Weekly Outlook

• Wall St. Week Ahead by Reuters. 
• Week Ahead by TheStreet.
• Stocks to Watch Next Week by Seeking Alpha.
• Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week modestly higher on tax reform hopes, yen weakness, earnings outlooks, technical buying, short-covering and economic optimism. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 100% net long heading into the week.

Today's Headlines

Bloomberg:

• For Catalans, the Question Is Compliance or Defiance of Madrid. Normal weekend routines like shopping, soccer and strolling prevailed in Catalonia even as the first test of Spanish Prime Minister Mariano Rajoy’s decision to take over the breakaway region approached, with Catalans weighing compliance versus defiance. When schools and government offices open Monday, teachers and civil servants will decide whether to follow the ousted Catalan leaders’ calls to resist their Spanish masters or acquiesce to the new reality. A smooth transition in the Catalan police force, with the new chief accepting Madrid’s rule, marked an initial success for Rajoy.

• House Tax Writer Gives Ground on State and Local Tax Break. Bowing to concerns from Republican House members in high-tax states, the chamber’s chief tax writer said he’ll preserve a federal income-tax break for property taxes. “At the urging of lawmakers, we are restoring an itemized property tax deduction to help taxpayers with local tax burdens,” House Ways and Means Chairman Kevin Brady said in a statement Saturday afternoon.

• Oil Investors Roll the Dice on OPEC After Saudi Prince Ups the Ante. The OPEC trade is back, and Saudi Arabia is in the driver’s seat. Just before the de facto OPEC leader doubled down on its plan to drain the oil glut, propelling Brent crude prices beyond $60 a barrel for the first time since 2015, hedge funds were almost as bullish on the global benchmark as they’ve ever been. Short-sellers retreated to levels last seen in February, when OPEC production cuts were fueling an oil price surge.

• The FANG Health Scare Ends With a Bang. (video) All year, people have wondered if something was wrong with the market. Volatility was gone, stocks hardly moved. On Friday, they moved, though maybe not in the direction everyone was expecting. Not content with all the tiny gains that were lifting equities toward the best year since 2013, traders emboldened by a scorching dose of tech earnings sent the Nasdaq 100 Index to its biggest rally in 19 months. About $185 billion was added to the market cap of the five largest companies alone, a rally reminiscent of the glory days of the tech bubble. The surge ended a brief bout of nerves caused by a run of down days in technology megacaps. It left the Nasdaq 100 up 28 percent in 2017, its best performance relative to the S&P 500 Index since the start of the bull run.

Wall Street Journal: 

• First Charges Filed in Russia Probe Led by Special Counsel Robert Mueller. At least one defendant is expected to be taken into custody as soon as Monday.

• Trump Likely to Name Jerome Powell Next Fed Chairman—Source. Decision not final but at this point he has settled on Mr. Powell as selection.

• Saudis Back More Supply Cuts in Support of Oil Prices. Statement strongly suggests OPEC will agree to continuing production curb at its next meeting.

Barron's:

• Had bullish commentary on (CELG), (MSFT), (ORCL), (CSCO), (BABA), (TGT), (SHPG), (BIIB), (AMGN) and (GILD).

MarketWatch.com:

• Show your children that experiences are more valuable than things (and other ways to raise smart kids).

• Could a CVS(CVS)-Aetna(AET) deal actually benefit consumers?

Fox News:

• George Washington's Church Says Plaque Honoring First President Must Come Down.

CNBC:

• Why Amazon(AMZN), Alphabet(GOOG), Microsoft(MSFT) and Intel(INTC) are still buys after monster earnings reports.

• There are now more than 120 hedge funds focused solely on bitcoin, digital currencies.

Zero Hedge:

• Trump To Release "All JFK Files" After Latest Clash With Spy Agencies.

• Catalan Leader Urges "Peaceful" Rebellion As Spain Takes Over Government.

• Hannity Reacts To Mueller Probe Charges: "When Will Hillary Clinton Be Indicted?".

• The One Paragraph You Need To Read From The JFK Assassination Files That May Change Everything.

• Bill Miller Put 30% Of His Fund's Assets In Bitcoin.

• Obama's IRS Admits To Specifically Targeting Tea Party Conservatives.

• Mnuchin Says White House Is "Focused On Finding A Successor To Yellen".

• Mueller Reportedly Ready To File First Charges In Russia Probe.

• J. Edgar Hoover: "Need To Convince Public That Oswald Is Real Assassin".

• The Government Has Created Every Step In The Development Of The Opiod Crisis.

• Frustrated Trump Urges State To Release Remaining Clinton Emails.

• False Flag Terrorist Bombings, Murder Plots, And More: The Stunning Revelations In The JFK Assassination Files.

• Even Obama's CIA Director Thinks Clinton's Dossier Payments Need To Be Investigated.

• Bannon Declares War On "Phony Culture Brokers" In Hollywood Who "Turned A Blind Eye" To Weinstein.

• Weekend Reading: Markets Love Central Banks - No Matter What They Do.

• Bezos Beat Batters Bears But Bonds & Bullion Bounce. (graph)

Business Insider:

• The Hallmark Channel is defying every trend in media by owning Christmas.

• All 15 new Netflix(NFLX) original TV shows and movies coming out in November.

• James Toback says allegations of sexual assault against him are 'too stupid' and 'not worth talking about'.

• George Clooney’s latest directing effort is embarrassingly awful. 

• WSJ editorial board calls for Mueller's resignation and accuses Clinton and DNC of collusion.

• E-sports just got closer to being part of the Olympics.

• Apple(AAPL) is shipping many iPhone X preorders sooner than expected.

Weekly Scoreboard*

S&P 500 2,580.84 +.21%

The Weekly Wrap by Briefing.com.

 
Indices

• DJIA 23,434.60 +.40%

• NASDAQ 6,701.81 +.95%

• Russell 2000 1,505.55 -.22%

• S&P 500 High Beta 40.15 -1.16%

• Goldman 50 Most Shorted 135.60 -1.21%

• Wilshire 5000 26,731.90 +.09%

• Russell 1000 Growth 1,304.41 +.86%

• Russell 1000 Value 1,179.87 -.58%

• S&P 500 Consumer Staples 546.50 -1.55%

• Vanda Cyclicals-Defensives 1.3923 +1.24%
  

• NYSE Technology 1,672.34 +1.53%

• Transports 9,920.68 -.50%

• Utilities 750.80 +.27%

• Bloomberg European Bank/Financial Services 101.47 -.21%

• MSCI Emerging Markets 45.80 -.69%

• HFRX Equity Hedge 1,243.39 -.21%

• HFRX Equity Market Neutral 1,012.23 +.39%

Sentiment/Internals

• NYSE Cumulative A/D Line 307,026 -.47%

• Bloomberg New Highs-Lows Index 313 +79

• Bloomberg Crude Oil % Bulls 43.75 +16.7%

• CFTC Oil Net Speculative Position 429,525 +2.99%

• CFTC Oil Total Open Interest 2,440,472 +.12%

• Total Put/Call .85 +2.44%

• OEX Put/Call .66 +17.3%

• ISE Sentiment 147.0 +20.5%

• NYSE Arms 1.15 +26.0%

• Volatility(VIX) 9.93 +.4%

• S&P 500 Implied Correlation 16.60 +14.77%

• G7 Currency Volatility (VXY) 7.70 -.13%

• Emerging Markets Currency Volatility (EM-VXY) 8.32 +2.97%

• Smart Money Flow Index 19,993.36 -.54%

• ICI Money Mkt Mutual Fund Assets $2.748 Trillion +.13%

• ICI US Equity Weekly Net New Cash Flow -$3.118 Billion

• AAII % Bulls 39.6 +4.5%

• AAII % Bears 33.0 +18.3%

Futures Spot Prices

• CRB Index 186.83 +1.33%

• Crude Oil 53.80 +3.91%

• Reformulated Gasoline 177.11 +4.57%

• Natural Gas 2.75 -3.57%

• Heating Oil 187.20 +3.12%

• Gold 1,271.80 -.80%

• Bloomberg Base Metals Index 202.17 -2.21%

• Copper 310.20 -2.15%

• US No. 1 Heavy Melt Scrap Steel 258.33 USD/Metric Tonne unch.

• China Iron Ore Spot 60.08 USD/Ton -3.81%

• Lumber 450.90 +5.65%

• UBS-Bloomberg Agriculture 1,027.62 +.96%

Economy

• Atlanta Fed GDPNow Forecast +2.5% -20.0 basis points

• ECRI Weekly Leading Economic Index Growth Rate 2.8% +50.0 basis points
  

• Philly Fed ADS Real-Time Business Conditions Index -.1052 +3.58% 

• US Economic Policy Uncertainty Index 185.13 +69.8%

• S&P 500 Blended Forward 12 Months Mean EPS Estimate 142.42 +.23%

• Citi US Economic Surprise Index 38.2 +36.7 points

• Citi Eurozone Economic Surprise Index 59.50 +5.4 points

• Citi Emerging Markets Economic Surprise Index 21.30 +4.1 points

• Fed Fund Futures imply 85.5% chance of no change, 14.5% chance of 25 basis point hike on 11/1

• US Dollar Index 94.97 +1.45%

• MSCI Emerging Markets Currency Index 1,623.38 -.37%

• Euro/Yen Carry Return Index 137.58 -1.29%

• Yield Curve 83.0 +2.0 basis points
  

• 10-Year US Treasury Yield 2.43% +5.0 basis points

• Federal Reserve's Balance Sheet $4.422 Trillion -.19%

• U.S. Sovereign Debt Credit Default Swap 24.78 -.02%

• Illinois Municipal Debt Credit Default Swap 337.82 -.05%

• Western Europe Sovereign Debt Credit Default Swap Index 4.68 +.21%

• Asia Pacific Sovereign Debt Credit Default Swap Index 15.57 -.06%
  

• Emerging Markets Sovereign Debt CDS Index 44.48 +12.4%
  

• Israel Sovereign Debt Credit Default Swap 48.03 -1.67%

• South Korea Sovereign Debt Credit Default Swap 71.65 +3.99%

• Russia Sovereign Debt Credit Default Swap 129.76 -.67%

• iBoxx Offshore RMB China Corporate High Yield Index 144.76 +.1%

• 10-Year TIPS Spread 1.90% +2.0 basis points

• TED Spread 28.5 +2.0 basis points

• 2-Year Swap Spread 22.75 -1.5 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -42.0 -1.25 basis points

• N. America Investment Grade Credit Default Swap Index 53.49 +1.75%

• America Energy Sector High-Yield Credit Default Swap Index 399.0 +3.32%

• European Financial Sector Credit Default Swap Index 54.47 -7.99%
  

• Emerging Markets Credit Default Swap Index 174.79 +1.84%
  

• CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 154.0 -1.0 basis point
  

• M1 Money Supply $3.578 Trillion -.4%

• Commercial Paper Outstanding 1,067.30 +.5%

• 4-Week Moving Average of Jobless Claims 239,500 -8,750

• Continuing Claims Unemployment Rate 1.3% unch.
  

• Average 30-Year Mortgage Rate 3.88% -3.0 basis points

• Weekly Mortgage Applications 400.3 -4.62%

• Bloomberg Consumer Comfort 51.0 -.1 point

• Weekly Retail Sales +3.4% unch.

• Nationwide Gas $2.47/gallon +.o1/gallon

• Baltic Dry Index 1,555.0 -1.46%

• China (Export) Containerized Freight Index 775.54 +.42%

• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 27.50 unch.

• Rail Freight Carloads 291,046 +2.44%

Best Performing Style

• Large-Cap Growth +.9%

Worst Performing Style

• Mid-Cap Value -.7%

Leading Sectors

• Software +3.3%

• Homebuilding +2.3%

• Road & Rail +2.1%

• Semis +2.0%

• Construction +1.9%

Lagging Sectors

• Oil Service -3.7% 

• Drugs -3.9%

• Gold & Silver -4.4%

• Airlines -4.5%

• Biotech -5.4%

Weekly High-Volume Stock Gainers (24)

• SKX, NEOS, OSTK, EXAC, TUSK, DYN, TLRD, AIMT, CAI, PII, GRUB, TWTR, STX, BWLD, KNL, USNA, MHO, GPK, SCOR, MGNX, UHAL,GLW, DEL and SEM

Weekly High-Volume Stock Losers (27)

• MNRO, MDSO, CWH, IBKC, EW, LHO, AAXN, WHR, GE, CHTR, LBRDA, ALXN, WMK, CVLT, SFLY, NCR, CMG, CUBI, HNI, IRBT, TACO, BC, AXE, OII, CELG, ACHC and OMER

Weekly Charts

ETFs

• High-Volume Gainers

• High-Volume Losers

Stocks

• High-Volume Gainers

• High-Volume Losers

*5-Day Change