Monday Watch

Night Trading

• Asian indices are -.25% to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 67.5 unch.
• China Sovereign CDS 36.5 unch.
• China Iron Ore Spot 96.05 USD/Metric Tonne +.09%.
• Crude Oil 82.20/bbl. -.3%
• Gold 4,464.0 USD/t oz. +.62% 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.30 -.12%. 
  
• Bloomberg Emerging Markets Currency Index 34.4 +.01%.
• Bloomberg Global Risk-On/Risk Off Index 129.8 +.2%.
• US 10-Year Yield 4.68% -1.0 basis point. 
• Japan 30-Year Yield 4.06% +3.0 basis points. 
• Volatility Index(VIX) futures 18.0 +.2%. 
• Euro Stoxx 50 futures +.21%.
• S&P 500 futures +.08%.
• NASDAQ 100 futures +.25%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly lower, weighed down by real estate and utility shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% Net Long heading into the week.

Friday Watch

Around X:

• @Business

• Trump has agreed to Australia’s request to “consider full exemption or, at the very least, no increase” to the tariffs imposed by the US, Albanese says.  
• A second supertanker appeared moored at Saudi Arabia’s main oil export terminal inside the Persian Gulf, a further sign that loadings at the hub may be picking up. 
• An influx of Middle Eastern crude is making its way to US shores, offering some respite to a market squeezed by wartime demand for American exports. 
• President Trump ordered the Navy to return to using steam catapults to launch planes off of aircraft carriers, acting on a longtime complaint despite opposition from many naval officers. 
• Tyson Foods said it would close several additional beef plants, in the latest sign of the US beefpacking industry’s restructuring amid a prolonged US cattle shortage.  
• The Trump administration referred over 200 hospitals and clinics for investigations into what it says are possible violations of federal statutes related to pediatric gender-affirming care.
• The top 100% rate will apply to drones of a certain size or those that posses national-security capabilities, according to a White House statement. 
• US mortgage rates fell slightly for the first time since in six weeks, after fresh data revealed that the labor market is cooling and the Iran war may have had a more muted impact on inflation last month. 
• The AI firms want customers to rethink the price of using their models. 
• Here’s what you need to know to start your day. 
• Get up to speed on what's moving global markets. 

• @ZeroHedge

• US Sending Fresh Carrier To Relieve Over-Extended USS Lincoln Amid Reports Of Sailor Burn-Out. 
• Bessent says US ‘to apply measures’ on Iran that ‘have never been seen in history’. 
• Nanya Technology Plans New Taiwan DRAM Plants: EDN. 
• US Creates New 'Multinational' Attack Drone Task Force Amid Iran War & Lessons Learned In Ukraine. 
• State Department Launches Birth Tourism Prevention Task Force.
• The "Big Tent" Dilemma: Marxist Hasan Piker Pleads With Democrats For Help, But Will They Answer.
• Outrage As Texas Schools Bus Kids To Mosque So They Can "Experience Islam".
• Violent Crime Rate Drops In Major US Cities.
• News Groups Sue Trump Over Paid Early Access To Truth Social Posts.
• *VANCE ON IRAN: ENDS WITH IRAN HAVING NO NUCLEAR WEAPON. *VANCE ON IRAN: ALSO ENDS WITH HORMUZ BACK TO STABLE OIL PRICES. *VANCE: GOAL ONE IS TO KEEP OIL AND GASOLINE CHEAP FOR US.
• Lots of explosions in Europe today.
• Workday Soars Most On Record As Silver Lake Weighs $43 Billion Buyout. 
• Citadel Imposes Two-Year Non-Competes Even on Some Analysts: BBG.
• Disinflation, Deal-Doubts, & Doubling-Down: Bond Yields Drop, Oil Slop, Tech Pops.        

• @CNBC  

• CNBC Daily Open: An 'indefinite' war, and a record-breaking rally. 
• Friday's big stock stories: What’s likely to move the market in the next trading session.    
• Stock futures are little changed after S&P 500 sets record above 7,800, heads for winning week: Live updates. 
• Uber partners with China's Pony.ai for 2,000 robotaxis in Europe. 
• Reddit shares jump 11% on inclusion in S&P 500. 
• These charts show why stocks keep rallying. Profit margins are the highest on record. 

• @WallStEngine

• Ramp’s July AI Index: Anthropic was used by 43.5% of U.S. businesses, up 1.1pp MoM. OpenAI: 39.7%, +0.23pp. xAI: 4.0%, +0.94pp. Anthropic’s Fable 5 accounted for just 6% of tokens purchased and 11.4% of spend. GPT-5.6 Sol accounted for 25% of OpenAI tokens and 23% of spend.  
• WHITE HOUSE TO HOST CRYPTO, PREDICTION MARKET EXECUTIVES NEXT WEEK: POLITICO.
• APPLIED MATERIALS $AMAT Q3’26 EARNINGS HIGHLIGHTS. Revenue: $9.12B (Est. $8.99B) ; +25% YoY. Adj. EPS: $3.50 (Est. $3.39) ; +41% YoY. Non-GAAP Oper Income: $3.10B (Est. $3.03B). Non-GAAP FCF: $2.33B (Est. $1.52B) ; +14% YoY. Q4 Guide: Revenue: $10.25B +/- $500M (Est. $9.54B). Adj. EPS: $4.02 +/- $0.20 (Est. $3.69).  

Night Trading 

• Asian equity indices are -.5% to +.75% on average. 
• Asia Ex-Japan Investment Grade CDS Index 67.25 -.5 basis point. 
• China Sovereign CDS 36.5 -.25 basis point.
• China Iron Ore Spot 96.50 USD/Metric Tonne +1.0%. 
• Crude Oil 81.10/bbl. -.2% 
• Gold 4,375.30 USD/t oz. -1.0%. 
• Swiss Franc/Offshore Chinese Renminbi Cross 8.29 -.03%.
• Bloomberg Emerging Markets Currency Index 34.41 -.02%.
• Bloomberg Global Risk-On/Risk Off Index 128.6 +.3%.
• US 10-Year Yield 4.65% unch.
• Japan 30-Year Yield 4.02% -1.0 basis point.
• Volatility Index(VIX) futures 18.1 -.1%.
• Euro Stoxx 50 futures +.34%. 
• S&P 500 futures +.05%.
• NASDAQ 100 futures -.04%.

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by financial and technology shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the day.

Stocks Rising into Final Hour on Declining Fed Rate-Hike Odds, Diminished War-Induced Inflation Fears, AI Infrastructure Build-Out Optimism, Tech/Transport Sector Strength

Economic/Market Gauges:

• North American Investment Grade CDS Index 50.60 -1.2%
• BofA Private Credit Proxy Index 75.0 +1.7% 
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .28 -1.0 basis point
• BofA Global Financial Stress Indicator -.18 -2.0 basis points
• European Financial Sector CDS Index 53.3 -1.2%
• Emerging Market CDS Index 138.5 -1.7%
• Israel Sovereign CDS 54.0 -2.5%
• Bloomberg Global Trade Policy Uncertainty Index .6 -.1
• US Morning Consult Daily Consume Sentiment Index 89.5 -1.6

• Citi US Economic Surprise Index 23.0 -2.6

• Citi Eurozone Economic Surprise Index 69.9 +1.2

• Citi Emerging Markets Economic Surprise Index 30.6 +4.5
• S&P 500 Current Quarter EPS Growth Rate YoY(454 of 500 reporting) +50.6% -.2 percentage point
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 389.05 +.46:  Growth Rate +32.2% +.1 percentage point, P/E 20.0 +.1
• S&P 500 Current Year Estimated Profit Margin 16.25% +1.0 basis point
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(8 of 10 reporting) +138.4% unch.
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 945.25 +.49: Growth Rate +82.3% +.1 percentage point, P/E 19.8 +.2
• Bloomberg US Financial Conditions Index 1.41 +12.0 basis points
• US Yield Curve 49.75 basis points (2s/10s) +1.5 basis points
• Bloomberg Industrial Metal Index 179.4 -.7%
• Dutch TTF Nat Gas(European benchmark) 60.7 euros/megawatt-hour -.6%
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 14.7% unch.
• US Atlanta Fed GDPNow Q3 Forecast +5.8% unch.
• US 10-Year T-Note Yield 4.64% -5.0 basis points
• 1-Year TIPS Spread 1.64 -4.0 basis points

• Highest target rate probability for Oct. 28th FOMC meeting: 52.4% (+7.5 percentage points) chance of 3.5%-3.75%. Highest target rate probability for Dec. 9th meeting: 44.9%(-.2 percentage point) chance of 3.75%-4.0%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +1,030 open in Japan 
• China A50 Futures: Indicating -6 open in China
• KOSPI 200 Futures: Indicating +26 open in South Korea 

• DAX Futures: Indicating +160 open in Germany

Portfolio:

• Higher: On gains in my financial/tech/consumer discretionary/industrial sector longs
• Disclosed Trades: None
• Market Exposure: 100% net long

Bear Radar

Style Underperformer:

• Small-Cap Growth +.1%

Sector Underperformers:

• 1) Gold & Silver -2.8% 2) Telecom -1.8% 3) Space -.7%

Stocks Falling on Unusual Volume: 

• NBIS, PHVS, CAE, SEPN, COHR, BLTE, LQDA, PLGO, ANDG, JD, PESI, CSCO, PAAS, IDR, YETI, CBRS, TPR, REZI, LFTO and CLBT

Stocks With Unusual Put Option Activity:

• 1) BIRK 2) LEN 3) IRM 4) XLY 5) UAMY

Stocks With Most Negative News Mentions:

• 1) NI 2) WRD 3) TE 4) DJT 5) GTM

Sector ETFs With Most Negative Money Flow:

• 1) XLP 2) XLE 3) FDN 4) XLF 5) XLK

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +1.1%

Sector Outperformers:

• 1) Computer Hardware +4.9% 2) AI Innovation +2.4% 3) Shipping +2.4%

Stocks Rising on Unusual Volume:

• ARX, OMER, AIRO, TBBB, SNDK, EROC, AVAH, BIRK, MH, QMCO, ISSC, ASMB, FIGR, WIX, MWH, AEBI, COLL, ASMB, WDC, BLSH, ZIM ADUR, HLIT, AAON, SMCI, CLS, GO, GDS, P, ABCL, NET, ATRO, SHAZ, RDVT, FOUR, MRX, NNE, DRTS, KURA, FA, ADIG, ENS, LMRI, SAIA, HUBG, CNNE, TEN, HPQ, MTZ, ECO, IMXI, GMRS, BRSL, SGI, LIFE, APP, POR and NOMD

Stocks With Unusual Call Option Activity:

• 1) GBTC 2) DGXX 3) VYM 4) UMC 5) NRGV 

Stocks With Most Positive News Mentions:

• 1) NBIS 2) SMCI 3) CRWV 4) LITE 5) CAVA

Sector ETFs With Most Positive Money Flow:

• 1) SOXX 2) IBB 3) GDX 4) CLOU 5) XOP

Charts: 

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

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

Earnings of Note 
Company/Estimate 

Before the Open:

• None of note

After the Close: 

• None of note

Economic Releases 

8:30 am EST

• Retail Sales Advance MoM for July is estimated to rise +.1% versus a +.2% gain in June.
• Retail Sales Ex Autos MoM for July is estimated to rise +.2% versus a -.2% decline in June.
• Retail Sales Ex Autos and Gas for July is estimated to rise +.3% versus a +.4% gain in June. 

10:00 am EST

• Univ. of Mich. Consumer Confidence for Aug. is estimated to fall to 54.9 versus 55.2 in July.
• Univ. of Mich. 1Y Inflation Expectations Index for August is estimated to rise +4.2% versus a +4.2% gain in July.
• Business Inventories for June is estimated to rise +.1% versus a +.3% gain in May. 

Upcoming Splits

• (BYND) 1-for-30

Other Potential Market Movers

• The Atlanta Fed GDPNow Q3 update, weekly US Baker Hughes rig count and the weekly CFTC speculative net positioning reports could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST