Monday, May 19, 2025

Tuesday Watch

Around X:

  • @ElonMusk
  • @ZeroHedge
  • @MarioNawful
  • THE U.S. CAME DANGEROUSLY CLOSE TO DYSTOPIA. Americans were inches away from mass censorship, thought-policing, and a full corporate-state takeover of speech, culture, and control. The plan? Run Biden, hide his condition, then hand over power to Kamala. All while trying to jail—or eliminate—Trump. The resistance held. The plan cracked. But the threat still lingers. Tyrants don’t disappear—they wait. The price of freedom is eternal vigilance. The fight for liberty never ends.
  • STRIP CLUBS, DRUGS, AND PSYCHICS: PENTAGON CREDIT CARDS FUELED AMERICA'S WILDEST PARTIES. The Pentagon has some explaining to do after government credit cards were flagged for thousands of questionable charges at strip clubs, weed dispensaries, and - perhaps most bizarrely - fortune tellers trying to predict America's next war. House Oversight Committee investigators discovered nearly 8,000 "HIGH-RISK transactions" on Defense Department charge cards, prompting demands for a full GAO audit of government spending at: "Adult entertainment, online dating, gambling, weed, pyramid schemes, massage parlors, timeshares." 
  • BREAKING: 4TH NEW ORLEANS JAIL ESCAPEE CAUGHT—6 STILL ON THE RUN. Gary C. Price, 21, charged with first-degree murder, has been captured after escaping from New Orleans’ main jail Friday. He’s the fourth of ten escapees caught, with six fugitives still loose. More than 200 officers are on the hunt, with rewards hitting $20K per head. 
  • DOJ TO PAY $5M TO ASHLI BABBITT’S FAMILY IN J6 CAPITAL SHOOTING SETTLEMENT. The federal government will pay nearly $5 million to the estate of Ashli Babbitt, the unarmed Air Force veteran shot by Capitol Police during the Jan. 6 riot. The settlement, first reported Monday, comes despite the DOJ previously deeming the shooting justified. Outgoing Capitol Police Chief Manger called the decision “disappointing,” warning it sets a chilling precedent. Babbitt’s family accused the officer of excessive force and negligence. Trump, who has repeatedly hailed Babbitt as a patriot, has demanded amnesty for all Jan. 6 defendants. 
  • BIDEN LIKELY HAD BONE-SPREAD CANCER WHILE IN OFFICE, DOCTOR SAYS. A top oncologist says Biden's aggressive prostate cancer likely began before his presidency. Dr. Ezekiel Emanuel said the cancer’s spread to bone means it had been growing for “more than several years.” That places its origin in or before 2021. He questioned why Biden’s doctors didn’t catch or disclose it, noting past presidents like Obama and Bush were routinely tested. If tests were skipped or results hidden, Emanuel warned, “that would be very troubling.” The White House confirmed the diagnosis but has not addressed the timeline. 
  • CHINA BEGINS BUILDING FIRST SPACE-BASED SUPERCOMPUTER NETWORK. China has officially launched the first 12 satellites of its 2,800-satellite “Three-Body Computing Constellation”—marking the start of the world’s first orbital supercomputer. Each AI-powered satellite processes 744 trillion operations per second and communicates with others via 100Gbps laser links. The system promises 1,000 POPS (peta operations per second) at full scale. These space data centers slash energy costs, bypass Earth’s bandwidth bottlenecks, and enable real-time 3D digital twin generation for emergencies, gaming, and more. Earth-based supercomputers may soon be eclipsed—not by rivals, but by orbit. 
  • CANADA PAUSES SOME U.S. TARIFFS AMID VANCE-CARNEY TALKS. Canada temporarily paused some counter-tariffs against the US, prompting Opposition leader Pierre Poilievre to claim PM Mark Carney had quietly surrendered in the trade war. Finance Minister Francois-Philippe Champagne:  
  • UNCANNY VALLEY: THE AI HYPE CYCLE ISN’T A CURVE—IT’S A CONSTELLATION. There is no singular AI wave. There are hundreds. And they’re all peaking at once. @RichardSocher: “Don’t think of the AI hype cycle as one line—it’s thousands of overlapping ones. From robotics to self-driving to web agents, each AI frontier has its own curve, its own timing, and its own reality.” (video
  • @LauraLoomer
  • Kudos to Kennedy @RobertKennedyJr for calling out the illicit Chinese vapes targeting American kids. It is time for real action to stop these dangerous e-cigs from harming more children. Let’s crack down on China HARD and protect our youth from addiction and harm before China claims any more victims. Today, 90 % of vapes are illegally imported from China, and my home state of Florida is No. 1 in the nation for illicit vape sales, while China has become the world’s leading producer of e-cigarettes. The CCP loves poisoning American Children. Let’s stop them!
  • Democrat Congresswoman @RepLaMonica has been charged for assaulting an ICE agent in New Jersey! Thank you, @AlinaHabba. You may want to keep an eye on homeboy Hakeem who said you will “find out” if his Sista faced “trumped up charges”. Sounds like a threat. (pic)
  • @amuse
  • @TheStormRedux
  • @BGatesIsaPsycho
  • @EricLDaugh
  • @JasonJournoDC
  • @LeadingReport
  • @bennyjohnson 
  • @WarClandestine
  • @Saxon_African
  • @catturd2
  • @VigilantFox
  • NEW: Bernie Sanders says the Democratic establishment despises “DIRTY” working-class people without a PhD. He recalled how thousands of energized, working-class supporters would show up to rallies—only to be met with hostility at official party events. Sanders painted the scene: “There’d be a few hundred people, mostly older, whiter, wealthier. And you saw the clash. The establishment did not want to open the door. They hated the idea that all these people whose hands were a little bit dirty, who didn’t have PhDs or weren’t wealthy…” (video)
Night Trading 
  • Asian equity indices are +.5% to +1.0% on average. 
  • Asia Ex-Japan Investment Grade CDS Index 79.75 -.5 basis point. 
  • China Sovereign CDS 52.25 +.5 basis point.
  • China Iron Ore Spot 99.0 USD/Metric Tonne -.4%
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.65 +.06%.
  • Bloomberg Emerging Markets Currency Index 37.0 -.08%.
  • Bloomberg Global Risk-On/Risk Off Index 70.0 -.9%.
  • US 10-Year Yield 4.45% unch.
  • Volatility Index(VIX) futures 19.9 +1.0%.
  • Euro Stoxx 50 futures +.61%. 
  • S&P 500 futures -.03%. 
  • NASDAQ 100 futures -.08%.
Morning Preview Links

BOTTOM LINE: Asian indices are modestly higher, boosted by industrial and technology 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.

Stocks Slightly Lower into Final Hour on US Debt Downgrade, Technical Selling, Profit-Taking, Energy/Homebuilding Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Lower
  • Sector Performance: Mixed
  • Volume: Below Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 18.1 +4.9%
  • S&P 500 Intraday % Swing .93 +86.5%
  • Bloomberg Global Risk On/Risk Off Index 71.0 +3.1% 
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.64 +.41%
  • Euro/Yen Carry Return Index 182.9 +.2%
  • Emerging Markets Currency Volatility(VXY) 8.40 -.9%
  • CBOE S&P 500 Implied Correlation Index 20.4 +3.3% 
  • ISE Sentiment Index 165.0 +14.0
  • Total Put/Call .90 +28.6%
  • NYSE Arms .86 -1.2%
  • NYSE Non-Block Money Flow -$191.6M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 55.2 -1.3%
  • US Energy High-Yield OAS 425.3 +1.1%
  • Bloomberg TRACE # Distressed Bonds Traded 233.0 unch.
  • European Financial Sector CDS Index 61.6 +.01%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 149.7 +1.5%
  • Italian/German 10Y Yld Spread 101.0 basis points unch.
  • Asia Ex-Japan Investment Grade CDS Index 80.5 +1.4%
  • Emerging Market CDS Index 169.1 +.4%
  • Israel Sovereign CDS 98.7 -1.9%
  • China Corp. High-Yield Bond USD ETF(KHYB) 23.95 +.02%
  • 2-Year SOFR Swap Spread -21.25 basis points unch.
  • 3M T-Bill Treasury Repo Spread 5.75 basis point +1.25 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -2.0 -.25 basis point
  • MBS  5/10 Treasury Spread 153.0 +4.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 617.0 unch.
  • Avg. Auto ABS OAS 64.0 unch.
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 37.0 +.24% 
  • US 10-Year T-Note Yield 4.47% -1.0 basis point
  • 3-Month T-Bill Yield 4.35% +1.0 basis point
  • China Iron Ore Spot 99.7 USD/Metric Tonne +.2%
  • Dutch TTF Nat Gas(European benchmark) 35.2 euros/megawatt-hour +.2%
  • Citi US Economic Surprise Index -10.6 +2.0 points
  • Citi Eurozone Economic Surprise Index 16.0 +.6 point
  • Citi Emerging Markets Economic Surprise Index 27.9 -.7
  • S&P 500 Current Quarter EPS Growth Rate YoY(462 of 500 reporting) +11.5% -.4 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 276.57 +.17:  Growth Rate +12.1% +.1 percentage point, P/E 21.5 unch.
  • S&P 500 Current Year Estimated Profit Margin 13.32% -2.0 basis points
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +29.1% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 425.49 +.28: Growth Rate +23.0% unch., P/E 31.9 -.1
  • Bloomberg US Financial Conditions Index .45 +8.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.27 +6.0 basis points
  • Bloomberg Global Trade Policy Uncertainty Index 7.3 -.4
  • US Yield Curve 48.5 basis points (2s/10s) +2.5 basis points
  • US Atlanta Fed GDPNow Q2 Forecast +2.4% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 38.8% unch.
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.60% unch.: CPI YoY +2.38% unch.
  • 1-Year TIPS Spread 2.89 +3.0 basis points
  • 10-Year TIPS Spread 2.37 +1.0 basis point
  • Highest target rate probability for July 30th FOMC meeting: 66.9% (unch.) chance of 4.25%-4.5%. Highest target rate probability for Sept. 17th meeting: 51.2%(+1.4 percentage points) chance of 4.0%-4.25%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +62 open in Japan 
  • China A50 Futures: Indicating +16 open in China
  • DAX Futures: Indicating +152 open in Germany
Portfolio:
  • Slightly Higher: On gains in my industrial/utility/financial/industrial sector longs and emerging market shorts
  • Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 100% Net Long

Bear Radar

Style Underperformer:

  • Small-Cap Growth -.7%
Sector Underperformers:
  • 1) Alt Energy -3.2% 2) Oil Service -1.9% 3) Energy -1.7%
Stocks Falling on Unusual Volume: 
  • IGT, SANM, EH, QUBT, ASTS, FSLR, TSSI, LQDA, ACHR and AEVA
Stocks With Unusual Put Option Activity:
  • 1) NVAX 2) AAP 3) LTBYA 4) CARR 5) QS
Stocks With Most Negative News Mentions:
  • 1) QS 2) GOCO 3) SOUN 4) RUN 5) ZYXI
Sector ETFs With Most Negative Money Flow:
  • 1) XLF  2) IGV 3) XLI 4) XLV 5) XLB

Bull Radar

Style Outperformer:

  • Large-Cap Value +.1%
Sector Outperformers:
  • 1) Gold & Silver +1.6% 2) Healthcare Providers +1.0% 3) I-Banks +.9%
Stocks Rising on Unusual Volume:
  • SOC, RXST, TECX, CAPR, CRWV, BGC, SMLR, CEP, SUPV, QBTS, TXNM, UNH, ZIM, BBAR, MRNA, BMA, RYAAY, CEPU, ASIX, TGS, TEO, GSL, PAM, KEP, BBNX, TIC, DXYZ, CCIR, HUM, NICE, NVO and CRESY
Stocks With Unusual Call Option Activity:
  • 1) TBT 2) NVAX 3) XSMO 4) LAES 5) SOC
Stocks With Most Positive News Mentions:
  • 1) NVAX 2) SOC 3) NWTN 4) ZIM 5) BGC
Sector ETFs With Most Positive Money Flow:
  • 1) FDN 2) SMH 3) VGT 4) XLP 5) XHB
Charts:

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

Earnings of Note 
Company/Estimate 

Before the Open:
  • (EXP)/2.48
  • (HD)/3.59
  • (HOV)/2.45
  • (VIPS)/4.35
After the Close:
  • (KEYS)/1.65
  • (MOD)/.95
  • (PANW)/.77
  • (TOL)/2.83
Economic Releases

8:30 am EST

  • The Philly Fed Non-Manufacturing Activity Index for May.

Upcoming Splits

  • (FAST) 2-for-1
Other Potential Market Movers
  • The Fed's Collins speaking, Fed's Kugler speaking, Fed's Barkin speaking, weekly US retail sales reports, RBC Capital Healthcare Conference, Barclays Fintech Conference, JPMorgan Homebuilding/Building Products Conference, (TW) annual meeting, (MCD) annual meeting, (GAP) annual meeting, (HON) annual meeting, (W) annual meeting, (BURL) annual meeting, (CDW) annual meeting, (VSH) annual meeting and the B. Riley investment conference could also impact global trading tomorrow.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

  • Volume Running -10.9% Below 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 34.2 +14.4
  • 6 Sectors Declining, 5 Sectors Rising
  • 29.3% of Issues Advancing, 68.7% Declining 
  • TRIN/Arms .62 -28.7%
  • Non-Block Money Flow -$189.8M
  • 55 New 52-Week Highs, 8 New Lows
  • 43.6% (-2.4%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 65.5 -.7
Other:
  • Bloomberg Global Risk-On/Risk-Off Index 70.4 +2.2%
  • Bloomberg Cyclicals/Defensives Index 240.6 -.4%
  • Russell 1000: Growth/Value 20,958.8 -.22%
  • CNN Fear & Greed Index 70.0 (GREED) unch.
  • 1-Day Vix 11.7 -12.9%
  • Vix 18.5 +7.1%
  • Total Put/Call .99 +41.4%