Bull Radar

Style Outperformer:

• Small-Cap Growth +.2%

Sector Outperformers:

• 1) Social Media +2.3% 2) Video Gaming +1.3% 3) Retail +1.1%

Stocks Rising on Unusual Volume:

• YY, CTRP, HUYA, WLTW, LLY, GSKY, TPB, EEMA, CBPO, ASND, HCSG, TGT, KSS, AVLR, BNFT, TPIC, KALV, NIO, AMRC, BZUN, TPIC, SE, LTHM, TGT, PLCE, CORE and GPRE

Stocks With Unusual Call Option Activity:

• 1) RCII 2) ANTM 3) F 4) CIEN 5) TGT

Stocks With Most Positive News Mentions:

• 1) CTRP 2) KSS 3) TGT 4) HOG 5) GNK

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume

Morning Market Internals

NYSE Composite Index:

• Volume Running -4.6% Below 100-Day Average
• 5 Sectors Rising, 6 Sectors Declining
• 36.7% of Issues Advancing, 59.8% Declining
• 39 New 52-Week Highs, 12 New Lows
• 49.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 53.9%
• Vix 15.1 +3.4%
• Total Put/Call .96 -3.0%
• TRIN/Arms 1.03 +2.0%

Tuesday Watch

Evening Headlines

Bloomberg:     

• Trump and Xi Are Close to a Deal, But Trade War Isn't Over.  

• China Lowers Growth Target and Cuts Taxes as Economy Slows.    

• China Defense Spending Set to Rise 7.5% as Xi Builds Up Military. 

• The World's Dirtiest Air Is in India.

• It's Hedge Funds Against Long-Term Players in Japan Stock Market.

• Asian Stocks Track U.S. Slide; Dollar Edges Higher. Asian stocks tracked U.S. shares lower as investors look for details of a possible trade deal between the U.S. and China. The dollar edged higher and Treasury yields held declines. Equities fell in Japan, Korea and Australia after the S&P 500 Index declined the most in a month, though the benchmark did pare the worst of its losses late in the session. Chinese stocks will be closely watched after the country lowered its goal for economic growth and announced a major tax cut. The yuan was little changed. Japan’s Topix index fell 0.6 percent as of 9:13 a.m. in Tokyo. S&P/ASX 200 Index fell 0.5 percent. Hong Kong’s Hang Seng Index futures fell 0.9 percent. S&P 500 futures were little changed.   

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

• China VAT Cut, Debt Binge Looks Like MMT, U.S. Growth: Eco Day.

• Democrats Plan Anti-Semitism Measure After Omar Remarks.  

• Ocasio-Cortez Aide Floats Amazon’s Return to NYC If Done Via Right ‘Process’.

Wall St. Journal:

• Purdue Pharma Prepares Possible Bankruptcy Filing.

• House Panel Requests Documents From Scores of Trump Associates. 

• High-Speed Rail in the U.S. Remains Elusive: Illinois Shows Why.

MarketWatch.com:

• Don’t write off stocks — the market is poised to hit new peaks, strategist says.

Fox News:

• House Dems to introduce resolution condemning anti-Semitic comments amid Omar scandal.

• Kavanaugh slams church treatment as court nixes religious liberty case.

CNBC:

• Stocks making the biggest moves after hours: Salesforce, GameStop and more.

• Salesforce shares slide on disappointing earnings and revenue forecast.

Zero Hedge:

• Ocasio-Cortez Mocks Critics Of Her Massive Carbon Footprint.

• It Begins: China's Largest Property Developer Will Sell All Homes At A 10% Discount.

• Green New Deal: A Dystopian Future Awaits?

• Beijing Goes 'Full Orwell' As Annual National Party Congress Begins.

• Spooked? Christopher Steele Cancels Appearance After Cohen Testimony Destroys Dossier Allegation.

• "Every Indicator Is Blinking Red" - Aussie PMI Plunges To Record Low Ahead Of RBA Decision.

• 'Witch Hunt' Intensifies: Full List Of 81 People Hit With House Judiciary Document Requests.

• In Major Blow To Trudeau, Senior Minister Quits Over Corruption Allegations. 

• Stocks Skid, Bonds Bid As "Sell The News" Strikes At Critical Resistance.

Night Trading 

• Asian equity indices are -.50% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 66.75 -1.25 basis points. 

• China Sovereign CDS 47.25 -1.75 basis points.

• Bloomberg Emerging Markets Currency Index 67.94 -.06%.

• FTSE 100 futures -.13%.

• S&P 500 futures -.09%.

• NASDAQ 100 futures -.11%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (CIEN)/.30

• (JWA.A)/.78

• (KSS)/2.18

• (SINA)/.89

• (TGT)/1.52

• (WB)/.75

After the Close:

• (AVAV)/.16

• (COO)/2.50

• (NX)/-.12

• (ROST)/1.13

• (URBN)/.79

• (ZAGG)/.50

Economic Releases
10:00 am EST

• The ISM Non-Manufacturing Index for Feb. is estimated to rise to 57.3 versus 56.7 in Jan.

• New Home Sales for Dec. is estimated to fall to 600K versus 657K in Nov.

2:00 pm EST

• The Monthly Budget Statement for Jan. is estimated to rise to $12.0B versus -$13.5B in Dec.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Rosengren speaking, China Services PMI report, Eurozone Services/Retail Sales reports, US weekly retail sales reports, JPMorgan Aviation/Transport/Industrials Conference, Morgan Stanley Med Tech Conference, CSFB Healthcare Conference, Evercore ISI Airline conference and the (H) investor day could also impact trading today.

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

Stocks Reversing Lower into Afternoon on China Trade Deal Concerns, Profit-Taking, Technical Selling, Defense/Healthcare Sector Weakness

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• Volatility(VIX) 15.5 +14.4%

• Euro/Yen Carry Return Index 131.55 -.49%

• Emerging Markets Currency Volatility(VXY) 8.21 -.48%

• S&P 500 Implied Correlation 40.40 +1.15%

• ISE Sentiment Index 76.0 -45.71%
  

• Total Put/Call .97 +8.99%

• NYSE Arms 1.07 +5.94%

Credit Investor Angst:

• North American Investment Grade CDS Index 60.06 +1.03%
  

• America Energy Sector High-Yield CDS Index 506.0 -.06%

• European Financial Sector CDS Index 75.84 +.16%

• Italian/German 10Y Yld Spread 258.0 +3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 66.75 -3.44%
  

• Emerging Market CDS Index 170.41 +1.37%
  

• iBoxx Offshore RMB China Corporate High Yield Index 158.73 +.04%

• 2-Year Swap Spread 8.50 -.5 basis point

• TED Spread 17.0 -3.0 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -9.0 +1.25 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 67.95 -.11%
• 3-Month T-Bill Yield 2.42% -1.0 basis point

• Yield Curve 18.25 -1.5 basis points

• China Iron Ore Spot 83.25 USD/Metric Tonne -.23%

• Citi US Economic Surprise Index -43.10 +.3 point

• Citi Eurozone Economic Surprise Index -60.0 +1.6 points

• Citi Emerging Markets Economic Surprise Index -16.5 +2.3 points

• 10-Year TIPS Spread 1.94 -2.0 basis points
• 0.0% chance of Fed rate hike at May 1st meeting, 0.0% chance at June 19th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -287 open in Japan 
• China A50 Futures: Indicating +6 open in China

• DAX Futures: Indicating -34 open in Germany

Portfolio:

• Lower: On losses in my biotech/medical/retail sector longs

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 50% Net Long