Bear Radar

Style Underperformer:

• Small-Cap Value -.8%

Sector Underperformers:

• 1) Airlines -2.9% 2) Banks -2.1% 3) Homebuilders -2.1%

Stocks Falling on Unusual Volume: 

• C, YETI, UVV, STAY, NCLH, SAVE, HOG, BOOT, JWN, UAL, XRX, LW, CHRS, AFG, CCL, NTNX, ARNA, NMIH, IRWD, KIM, CAR, USFD, FNF, KSS, TSE, GBX, USCR, MNRO, ANF, CRNC, SIX, PLT, NERV, HPQ and IOVA

Stocks With Unusual Put Option Activity:

• 1) BOX 2) DLTR 3) HPQ 4) CWH 5) TWTR

Stocks With Most Negative News Mentions:

• 1) REX 2) HPQ 3) ANF 4) GS  5) SABR

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Mid-Cap Growth +1.2%

Sector Outperformers:

• 1) Medical Equipment +2.6% 2) Utilities +2.3% 3) Pharma +1.8%

Stocks Rising on Unusual Volume:

• TGI, DLTR, FLXN, DKNG, WDAY, PLMR, CALX, ALXN, FLGT, MRNA, SMTC, AOBC, COMM, RCUS, BILL, REGN, HPP, SLAB, GES and TOL

Stocks With Unusual Call Option Activity:

• 1) DLTR 2) AOBC 3) SKX 4) TOL 5) BOX

Stocks With Most Positive News Mentions:

• 1) DLTR 2) SMTC 3) WDAY 4) LBRT 5) HP

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +12.4% Above 100-Day Average
• 8 Sectors Rising, 3 Sectors Declining
• 52.4% of Issues Advancing, 45.4% Declining
• 33 New 52-Week Highs, 0 New Lows
• 21.8% of Issues Above 200-day Moving Average
• Average 14-Day RSI 56.8%
• Vix 27.9 +.9%
• Total Put/Call .70 -18.6%
• TRIN/Arms 1.76 +114.6%

Thursday Watch

Evening Headlines

Bloomberg:        

• World’s Biggest Lockdown to Push 12 Million into Extreme Poverty.

• U.S. Says Hong Kong’s Autonomy Is Gone, Sowing China Trade Doubt.

• House Passes Uighur Bill in Rebuke to China, Sends It to Trump.

• U.S. Will Join G-7 AI Pact, Citing Threat From China. 

• U.S. Move on Hong Kong Leaves Trump With Tough-or-Gentle Options.

• U.S.-China Confrontation Risk Is Highest in the South China Sea. 

• Global Stock Rally Builds in Asia on Recovery Hope. Asian stocks climbed early Thursday as investors weighed continued signs of economies reopening against the increase in Sino-American tensions over Hong Kong. The yen dipped and Treasuries nudged down. Japanese shares opened about 1% higher, with gains of more than 1% in Australia and more modest ones in South Korea. Futures retreated in Hong Kong and U.S. contracts ticked higher. The Trump administration said it could no longer certify Hong Kong’s political autonomy from China, a move that could have far-reaching consequences on its special trading status with the U.S. Still, the S&P 500 climbed to an 12-week high, holding above technical levels considered key by chart watchers. The Nasdaq turned positive late in the session after Micron Technologies forecast earnings that were ahead of estimates, lifting chipmakers. Futures on the S&P 500 Index added 0.3% 9:15 a.m. in Tokyo. The gauge rose 1.5% on Wednesday. Japan’s Topix index climbed 1%. South Korea’s Kospi index added 0.7%. Australia’s S&P/ASX 200 Index rose 1.8%.

• Oil Extends Drop After Report Stokes Concerns Over Excess Supply.   

• Hong Kong Autonomy Revoked, Fed Yield Target, EU Rescue: Eco Day.

• ‘Superforecasters’ Say a Covid-19 Vaccine Is Still a Ways Off. 

• Investors Pile Into Stocks That Win in a Full Economic Recovery.

• Toll Brothers Surges on Recent Gain in Deposits for New Homes.

Wall Street Journal:

• New York Starts Mapping Out the Road Back From Coronavirus—and It’s Long.

• U.S. Officially Declares That Hong Kong Is No Longer Autonomous.

• Twitter Plays Into Trump’s Hands.

• What Is Joe Biden Talking About?

• Why Does Zoom Exhaust You? Science Has an Answer.

• Boeing Details Plans for Mass Job Cuts.

Fox News:

• House Dems forge ahead on surveillance vote as GOP cries foul, Trump threatens veto.

CNBC.com:

• Tuesday Morning is about to close 130 stores. Here’s a map of where they are.

• Jim Cramer: Bull investors are ‘confused’ about the economic recovery.

• Coronavirus updates: California says guidelines for reopening gyms coming soon, Bezos defends safety record.

• U.S. coronavirus death toll rises above 100,000 in world’s deadliest outbreak.

• Stocks making the biggest moves after hours: Boeing, Workday, Toll Brothers and more.

MarketWatch.com:       

• HP sales dive more than 11% despite work-from-home demand, stock falls in late trading.

• Carl Icahn logs nearly $2 billion loss as he sells all Hertz stock.

• Fed’s Beige Book says businesses are pessimistic about pace of a recovery.

• These big banks may be at risk of dividend cuts after the Federal Reserve’s stress tests.

Zero Hedge:  

• Trump To Sign Social Media Executive Order On Thursday After 'Fact-Check', Political Bias Exposed.

• Here Is The Best Advance Indicator If A Second Wave Of Coronavirus Is Coming.

• What Could Come Next Regarding Hong Kong: Here Is The Nuclear Option.

• Trump Offers To "Mediate" India & China's "Raging Border Dispute" Amid Military Build-Up.

• Absolute Insanity: Retail Investors Flood Into Bankrupt Hertz, Make It Most Heavily-Traded US Stock.

• Epstein Lawyer: "It Was Homicide, But I Don't Know Who Killed Him".

• CNBC Scandal: Watch As Raging Screamfest Erupts Between Kernen, Sorkin Over Coronavirus.

• Le Pain Quotidien Is Latest Food Chain To File For Bankruptcy.

• Wikipedia Co-Founder Says Site Is 'Badly Biased'.

• Why Credit Suisse Sees 0% Returns Over The Next Decade.

• House Votes To Send New China Sanctions Bill To Trump's Desk.

• Despite The Hype, Gilead's Remdesivir Will Do Nothing To End The COVID-19 Pandemic.

• Boeing Shares Soar As 737 Max Production Restarts .

• WTI Extends Losses After Huge Surprise Crude Inventory Build.

• CCP Mouthpiece Slams "Habitual Liar" Pompeo, Says US 'Incapable' Of Judging Hong Kong's Autonomy.

• If You're Buying Stocks During The US Day, You're Doing It All Wrong.

The Epoch Times:

• Senate Passes Bill to Boost Oversight of Chinese Firms on US Stock Exchange.

• Pompeo：The West Has Had Enough of the Chinese Regime.

John Hopkins University:

• Coronavirus Global Cases. (map)

BNO News:

• Tracking Coronavirus: Map, data and timeline.

KFF:

• State Data(Tests/Hospitalizations).

Night Trading 

• Asian equity indices are +.75% to +1.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 100.50 -4.0 basis points.

• China Sovereign CDS 52.5 +1.25 basis points.

• Bloomberg Emerging Markets Currency Index 60.03 +.05%.

• FTSE 100 futures +.85%.

• S&P 500 futures +.30%.

• NASDAQ 100 futures +.25%.

Morning Preview Links

Earnings of Note 
Company/Estimate

Before the Open:

• (ANF)/-1.2

• (BURL)/-1.61

• (CSIQ)/1.09

• (DG)/1.76

• (DLTR)/.86

• (FLR)/.25

• (LL)/-.05

• (MNRO)/.21

• (SAFM)/-1.04

• (SHOO)/.17

• (TECD)/1.38

• (TD)/.89

• (TGI)/.59

After the Close:

• (COST)/1.85

• (DELL)/.93

• (MRVL)/.14

• (JWN)/-1.17

• (OKTA)/-.17

• (OLLI)/.34

• (CRM)/.70

• (ULTA)/.67

• (VMW)/1.18

• (WSM)/.05

• (ZS)/.02

Economic Releases
8:30 am EST

• Durable Goods Orders for April is estimated to fall -19.3% versus a -14.7% decline in March.

• Durables Ex Transports for April is estimated to fall -15.0% versus a -.4% decline in March.

• Cap Goods Orders Non-Defense Ex-Air for April is estimated to fall -10.0% versus a -.1% decline in March.

• Initial Jobless Claims for last week are estimated to fall to 2100K versus 2438K the prior week.

• Continuing Claims are estimated to rise to 25500K versus 25073K prior.

10:00 am EST

• Pending Home Sales MoM for April is estimated to fall -15.0% versus a -20.8% decline in March.

11:00 am EST

• The Kansas City Fed Manufacturing Activity Index for May is estimated to rise to -22 versus -30 in April.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The German inflation report, $38B 7Y T-Note auction, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report and the (NVDA) presentation could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

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

Stocks Higher into Final Hour on Global Stimulus Optimism, Economy Re-Opening Hopes, Short-Covering, Financial/Transport Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Above Average

• Market Leading Stocks: Outperforming

Equity Investor Angst:

• Volatility(VIX) 27.9 -.36%

• Euro/Yen Carry Return Index 122.74 +.22%

• Emerging Markets Currency Volatility(VXY) 10.7 +1.4%

• S&P 500 Implied Correlation 61.7 -2.6%

• ISE Sentiment Index 105.0 +16.0 points

• Total Put/Call .87 +8.8%

• NYSE Arms .79 -26.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 80.53 -5.69%
  

• US Energy High-Yield OAS 1,029.66 -1.32%

• European Financial Sector CDS Index 82.52 -3.65%

• Italian/German 10Y Yld Spread 191.50 +1.5 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 101.31 -3.69%
  

• Emerging Market CDS Index 291.22 -.04%
  

• iBoxx Offshore RMB China Corporate High Yield Index 166.20 +.34%

• 2-Year Swap Spread 8.5 -.5 basis point

• TED Spread 23.5 -1.5 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -10.5 -1.5 basis points
• MBS  5/10 Treasury Spread  116.0 +3.0 basis points
• IHS Markit CMBX BBB- 6 64.0 unch.

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 59.97 -.13%
• 3-Month T-Bill Yield .14% +2.0 basis points

• Yield Curve 52.75 +3.75 basis points

• China Iron Ore Spot 93.92 USD/Metric Tonne +2.12%

• Citi US Economic Surprise Index -75.30 +3.9 points

• Citi Eurozone Economic Surprise Index -251.0 -4.7 points

• Citi Emerging Markets Economic Surprise Index 8.8 +1.1 points

• 10-Year TIPS Spread 1.13 -1.0 basis point
• 99.3% chance of no change at July 29th meeting, 99.3% chance of no change at Sept. 16th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +156 open in Japan 
• China A50 Futures: Indicating -23 open in China

• DAX Futures: Indicating +43 open in Germany

Portfolio:

• Slightly Higher: On gains in my tech/medical/consumer staple/industrial sector longs

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges, then covered some of them

• Market Exposure: 50% Net Long