Thursday, July 06, 2023

Morning Market Internals

NYSE Composite Index:

  • NYSE Volume Running -.9% Below 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 15.6 +6.7
  • 11 Sectors Declining, 0 Sectors Rising
  • 6.9% of Issues Advancing, 91.4% Declining
  • 12 New 52-Week Highs, 19 New Lows
  • 48.6%(-4.4%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 49.0 -12.0
  • Bloomberg Global Risk-On/Risk-Off Index 64.2 -.3%
  • Russell 1000: Growth/Value 17,558.5 +.57%
  • 1-Day Vix 10.8 +7.4%
  • Vix 16.7 +17.8% 
  • Total Put/Call .82 -12.8%
  • TRIN/Arms 1.95 +134.9%

Wednesday, July 05, 2023

Thursday Watch

Evening Headlines

Bloomberg:

Zero Hedge:
Wall Street Journal:  
 TheGatewayPundit.com:
Twitter: 
OpenVAERS:
SKirsch.com:
Night Trading 
  • Asian equity indices are -.75% to -.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 115.0 +1.5 basis points. 
  • China Sovereign CDS 62.0 -2.25 basis points.
  • China Iron Ore Spot 110.0 USD/Metric Tonne +.34%.
  • Bloomberg Emerging Markets Currency Index 43.4 +.02%.
  • Bloomberg Global Risk-On/Risk Off Index 64.1 -.4%. 
  • Bloomberg US Financial Conditions Index .31 -6.0 basis points.
  • Volatility Index(VIX) futures 16.6 +.6%.
  • Euro Stoxx 50 futures -.16%.
  • S&P 500 futures -.14%.
  • NASDAQ 100 futures -.15%.  
Morning Preview Links

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

Stocks Slightly Lower into Final Hour on US Policy-Induced Stagflation Fears, Escalating US/China Trade Tensions, Less Dovish FOMC Commentary, Metals & Mining/Gambling Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Most Sectors Declining
  • Volume: Below Average
  • Market Leading Stocks: Underperforming
Equity Investor Angst:
  • Volatility(VIX) 14.1 +3.1%
  • DJIA Intraday % Swing .43%
  • Bloomberg Global Risk On/Risk Off Index 64.5 +1.2%
  • Euro/Yen Carry Return Index 165.4 -.07%
  • Emerging Markets Currency Volatility(VXY) 8.7 +.12%
  • CBOE S&P 500 Implied Correlation Index 19.7 +3.2% 
  • ISE Sentiment Index 131.0 -5.0 points
  • Total Put/Call .83 -32.5%
  • NYSE Arms .76 unch.
Credit Investor Angst:
  • North American Investment Grade CDS Index 68.4 +2.7%
  • US Energy High-Yield OAS 351.9 +.39%
  • Bloomberg TRACE # Distressed Bonds Traded 384.0 -1.0
  • European Financial Sector CDS Index 85.5 +1.6% 
  • Deutsche Bank Subordinated 5Y Credit Default Swap 276.85 +.9%
  • Italian/German 10Y Yld Spread 169.0 basis points -1.0 basis point
  • Asia Ex-Japan Investment Grade CDS Index 114.2 +.6%
  • Emerging Market CDS Index 219.27 +2.1%
  • China Corp. High-Yield Bond USD ETF(KHYB) 25.9 -.56%
  • 2-Year Swap Spread 20.75 basis points unch.
  • TED Spread 18.5 basis points -8.25 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -12.75 +.25 basis point
  • MBS  5/10 Treasury Spread 173.0 +10.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 713.0 unch.
  • Avg. Auto ABS OAS 77.0 -1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 43.4 -.34%
  • 3-Month T-Bill Yield 5.35% +7.0 basis points
  • China Iron Ore Spot 109.8 USD/Metric Tonne +.1%
  • Dutch TTF Nat Gas(European benchmark) 34.4 euros/megawatt-hour  -2.9%
  • Citi US Economic Surprise Index 52.9 -4.1 points
  • Citi Eurozone Economic Surprise Index -146.0 +.5 point
  • Citi Emerging Markets Economic Surprise Index -3.2 -1.2 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(16 of 500 reporting) -20.6% unch.
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 231.44 +.13:  Growth Rate +3.6% +.1 percentage point, P/E 19.2 unch.
  • S&P 500 Current Year Estimated Profit Margin 12.21% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 214.55 +.62: Growth Rate +42.2% +.5 percentage point, P/E 36.4 +.1
  • Bloomberg US Financial Conditions Index .36 -1.0 basis point
  • Bloomberg Euro-Zone Financial Conditions Index -4.17 -6.0 basis points
  • US Yield Curve -101.25 basis points (2s/10s) +7.5 basis points
  • US Atlanta Fed 2Q GDPNow Forecast +1.94% unch.
  • Cleveland Fed Inflation Nowcast Core PCE YoY +4.35% unch.: CPI YoY +3.22% unch.
  • 10-Year TIPS Spread 2.26 unch.
  • Highest target rate probability for Sept. 20th FOMC meeting: 71.6%(+2.5 percentage points) chance of 5.25%-5.5%. Highest target rate probability for  Nov. 1st meeting: 56.5%(+1.6 percentage points) chance of 5.25%-5.5%.
Overseas Futures:
  • Nikkei 225 Futures: Indicating -188 open in Japan 
  • China A50 Futures: Indicating -158 open in China
  • DAX Futures: Indicating +84 open in Germany
Portfolio:
  • Slightly Higher:  On gains in my utility sector longs, index hedges and emerging market shorts
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open:
  • None of note
After the Close: 
  • (LEVI)/.03
Economic Releases  

7:30 am EST

  • Challenger Job Cuts report for June.

8:15 am EST

  • The ADP Employment Change for June is estimated to fall to 225K versus 278K in May.

8:30 am EST

  • The Trade Balance for May is estimated at -$69.0B versus -$74.6B in April.
  • Initial Jobless Claims for last week is estimated to rise to 245K versus 239K the prior week.
  • Continuing Claims is estimated to fall to 1740K versus 1742K prior.

10:00 am EST

  • JOLTS Job Openings for May is estimated to fall to 9900K versus 10103K in April.
  • ISM Services Index for June is estimated to rise to 51.3 versus 50.3 in May.

Upcoming Splits 

  • None of note
Other Potential Market Movers
  • The Eurozone retail sales reports, weekly MBA Mortgage Applications report and the EIA natural gas inventory report could also impact global trading tomorrow.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST

Afternoon Market Internals

NYSE Composite Index:

  • NYSE Volume Running -14.7% Below 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 10.9 +1.0
  • 8 Sectors Declining, 3 Sectors Rising
  • 34.5% of Issues Advancing, 62.6% Declining
  • 41 New 52-Week Highs, 11 New Lows
  • 51.2%(-3.3%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 61.0 -5.0
  • Bloomberg Global Risk-On/Risk-Off Index 64.4 +.9%
  • Russell 1000: Growth/Value 17,448.4 +.57%
  • 1-Day Vix 9.4 -5.4%
  • Vix 14.1 +3.1% 
  • Total Put/Call .82 -33.3%
  • TRIN/Arms .79 +3.95%

Tuesday, July 04, 2023

Wednesday Watch

Evening Headlines

Bloomberg:

Zero Hedge:
Wall Street Journal:  
 TheGatewayPundit.com:
The Epoch Times: 
OpenVAERS:
SKirsch.com:
Night Trading 
  • Asian equity indices are -.5% to unch. on average.
  • Asia Ex-Japan Investment Grade CDS Index 113.5 -2.0 basis points. 
  • China Sovereign CDS 59.75 -.5 basis point.
  • China Iron Ore Spot 108.8 USD/Metric Tonne -.06%.
  • Bloomberg Emerging Markets Currency Index 43.6 +.01%.
  • Bloomberg Global Risk-On/Risk Off Index 64.4 +.9%. 
  • Bloomberg US Financial Conditions Index .32 -5.0 basis points.
  • Volatility Index(VIX) futures 16.4 +.3%.
  • Euro Stoxx 50 futures -.11%.
  • S&P 500 futures -.03%.
  • NASDAQ 100 futures -.15%.  
Morning Preview Links

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