Morning Market Internals

NYSE Composite Index:

• Volume Running -9.7% Below 100-Day Average
• 10 Sectors Rising, 3 Sectors Declining
• 74.6% of Issues Advancing, 23.3% Declining
• 117 New 52-Week Highs, 18 New Lows
• 47.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 50.4%
• Vix 13.8 -.9%
• Total Put/Call .67 -22.1%
• TRIN/Arms 2.4 +91.1%

Thursday Watch

Night Trading 

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 74.0 +.5 basis point. 

• China Sovereign CDS 50.0 +6.0 basis points. (new series)

• Bloomberg Emerging Markets Currency Index 68.32 +.06%.

• FTSE 100 futures -.4%.

• S&P 500 futures +.14%.

• NASDAQ 100 futures +.22%.

Morning Preview Links

Earnings of Note
Company/Estimate

Before the Open:

• (ATU)/.17
• (CSIQ)/1.16
• (CMC)/.27
• (CAG)/.49
• (DRI)/1.75
• (GIII)/.43
• (LE)/.41

After the Close:

• (CTAS)/1.72
• (JEF)/.24
• (NKE)/.65
• (SCHL)/-.27

Economic Releases
8:30 am EST

• The Philly Fed Business Outlook Index for March is estimated to rise to 4.8 from -4.1 in February.
• Initial Jobless Claims for last week are estimated to fall to 225K versus 229K the prior week. 
• Continuing Claims are estimated to fall to 1770K versus 1776K prior.
  

10:00 am EST

• The Leading Index for February is estimated to rise +.1% versus a -.1% decline in January.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Australia Unemployment Rate, BoE Meeting and the weekly EIA natural gas inventory report could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by technology and commodity shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 75% net long heading into the day.

Stocks Slightly Lower into Final Hour on Global Growth Concerns, Yen Strength, Profit-Taking, Financial/Healthcare Sector Weakness

 Broad Equity Market Tone:

• Advance/Decline Line: Slightly Higher
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 13.2 -2.51%

• Euro/Yen Carry Return Index 131.56 +.13%

• Emerging Markets Currency Volatility(VXY) 7.83 +1.03%

• S&P 500 Implied Correlation 37.91 -2.47%

• ISE Sentiment Index 67.0 -25.6%
  

• Total Put/Call .91 -5.21%

• NYSE Arms 1.04 -4.59%

Credit Investor Angst:

• North American Investment Grade CDS Index 63.75 +10.7%(new series)
  

• America Energy Sector High-Yield CDS Index 512.0 +2.22%

• European Financial Sector CDS Index 78.68 +15.4%

• Italian/German 10Y Yld Spread 239.75 +2.75 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 73.49 +14.0%
  

• Emerging Market CDS Index 165.57 -.12%
  

• iBoxx Offshore RMB China Corporate High Yield Index 160.02 +.09%

• 2-Year Swap Spread 11.0 +.75 basis point

• TED Spread 19.0 -1.0 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -12.0 -2.75 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 68.35 +.61%
• 3-Month T-Bill Yield 2.45% unch.

• Yield Curve 14.0 -.25 basis point

• China Iron Ore Spot 83.04 USD/Metric Tonne +.67%

• Citi US Economic Surprise Index -35.40 +.9 point

• Citi Eurozone Economic Surprise Index -25.50 +.9 point

• Citi Emerging Markets Economic Surprise Index -23.50 +1.2 points

• 10-Year TIPS Spread 1.97 +2.0 basis points
• 0.0% chance of Fed rate hike at June 19th meeting, 0.0% chance at July 31st meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -197 open in Japan 
• China A50 Futures: Indicating +23 open in China

• DAX Futures: Indicating +51 open in Germany

Portfolio:

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

• Disclosed Trades: None

• Market Exposure: 75% Net Long

Morning Market Internals

NYSE Composite Index:

• Volume Running -13.2% Below 100-Day Average
• 4 Sectors Rising, 7 Sectors Declining
• 26.4% of Issues Advancing, 70.4% Declining
• 27 New 52-Week Highs, 32 New Lows
• 48.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 51.4%
• Vix 14.1 +4.1%
• Total Put/Call .81 -15.6%
• TRIN/Arms 1.10 +.92%

Wednesday Watch

Night Trading 

• Asian equity indices are -.5% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 73.50 +9.0 basis points. 

• China Sovereign CDS 44.0 -.5 basis point.

• Bloomberg Emerging Markets Currency Index 67.93 -.01%.

• FTSE 100 futures +.51%.

• S&P 500 futures -.04%.

• NASDAQ 100 futures -.05%.

Morning Preview Links

Earnings of Note
Company/Estimate

Before the Open:

• (GIS)/.69

After the Close:

• (GES)/.75
• (MLHR)/.61
• (MU)/1.68
• (WSM)/1.97
• (WOR)/.56

Economic Releases
10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +336,000 barrels versus a -3,862,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -2,608,440 barrels versus a -4,624,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,172,220 barrels versus a +383,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.32% versus a +.1% gain prior.
  

2:00 pm EST

• The FOMC is expected to leave the benchmark Fed Funds rate between 2.25-2.5%.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's press conference, UK CPI report, weekly MBA Mortgage Applications report and the (NTNX) investor day could also impact trading today.

BOTTOM LINE:  Asian indices are mostly lower, weighed down by technology and industrial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing modestly mixed.  The Portfolio is 75% net long heading into the day.

Wednesday Watch

Night Trading 

• Asian equity indices are -.5% to -.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 73.50 +9.0 basis points. 

• China Sovereign CDS 44.0 -.5 basis point.

• Bloomberg Emerging Markets Currency Index 67.93 -.01%.

• FTSE 100 futures +.51%.

• S&P 500 futures -.04%.

• NASDAQ 100 futures -.05%.

Morning Preview Links

Earnings of Note
Company/Estimate

Before the Open:

• (GIS)/.69

After the Close:

• (GES)/.75
• (MLHR)/.61
• (MU)/1.68
• (WSM)/1.97
• (WOR)/.56

Economic Releases
10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +336,000 barrels versus a -3,862,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -2,608,440 barrels versus a -4,624,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,172,220 barrels versus a +383,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.32% versus a +.1% gain prior.
  

2:00 pm EST

• The FOMC is expected to leave the benchmark Fed Funds rate between 2.25-2.5%.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's press conference, UK CPI report, weekly MBA Mortgage Applications report and the (NTNX) investor day could also impact trading today.

BOTTOM LINE:  Asian indices are mostly lower, weighed down by technology and industrial shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing modestly mixed.  The Portfolio is 75% net long heading into the day.