citi Emerging Markets Economic Surprise Index -5.60 +4.0 points
- Fed Fund Futures imply 34.0% chance of no change, 66.0% chance of 25 basis point cut on 10/30
- US Dollar Index 79.19 -.52%
- Euro/Yen Carry Return Index 140.20 +.51%
- Yield Curve 221.0 -5 basis points
- 10-Year US Treasury Yield 2.51% -7 basis points
- Federal Reserve's Balance Sheet $3.796 Trillion +.68%
- U.S. Sovereign Debt Credit Default Swap 37.47 +10.15%
- Illinois Municipal Debt Credit Default Swap 180.0 -1.09%
- Western Europe Sovereign Debt Credit Default Swap Index 69.0 -3.25%
- Asia Pacific Sovereign Debt Credit Default Swap Index 100.21 -2.65%
- Emerging Markets Sovereign Debt CDS Index 215.37 +3.79%
- Israel Sovereign Debt Credit Default Swap 108.50 -.30%
- Egypt Sovereign Debt Credit Default Swap 685.0 +1.32%
- China Blended Corporate Spread Index 372.0 +9 basis points
- 10-Year TIPS Spread 2.19% +1 basis point
- TED Spread 20.75 -1.25 basis points
- 2-Year Swap Spread 12.75 -.5 basis point
- 3-Month EUR/USD Cross-Currency Basis Swap -3.75 +2.75 basis points
- N. America Investment Grade Credit Default Swap Index 72.08 +1.64%
- European Financial Sector Credit Default Swap Index 125.37 +4.1%
- Emerging Markets Credit Default Swap Index 261.66 +1.77%
- CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 112.50 -.5 basis point
- M1 Money Supply $2.652 Trillion +3.92%
- Commercial Paper Outstanding 1,061.90 +2.70%
- 4-Week Moving Average of Jobless Claims 348,300 +11,800
- Continuing Claims Unemployment Rate 2.2% unch.
- Average 30-Year Mortgage Rate 4.13% -15 basis points
- Weekly Mortgage Applications 454.50 -.57%
- Bloomberg Consumer Comfort -36.10 -2.0 points
- Weekly Retail Sales +3.0% -20 basis points
- Nationwide Gas $3.32/gallon -.04/gallon
- Baltic Dry Index 1,708 -12.86%
- China (Export) Containerized Freight Index 1,010.07 unch.
- Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 27.50 unch.
- Rail Freight Carloads 264,687 +1.48%
Best Performing Style
Worst Performing Style
Leading Sectors
Lagging Sectors
Weekly High-Volume Stock Gainers (26)
- XTXI, BABY, APOL, CSII, FDML, CLGX, MDVN, WBCO, GLW, TPH, COLE, IVC, MANH, EHTH, GNTX, DV, BREW, TCBI, TIVO, HMTV, KRO, ATHN, CPLA, GNC, HXL and FBC
Weekly High-Volume Stock Losers (27)
- UPL, GLF, FFIV, HSTM, CMRX, ANAC, HPTX, ASTE, COH, GIMO, ABAX, VNTV, LAD, ABG, STML, ALTR, USNA, PETS, AKAM, VCI, MCRI, FTI, CSH, CVA, ACAT, CAM and RPRX
Weekly Charts
ETFs
Stocks
*5-Day Change
