Weekly Outlook

• Week Ahead on Wall Street by CNBC. (video)
• Wall St. Week Ahead by Reuters. 
• Stocks to Watch Next Week by Seeking Alpha.
• Weekly Economic Calendar by Briefing.com.

BOTTOM LINE: I expect US stocks to finish the week mixed as oil gains, positive earnings outlooks and economic optimism offset profit-taking, technical selling and yen strength. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 100% net long heading into the week.

Today's Headlines

Bloomberg:

• China's Growth Data to Set Tone for Emerging Markets This Week.

• Seoul's Painful Stock Tax. Along with North Korean leader Kim Jong Un's saber rattling, foreign investors with an eye on South Korea may soon face another problem: higher taxes.

• Asia Set for Equity Gains on Economic Optimism. Futures on stock indexes in Japan, Australia, South Korea and Hong Kong all rose. U.S. markets are shut Monday for the Martin Luther King Jr. holiday after the S&P 500 Index closed on Friday at a fresh all-time high. Retail sales spurred optimism in the American economy and JPMorgan Chase & Co. signaled tax cuts will boost profits, while an acceleration in core inflation bolstered the case for the Federal Reserve’s path of higher rates. The euro remained near a three-year high against the greenback on bets that central bank stimulus will be pared back further in Europe as its economy mends. Futures on Japan’s Nikkei 225 Stock Average added 0.2 percent in most recent trading, compared with prices from late Friday. Futures on Australia’s S&P/ASX 200 Index and on Hong Kong’s Hang Seng Index advanced 0.5 percent.

• Five Things You Need to Know to Start Your Day.

• Stricken Iranian Oil Tanker Sinks in East China Sea After Blast. (video)

• Republicans See Possible DACA Deal Despite Trump's Twitter Posts. Republicans held out hope that a deal can be reached allowing young undocumented immigrants to remain in the U.S., despite President Donald Trump saying the effort is “probably dead” amid growing tensions about keeping the government funded past Friday. Trump escalated his rhetoric on immigration in a pair of early-morning Sunday Twitter messages that appeared to move away from what a few days ago seemed to be a potential deal with Democrats and moderate Republicans on legislation to continue the Deferred Action for Childhood Arrivals program.

Wall Street Journal:

• GOP Senator Says Trump Didn’t Use Crude Term to Describe African Nations. Two lawmakers at a meeting where Trump allegedly used the term ‘shithole countries’ call into question his use of the term.

• U.S. Vows to Withdraw From Iran Nuclear Deal Without Major Changes. Trump administration sets the clock ticking on tough negotiations with its European allies. 

• Ford(F) Increasing Electric Vehicle Investment to $11 Billion by 2022. Auto maker’s head of global markets said company is ‘electrifying our iconic vehicles’.

Fox News:

• Greyhound bus chased by police after illegal immigrant threatens passengers.

CNBC:

• A 'big money indicator' is pointing to more record highs for stocks. (video)

• 6 digital health predictions for 2018.

• China to step up banking oversight in 'arduous' fight on financial risks.

• Jamie Dimon walks back Trump one-term prediction, notes Democrats' lack of centrist candidates.

Zero Hedge:

• The Chinese Are Now Spending As Much As Americans.

• Which US Jobs Pay The Highest Bonuses. 

• Big Donors Buffett, Gates Should Worry As FBI Investigates Clintons' "Charity".

• Prince Alwaleed Moved To Highest Security Saudi Prison After Refusing To Pay $6 Billion For Freedom: Report. 

• AntiFa Group Proposes "Law Enforcement Incineration Day".

• US Resumes Accepting DACA Applications As Trump Rages On Twitter .

• Pakistan Threatens India With Nuclear War After Indian Army Chief's Statement.

Business Insider:

• I tried to buy $1 of bitcoin from a Las Vegas ATM — and it just proves how far bitcoin is from replacing regular money.

• 15 companies that are defying the retail meltdown by opening hundreds of new stores.

• MORGAN STANLEY: Britain is edging closer to a 'soft Brexit'.

• Top Republicans are taking aim at a Democratic senator who said Trump made 'shithole countries' comment.

• There's a bitcoin rapper called CoinDaddy, and he's just one of the fantastic characters in San Francisco's bizarre crypto culture.

Today's Headlines

 Bloomberg:

• Abe in Latvia Calls for Pressure on North Korea. The international community should step up pressure on North Korea to help defuse the stand-off over the isolated country’s pursuit of long-range nuclear weapons, Japan’s Prime Minister Shinzo Abe said Saturday during a visit to Latvia. “As the international order founded on the rule of law is being challenged, our two nations need to closely work together to maintain and strengthen the system,” Abe said in a statement after meeting Latvian Prime Minister Maris Kucinskis. The two leaders agreed “on the importance of reinforcing pressure on North Korea,” he said. 

• Iraq Joins U.A.E., Qatar in Call to Keep Oil Cuts. Iraq joined the United Arab Emirates, Qatar and Oman in calling for OPEC and allied producers to stick with their agreement to cut oil output until the end of the year, despite recent price gains.

• Murdoch’s News Corp. Warns Facebook to Avoid ‘Political’ Changes. (video) Rupert Murdoch’s News Corp., publisher of the Wall Street Journal and New York Post, will keep an eye on Facebook Inc.’s news-feed changes “for any signs that the weighting of news sites is politically motivated.”

• Tax Reform to Fuel Rotation to Stocks, JPMorgan's Kolanovic Says. U.S. tax reforms may not have finished boosting stocks yet. Asset allocators should stay strongly overweight equities and underweight government bonds in the near term due to the uptick in global growth and boost to risk-on assets from U.S. fiscal reform, JPMorgan Chase & Co. strategists led by Marko Kolanovic wrote in a note Friday.

• Big Banks Now Need to Figure Out How to Divvy Up Their Tax Windfall. (video)

Wall Street Journal:

• U.S. Vows to Withdraw From Iran Nuclear Deal Without Major Changes. Trump administration sets the clock ticking on tough negotiations with its European allies.

• Parents’ Dilemma: When to Give Children Smartphones.

Barron's:

• Had bullish commentary on (PYPL), (MA), (IT), (PH), (SHW), (PFE), (ABBV), (LLY), (BEN), (BMY), (JNJ), (AAPL), (FB), (AMZN), (GOOGL) and (AMGN).

• Bright Outlook for the Economy and Stocks.

Fox News: 

• Hawaii emergency alert error causes panic, outrage. (video)

CNBC: 

• If a correction strikes, Canaccord’s Tony Dwyer says this ‘monster buy signal’ could erase losses. (video)

• Indonesia central bank warns over cryptocurrencies.

• Amazon(AMZN) lost cloud market share to Microsoft(MSFT) in the fourth quarter: KeyBanc.

• Desperate to get into bitcoin, investors slip into debt.

• Earnings will be the next test for the seemingly unstoppable $30 trillion stock market.

Zero Hedge:

• Residents "Crying And Screaming" After False "ICBM Threat" Alert Rattles Hawaii; Gabbard Slams Trump.

• DOJ Unseals Indictment Involving Uranium One Scandal.

• WSJ Calls For End To Trump Dossier "Silly Season" - Declassify It & Let The Public Decide.

• Alabama Declares State Of Emergency Over Flu Epidemic As Death Toll Rises. 

• Moby's "CIA Friends" Asked Him To Spread Word Of Trump-Russia Collusion On Facebook.

• Kentucky Becomes First State To Adopt Medicaid Work Requirements.

• Bitcoin Mining Fees Soar As China Crackdown Progresses.

• The US Economy: Full Steam Ahead? (graph)

• New Survey Reveals Staggering Number Of People Are Buying BitCoin On Their Credit Cards.

• Vegas Gunman Sent Cryptic Email About "Bumpfire ARs with a 100 Round Magazine" Before Massacre.

• Trump Lawyer Reportedly Paid $130,000 To Keep Porn Star Silent, She Denies.

• Fed Paid $29.3 Billion To Banks 'Not' To Lend In 2017; Gave $80 Billion To Treasury.

• Weekend Reading: What You Do Matters Most.

• Stocks Surge To Best Start In 30 Years; Bitcoin, Bonds & Dollar Battered. (graph) 

Business Insider:

• This Japanese pop group is singing about cryptocurrencies and getting paid in bitcoin.

Weekly Scoreboard*

S&P 500 Index 2,786.24 +1.57%

 
The Weekly Wrap by Briefing.com.

 
Indices

• DJIA 25,803.19 +2.0%

• NASDAQ 7,261.06 +1.75%

• Russell 2000 1,591.97 +2.05%

• S&P 500 High Beta 45.16 +3.27%

• Goldman 50 Most Shorted 147.62 +1.55%

• Wilshire 5000 28,806.69 +1.61%

• Russell 1000 Growth 1,419.05 +1.58%

• Russell 1000 Value 1,262.79 +1.55%

• S&P 500 Consumer Staples 584.75 -.55%

• Vanda Cyclicals-Defensives 1.5704 +3.69%
  

• NYSE Technology 1,795.98 +.96%

• Transports 11,363.70 +4.13%

• Utilities 684.38 -2.05%

• Bloomberg European Bank/Financial Services 105.46 +3.7%

• MSCI Emerging Markets 49.11 +.58%

• HFRX Equity Hedge 1,290.18 +.12%

• HFRX Equity Market Neutral 1,010.37 +.39%

Sentiment/Internals

• NYSE Cumulative A/D Line 316,561 +.66%

• Bloomberg New Highs-Lows Index 1,428 -43

• Bloomberg Crude Oil % Bulls 57.14 +14.3%

• CFTC Oil Net Speculative Position 624,213 -1.3%

• CFTC Oil Total Open Interest 2,479,798 +.80%

• Total Put/Call .72 -21.98%

• OEX Put/Call .33 -62.75%

• ISE Sentiment 100.0 -3.67%

• NYSE Arms .62 -32.98%

• Volatility(VIX) 10.3 +10.2%

• S&P 500 Implied Correlation 32.13 -9.04%

• G7 Currency Volatility (VXY) 7.10 +4.3% 

• Emerging Markets Currency Volatility (EM-VXY) 7.53 -.92%

• Smart Money Flow Index 20,507.76 +2.14%

• ICI Money Mkt Mutual Fund Assets $2.836 Trillion -.07%

• ICI US Equity Weekly Net New Cash Flow -$14.107 Billion

• AAII % Bulls 48.7 -18.5%

• AAII % Bears 25.1 +61.1%

Futures Spot Prices

• CRB Index 196.06 +1.26%

• Crude Oil 64.36 +4.24%

• Reformulated Gasoline 185.14 +3.11%

• Natural Gas 3.19 +14.5%

• Heating Oil 208.75 +1.09%

• Gold 1,338.90 +1.42%

• Bloomberg Base Metals Index 211.59 +.02%

• Copper 322.35 -.25%

• US No. 1 Heavy Melt Scrap Steel 290.0 USD/Metric Tonne unch.

• China Iron Ore Spot 511.50 CNY/100 Metric Tonnes +1.59%

• Lumber 466.90 +1.33%

• UBS-Bloomberg Agriculture 1,002.80 -1.71%

Economy

• Atlanta Fed GDPNow Forecast +2.8% +10.0 basis points

• ECRI Weekly Leading Economic Index Growth Rate 3.3% -20.0 basis points
  

• Philly Fed ADS Real-Time Business Conditions Index -.0762 +1.17% 

• US Economic Policy Uncertainty Index 225.61 +33.3%

• S&P 500 Blended Forward 12 Months Mean EPS Estimate 151.45 +2.56%

• Citi US Economic Surprise Index 70.40 -4.6 points

• Citi Eurozone Economic Surprise Index 58.30 +12.3 points

• Citi Emerging Markets Economic Surprise Index 6.4 +6.7 points

• Fed Fund Futures imply 82.0% chance of no change, 18.0% chance of 25 basis point hike on 1/31

• US Dollar Index 90.97 -1.02%

• MSCI Emerging Markets Currency Index 1,687.88 -.28%

• Bitcoin/USD 13,764.80 -19.25%

• Euro/Yen Carry Return Index 140.94 -.73%

• Yield Curve 55.0 +3.25 basis points
  

• 10-Year US Treasury Yield 2.55% +7.0 basis points

• Federal Reserve's Balance Sheet $4.406 Trillion +.05%

• U.S. Sovereign Debt Credit Default Swap 23.76 -.04%

• Illinois Municipal Debt Credit Default Swap 251.85 -.03%

• Western Europe Sovereign Debt Credit Default Swap Index 3.97 n/a

• Asia Pacific Sovereign Debt Credit Default Swap Index 10.13 -10.83%
  

• Emerging Markets Sovereign Debt CDS Index 32.31 +5.4%
  

• Israel Sovereign Debt Credit Default Swap 56.59 -3.72%

• South Korea Sovereign Debt Credit Default Swap 43.40 -7.08%

• Russia Sovereign Debt Credit Default Swap 110.18 -5.71%

• iBoxx Offshore RMB China Corporate High Yield Index 146.44 +.08%

• 10-Year TIPS Spread 2.02% -1.0 basis point

• TED Spread 28.0 -3.0 basis points

• 2-Year Swap Spread 19.25 +.5 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -23.0 -.75 basis points

• N. America Investment Grade Credit Default Swap Index 47.03 +2.55%

• America Energy Sector High-Yield Credit Default Swap Index 322.0 -7.54%

• European Financial Sector Credit Default Swap Index 42.59 +.85%
  

• Emerging Markets Credit Default Swap Index 109.53 -1.61%
  

• CMBS AAA Super Senior 10-Year Treasury Spread to Swaps 163.0 unch.
  

• M1 Money Supply $3.558 Trillion -.07%

• Commercial Paper Outstanding 1,111.11 +2.3%

• 4-Week Moving Average of Jobless Claims 250,750 +9,000

• Continuing Claims Unemployment Rate 1.3% -10.0 basis points
  

• Average 30-Year Mortgage Rate 3.99% +4.0 basis points

• Weekly Mortgage Applications 390.20 +8.27%

• Bloomberg Consumer Comfort 53.5 +1.7 points

• Weekly Retail Sales +3.40% -90.0 basis points

• Nationwide Gas $2.52/gallon +.03/gallon

• Baltic Dry Index 1,303.0 -4.96%

• China (Export) Containerized Freight Index 791.38 +2.34%

• Oil Tanker Rate(Arabian Gulf to U.S. Gulf Coast) 20.0 unch.

• Rail Freight Carloads 207,216 +2.4%

Best Performing Style

• Small-Cap Value +2.2%

Worst Performing Style

• Mid-Cap Value +1.2%

Leading Sectors

• Airlines +6.0%

• Oil Service +4.4%

• Steel +3.7%

• Banks +3.7%

• Retail +3.5%

Lagging Sectors

• Semis -.2% 

• Telecom -1.3%

• Foods -1.4%

• Utilities 2.0%

• REITs -3.0%

Weekly High-Volume Stock Gainers (16)

• EXPI, FC, ALDR, DST, CBMG, WTW, ACOR, SSNC, PTCT, DPLO, KBH, STX, PODD, VRAY, DFRG and CHPE

Weekly High-Volume Stock Losers (11)

• PSMT, ELF, AYI, NUVA, RGNX, NTCT, PLAY, KALA, SVU, BABY and CORE

Weekly Charts

ETFs

• High-Volume Gainers

• High-Volume Losers

Stocks

• High-Volume Gainers

• High-Volume Losers

*5-Day Change