Tuesday Watch

Evening Headlines

Bloomberg:      

• China Traders Add to Bets on Easing as Economic Prospects Dim.
• Yesterday’s Wars Didn’t Prepare the Pentagon for Tomorrow’s China.  
• Tokyo Shows an Inflation Pulse for the First Time in a Year.  
• Korea’s Inflation Quickens as Central Bank Mulls Rate Hike.
• Asia Stocks Set to Dip as Growth Risk Boosts Bonds: Markets Wrap.
• Crude Oil Steadies as Investors Size Up Delta’s Threat to Demand.
• September Taper Talk, N.Z. Housing Curbs, Debt Ceiling: Eco Day.
• ‘Very Real Fourth Wave’ Presses FDA to Fully Approve Covid Shots.
  
• Soaring Aluminum Drives Up Cost of Everything From Beer to Foil.
• Smallest U.S. Firms Lost Revenue Last Year, Fed Survey Finds.  
• A Top Zinc Miner Is Hunting for Copper in an Electrifying World.

Wall Street Journal:

• The Infrastructure ‘Pay-Fors’ That Aren’t.
• Portland Can’t Find Police for Gun-Violence Unit.
• Yellen to Enact Steps to Avoid Breaching Debt Ceiling.
• Federal Labor Official Recommends Alabama Amazon Workers Hold New Vote, Union Says.
• Delta Variant Stalls Asia’s Economic Recovery.
• Fuel-Efficiency Standards Are Set to Get Tougher. The Question Is by How Much.

Fox News:

• Psaki attacks DeSantis over handling of coronavirus pandemic, governor's office fires back.
  

CNBC.com:

• How language in the infrastructure bill could roil the crypto markets.
• Cramer says it is the ‘height of irresponsibility’ to invest in Chinese stocks right now.
• Goldman Sachs joins Wall Street rivals in boosting junior banker salaries. 
• Mall owner Simon Property says sales at its centers returned to pre-pandemic levels in June.
• Stocks making biggest moves after hours: Simon Property Group, Take-Two Interactive and more.

MarketWatch.com:        

• Fed’s Waller suggests ‘early and fast’ tapering of bond purchases.  
• While air travel hits another pandemic high, flight delays grow.

Zero Hedge:

• Bay Area Imposes Mandatory Masking As Cuomo Demands Private Businesses Ban Unvaxxed. 
• Beijing Quietly Issued 'Buy Chinese' Procurement Guidelines For Hospitals & State Companies.
• IMF Creates Record $650 Billion Slush Fund For Pandemic Relief.
• Trump Amends Big Tech Lawsuit As 65,000 Americans Submit Censorship Stories.
• Evictions Start With Nancy Pelosi & The House On A 7-Week Break.
• Delta Wave Has Likely Peaked In UK, Europe, Goldman Analysts Say.
• Drought, Frost Plunge Brazil's Second Corn Yields To Decade Low.
• US Women's Soccer Team Smoked By Canada; Rapinoe Mocked.
• Turley: The Biden Administration Goes To War With The "Non-Vacs".
• Obama Risks Superspreader Event As 700 Expected To Attend 60th Birthday Party At Martha's Vineyard Mansion.
• Fmr US Intel Boss: COVID Lab Leak "Very Close To A Certainty" After Seeing 'Most Sensitive Intel' Related To Pandemic.
• Stealth QE Is Over: Treasury Projects Adding $350BN In Cash By Dec 31, Reversing "Liquidity Tsunami".
• World's Largest Pension Fund Slashes US Treasury Exposure By Record Amount.
• Fauci, HHS "Hiding Something" With Redacted Emails: Sen. Johnson.
• Stocks, Bond Yields, & Crude Tumble As ISM Peaks & Fed Speaks.

Newsmax:

• Hawley Hits 'Gender Identity' Element in Infrastructure Bill.
  

TheGatewayPundit.com:

• Third DC Metro Police Officer Who Was at Capitol on January 6 Dies by Suicide.
• Drone Footage Shows Hundreds Of Migrants Held By Border Patrol Under Texas Bridge – Biden To Provide Them Free Hotels, Plane Tickets, Lawyers.
• 74% of Covid-19 Cases in “Cape Cod Cluster Outbreak” Were Fully Vaccinated.
• CCP Chairman Jack Sellers Delivers Letter To Senate After Defiance of Subpoenas — Senator Wendy Rogers Calls for Treason Charges.
• FBI Agents with Shields, Weapons Drawn, Raid SoCal Home of Non-Violent January 6 Protester who Walked Through Capitol, Took Photos (VIDEO).
• JUST IN: Fully Vaccinated GOP Senator Lindsey Graham Reveals Covid-19 Infection – Experiencing Flu-Like Symptoms, Goes Into Quarantine.
• Sky News Ban: “Big Brother is a Bunch of Woke Billionaires in T-Shirts and Sneakers Imposing their Millennial Activism on the World”. 
• COVID Rules are for the Little People: 400,000 Fans and Mask-less Lori Lightfoot Party at Lolla Palooza Chicago Festival (VIDEO).

The Epoch Times:

• Millions Under Lockdown as China Attempts to Control Delta Outbreak.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
  
• NYTimes.com:  County Trends and Clusters.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity.
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 89.75 -.25 basis point.

• China Sovereign CDS 39.0 -.5 basis point.
  

• Bloomberg Emerging Markets Currency Index 60.20 +.03%.
• Bloomberg Global Risk-On/Risk Off Index 2,562.0 +12.0 points.
• Volatility Index(VIX) futures 22.3 -1.9%.
• FTSE 100 futures -.04%.

• S&P 500 futures +.29%.

• NASDAQ 100 futures +.20%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (BABA)/14.29
• (ATI)/-.19
• (BP)/.10
• (CLX)/1.31
• (COP)/1.13
• (CMI)/4.03
• (DISCA)/.83
• (DISH)/.86
• (DD)/.95
• (ETN)/1.57
• (LLY)/1.89
• (EXPD)/1.63
• (IT)/1.73
• (IGT)/.23
• (LDOS)/1.58
• (LGIH)/3.91
• (LPX)/4.38
• (MAR)/.46
• (NKLA)/-.40
• (PSX)/.60
• (PBI)/.05
• (RL)/.86
• (SEE)/.78
• (SWI)/.22
• (UAA)/.06
• (ZBH)/1.86
  

After the Close:

• (ATVI)/.75
• (AKAM)/1.38
• (AMGN)/4.01
• (CAR)/1.27
• (CZR)/-.28
• (COHR)/1.65
• (HST)/.03
• (H)/-.85
• (LSCC)/.22
• (LYFT)/-.25
• (MTCH)/.55
• (MCHP)/1.91
• (MYGN)/-.11
• (NCR)/.62
• (OXY)/.03
• (PRU)/3.09
• (RNG)/.28
• (SPWR)/.04
  

Economic Releases

10:00 am EST

• Factory Orders for June is estimated to rise +1.0% versus a +1.7% gain in May.
  

Afternoon:

• Wards Total Vehicle Sales for July is estimated to fall to 15.3M versus 15.36M in June.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Bowman speaking, China Services PMI report, weekly US retail sales reports, Jefferies Industrials Conference and the Keefe Bruyette Woods Community Bank Conference could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by consumer and technology 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 Slightly Higher into Final Hour on Diminished Virus Shutdown Fears, Lower Long-Term Rates, Earnings Optimism, Tech/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 19.4 +6.4%
• Bloomberg Global Risk On/Risk Off Index 2,556.0 -61.0 points

• Euro/Yen Carry Return Index 133.96 -.37%

• Emerging Markets Currency Volatility(VXY) 8.59 -.46%

• S&P 500 Implied Correlation 54.3 +5.8%

• ISE Sentiment Index 105.0  +7.0 points
  

• Total Put/Call .82 unch.

• NYSE Arms 1.1 -42.1%

Credit Investor Angst:

• North American Investment Grade CDS Index 49.65 +.07%
  

• US Energy High-Yield OAS 430.32 +1.4%

• European Financial Sector CDS Index 53.81 -.77%

• Italian/German 10Y Yld Spread 106.0 -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 91.0 +.1%
  

• Emerging Market CDS Index 163.02 -.89%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 37.8 unch.

• 2-Year Swap Spread 7.75 unch.

• TED Spread 7.75 -.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -4.0 +.75 basis point
  
• MBS  5/10 Treasury Spread  72.75 +.25 basis point
  
• IHS Markit CMBX BBB- 6 73.5 -.25 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 60.22 +.32%
• 3-Month T-Bill Yield .04% unch.
  

• Yield Curve 104.0 -1.0 basis point
  

• China Iron Ore Spot 177.70 USD/Metric Tonne -.2%

• Citi US Economic Surprise Index -15.4 -1.6 points

• Citi Eurozone Economic Surprise Index 38.5 -1.9 points
  

• Citi Emerging Markets Economic Surprise Index 41.5 -7.8 points

• 10-Year TIPS Spread 2.37 -3.0 basis points
• 100.0% chance of no change at Nov. 3rd meeting, 100.0% chance of no change at Dec. 15th meeting

US Covid-19:

• 170 infections/100K people(last 7 days) +26/100K people
• 32% of Jan. 7th, 2021 peak(highest daily avg. new infections) +5.0 percentage points
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -171 open in Japan 
• China A50 Futures: Indicating -166 open in China

• DAX Futures: Indicating -19 open in Germany

Portfolio:

• Higher: On gains in my tech/biotech/consumer discretionary sector longs
  

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Bear Radar

 Style Underperformer:

• Small-Cap Value -.1%

Sector Underperformers:

• 1) Steel -1.2% 2) Telecom -.8% 3) Gold & Silver -.7%

Stocks Falling on Unusual Volume: 

• KMPR, EQT, CERT, POSH, FIS, TDS, OWL, GPN, EVGO, TGTX and XPO
  

Stocks With Unusual Put Option Activity:

• 1) ON 2) MGI 3) KHC 4) BG 5) UAA
  

Stocks With Most Negative News Mentions:

• 1) TGTX 2) MRIN 3) AXAS 4) TDS 5) USM
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Growth +.6%

Sector Outperformers:

• 1) Shipping +2.2% 2) Video Gaming +1.7% 3) Semis +1.3%

Stocks Rising on Unusual Volume:

• ANVS, SAVA, BTBT, AFRM, ON, SQ, ARCT, DOCN, CANO, LPG, DXC, CAR, FUV, HARP, KNBE, FTNT, GRSV, AMTI, ZYXI, TSLA, SLAB, UAA, XENT, RL, ALXO, MSTR, ABOS, AMD and PFE
  

Stocks With Unusual Call Option Activity:

• 1) ON 2) PARR 3) FIS 4) NCR 5) ELY

Stocks With Most Positive News Mentions:

• 1) EVK 2) ON 3) AFRM 4) XPEV 5) LPG
  

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -14.7% Below 100-Day Average 
• 9 Sectors Rising, 2 Sector Declining
• 58.7% of Issues Advancing, 37.0% Declining
• 160 New 52-Week Highs, 21 New Lows
• 76.7% of Issues Above 200-day Moving Average
• Average 14-Day RSI 48.2%
  
• Bloomberg Global Risk-On/Risk-Off Index 2,596.0 -20.0 points
• Russell 1000: Growth/Value 17,579 +.2%
  
• Vix 18.4 +1.1%
• Total Put/Call .71 -13.4%
• TRIN/Arms .89 -50.0%

Monday Watch

Today's Headlines

Bloomberg:                       

• Xi Jinping’s Capitalist Smackdown Sparks a $1 Trillion Reckoning.
  
• Macau Gaming Revenue Recovery Slows Amid Travel Restrictions.
• China’s Top Steel Body Expects Wider Output Cuts as Demand Slows.  
• U.S. Blames Iran for Ship Attack, Plans ‘Appropriate Response’.
• Inflation Angst Spreads to India Bonds as RBI Downplays Risk.
• U.K. Companies Step Up Hiring and Wages Amid Reopening.
• Pfizer, Moderna Increase EU Vaccine Pricing in Latest Deals: FT.  
  
• Global Copper Supply at Risk As Workers Vote to Strike.   
• French Car Sales Drop 35% in July as Chip Shortage Crimps Supply.
  
• Thailand Expands Quasi-Lockdown to Cover 40% of Population.   
• Asia Stocks Rise as China-Sparked Dip Draws Buyers: Markets Wrap.
• Saudi Banks, Abu Dhabi Stocks Gain Amid Earnings: Inside EM.   
• Oil Opens Week Steady as Traders Weigh Demand, Iranian Tensions.
• Five Things You Need to Know to Start Your Day.
• U.S. Debt Ceiling Suspension Ends, Congress Unclear on Next Step.
• Treasury Traders Eye Supply-Demand Risks With Yields Near Lows.   
• Japan, U.K. Plan Booster Jabs; India at Risk Again: Virus Update.
  
• Brainard Differs With Powell Ahead of Biden Fed Chair Choice.
• World’s Biggest Pension Fund Cuts U.S. Bond Weighting by Record.   
• Fed’s Kashkari Warns Delta Variant Could Slow Jobs Recovery.

Wall Street Journal:

• Investors Bet Price Pressures Will Ease.
• A Cash-Strapped Corner of China Finds a Financial Tonic—Hard Liquor.
• Higher Pay for New Workers Ripples Through the Ranks.
• Tech Startup Financing Hits Records as Giant Funds Dwarf Venture Capitalists.
• Two U.S. Companies Seek Continued Tariffs on Imported Solar Panels.
• FDA Pressured to Grant Full Approval to Covid Shots.
• Heavyweight Companies Enjoy Outsize Rewards as Economy Rebounds.
• Bye-Bye Bikinis? Athletes at the Olympics and Beyond Fight "Sexist" Uniforms.
• The Rental Evictions Fiasco.

Fox News: 

• Controversial Olympian who protested national anthem says she's 'earned' right to wear US colors.
• HANSON: Americans are sick of being called racists — and ratings prove that.
• Pandemic gun demand leaves law enforcement, instructors short on ammo.

CNBC:

• Senator Manchin says the infrastructure bill text is going to be done today.
• One leading S&P 500 sector just posted its best win streak in more than a year.
• Top Wall Street analysts are betting on more gains for these stocks as earnings continue. 
• Square to buy Australian giant Afterpay for $29 billion as buy now, pay later booms.
• Fauci says he expects no new U.S. lockdowns despite surging delta cases.
• July jobs report could be what gives the market its next big jolt in the week ahead.
• Why Apple shareholders shouldn’t be too worried after the earnings selloff.

Zero Hedge: 

• Bill Maher Rips Woke Mentality Now Driving Olympic Games: "Belongs In Stalin’s Russia".
• 10 Republicans Back Bill Calling For Audit Of The CDC.
• Higher Gas Prices Mean Higher Taxes: Illinoisans Now Pay The Nation's 2nd-Highest Gas Taxes.
• San Fran DA Chesa Boudin Stands Up For Shoplifters And Drug Dealers.
• FDA May Grant Full Approval For Pfizer Jab As Early As September.
• Goldman's Top 10 Takeaways From July.
• Illinois Unconcerned As Communication And 'Science' Behind COVID Policy Slip Toward Chaos.
• Senate Concludes Infrastructure Bill Text, Moves Toward Vote.
• Major Unions Push Back Against Biden's Vaccine Mandates.
• Orange County Records Spike In Fentanyl Deaths.
• Bill Blain Warns "Financial Asset Inflation Is Now Creeping Into The Real World".
• US Ports Face Peak-Season "Gridlock Plus" As Anchorages Fill.
• To Advance The Climate Agenda: Never Waste Bad Weather.
• Protesters Rage In Paris Against "Health Passports".
• The Latest Lie From On-High: An "Independent Federal Reserve".
• Twitter Suspends Science Writer After He Posts Results Of Pfizer Clinical Test.
• Is A Liquor Shortage Looming?
• Tax-To-GDP Ratio: Comparing Tax Systems Around The World.
• Brandon Smith: Why Are Globalists And Governments So Desperate For 100% Vaccination Rates?
• CDC's Walensky Shrugs Off Idea That Illegals Are Spreading COVID At The Border, Promises "Guidelines" Someday.
• California Parents Are Pulling Children From Public Schools.
• 3D Printed Soft Robo-Hand Can Play Nintendo Super Mario Bros. And Win.
• California Biggest Public Sector Union Opposes Newsom's Vaccine Order.

NewsMax:

• Diamond and Silk Slam Fox News for Mike Lindell TV Ban.
• Breakneck Pace of Crises Keeps National Guard Away From Home. 
• Dick Morris: Biden's Handling of COVID Led to Drop in Polls.
  

TheGatewayPundit.com:

• Australia will Use Military to Enforce Sydney Covid Lockdown – Troops will Knock on Doors to Make Sure Residents are at Home.
• BREAKING EXCLUSIVE: Uncovered Email Shows Milwaukee Elections Executive Woodall-Vogg Laughing About the Election Steal on Election Night.
• Sen. John Barrasso: Democrats’ No. 1 Goal Is Passing S1 where You Don’t Need to Have a Voter ID Anymore – Making It Easier for Democrats to Cheat (VIDEO).
• Dominion Voting Machines Arrive in Ohio County Costing $6.17 Million Up Front — Machines Include Software to “Evaluate Voter Intent”. 
• Police Beat, Pepper-Spray Anti-Lockdown Protesters in Berlin (VIDEO).
• Joe Biden Looks to Provide Free Lawyers at Border to Assist Hundreds of Thousands of Illegal Invaders as They Cross the Open US Southern Border.
• CDC to Start Using a New COVID Test that Will Better Identify Flu Cases After Seasonal Flu Numbers Disappeared in 2020.

The Epoch Times:

• Republicans on House Science Committee Urge Probe Into CCP Virus Origins.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
  
• NYTimes.com:  County Trends and Clusters.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity.
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading

• Asian indices are unch. to +1.0% on average.
• Asia Ex-Japan Investment Grade CDS Index 90.0 +1.0 basis point.
• China Sovereign CDS 39.5 +.5 basis point.
• Bloomberg Emerging Markets Currency Index 60.03 -.01%.
• Bloomberg Global Risk-On/Risk Off Index 2,647.0 +30.0 points.
• Volatility Index(VIX) futures 21.7 -1.6%. 
• Euro Stoxx 50 futures +.43%.
• S&P 500 futures +.48%.
• NASDAQ 100 futures +.38%

Morning Preview Links

Earnings of Note

Company/Estimate

Before the Open:

• (CNA)/1.12
• (GPN)/1.90
• (ON)/.49
• (TKR)/1.44
  

After the Close:

• (ANET)/2.55
• (BCC)/4.43
• (COLM)/-.09
• (EMN).2,33
• (FANG)/2.19
• (MOS)/.99
• (NXPI)/2.32
• (PXD)/2.54
• (SBAC)/2.40
• (SPG)/2.38
• (TTWO)/.90
• (RIG)/-.14
• (TREX)/.53
• (VNO)/.71
• (WMB)/.28
  

Economic Releases

10:00 am EST

• Construction Spending MoM for June is estimated to rise +.5% versus a -.3% decline in May.
• ISM Manufacturing for July is estimated to rise to 60.7 versus 60.6 in June.
• ISM Prices Paid for July is estimated to fall to 88.0 versus 92.1 in June.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Australia interest rate decision, Eurozone PMI report and the (F) fireside chat could also impact trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

BOTTOM LINE: Asian indices are higher, boosted by industrial and technology shares in the region. I expect US stocks to open modestly higher and to maintain gains nto the afternoon.  The Portfolio is 100% net long heading into the week.