Monday, April 30, 2018

Tuesday Watch

Night Trading 
  • Asian equity indices are unch. to +.5% on average.
  • Asia Ex-Japan Investment Grade CDS Index 73.25 -1.75 basis points
  • Asia Pacific Sovereign CDS Index 12.0 -.5 basis point
  • Bloomberg Emerging Markets Currency Index 73.28 unch.
  • FTSE 100 futures -.15%.
  • S&P 500 futures +.15%.
  • NASDAQ 100 futures +.13%.
Morning Preview Links

Earnings of Note
Company/Estimate
  • (AET)/3.01
  • (AGCO)/.12
  • (ADM)/.52
  • (AN)/1.00
  • (BP)/.11
  • (EAT)/1.03
  • (CMI)/2.94
  • (DISH)/.69
  • (EMR)/.72
  • (FDP)/.91
  • (HBI)/.24
  • (HCA)/2.07
  • (JCI)/.52
  • (LLL)/2.01
  • (LL)/-.04
  • (MLM)/.37
  • (MRK)/1.00
  • (PFE)/.74
  • (RDC)/-.80
  • (SMG)/3.31
  • (STX)/1.33
  • (UAA)/-.05
  • (ALL)/2.60
  • (APC)/.41
  • (AAPL)/2.68
  • (CHRW)/1.00
  • (COHR)/3.49
  • (CXO)/.77
  • (GILD)/1.67
  • (JNPR)/.25
  • (MDLZ)/.61
  • (NBR)/-.29
  • (TRUP)/-.04
  • (ZEN)/-.03
Economic Releases
10:00 am EST
  • Construction Spending MoM for March is estimated to rise +.5% versus a +.1% gain in February. 
  • ISM Manufacturing for April is estimated to fall to 58.4 versus 59.3 in March.
  • ISM Prices Paid for April is estimated to rise to 78.5 versus 78.1 in March.
Afternoon: 
  • Wards Total Vehicle Sales for April is estimated to fall to 17.1M versus 17.4M in March.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Australia Central Bank decision, weekly US retail sales reports, (CE) investor day and the Steel/Aluminum tariff exclusions for certain countries expiring could also impact trading today.
BOTTOM LINE:  Asian indices are mostly higher, boosted by consumer and commodity 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 Reversing Lower into Final Hour on Geopolitical Fears, Earnings Outlook Worries, Emerging Markets Debt Angst, Telecom/Homebuilding Sector Weakness

Broad Equity Market Tone:
  • Advance/Decline Line: Lower
  • Sector Performance: Most Sectors Declining
  • Volume: Around Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 15.7 +2.1%
  • Euro/Yen Carry Return Index 137.45 -.21%
  • Emerging Markets Currency Volatility(VXY) 8.30 -.12%
  • S&P 500 Implied Correlation 42.81 +.59%
  • ISE Sentiment Index 80.0 -8.05%
  • Total Put/Call .88 +1.15%
  • NYSE Arms 1.12 +1.87%
Credit Investor Angst:
  • North American Investment Grade CDS Index 60.76 +1.11%
  • America Energy Sector High-Yield CDS Index 399.0 -1.40%
  • European Financial Sector CDS Index 57.0 +.97%
  • Italian/German 10Y Yld Spread 122.50 +5.5 basis points
  • Asia Pacific Sovereign Debt CDS Index 12.04 +.84%
  • Emerging Market CDS Index 142.39 +1.29%
  • iBoxx Offshore RMB China Corporate High Yield Index 149.39 -.03%
  • 2-Year Swap Spread 25.75 +.75 basis point
  • TED Spread 55.0 -.25 basis point
  • 3-Month EUR/USD Cross-Currency Basis Swap -10.5 -1.5 basis points
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 73.28 -.42%
  • 3-Month T-Bill Yield 1.8% -1.0 basis point
  • Yield Curve 45.5 -2.5 basis points
  • China Iron Ore Spot 65.63 USD/Metric Tonne unch.
  • Citi US Economic Surprise Index 41.8 -4.2 points
  • Citi Eurozone Economic Surprise Index -77.50 +5.9 points
  • Citi Emerging Markets Economic Surprise Index 3.2 -5.5 points
  • 10-Year TIPS Spread 2.18 +1.0 basis point
  • 92.7% chance of Fed rate hike at June 13 meeting, 93.2% chance at August 1 meeting
Overseas Futures:
  • Nikkei 225 Futures: Indicating +11  open in Japan 
  • China A50 Futures: Indicating +90 open in China
  • DAX Futures: Indicating -42 open in Germany
Portfolio: 
  • Slightly Lower: On losses in my retail/medical/biotech/industrial sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

Bear Radar

Style Underperformer:
  • Mid-Cap Value -.2%
Sector Underperformers:
  • 1) Telecom -1.8% 2) Homebuilders -1.7% 3) Biotech -1.2%
Stocks Falling on Unusual Volume: 
  • VAC, ANDX, MPC, ARNC, TMUS, CTB, KPTI, FSLR, INT and MCY
Stocks With Unusual Put Option Activity:
  • 1) ADM 2) TMUS 3) ANDV 4) MPC 5) DISH
Stocks With Most Negative News Mentions:
  • 1) W 2) GSUM 3) CL 4) CTV 5) OC
Charts:

Bull Radar

Style Outperformer:
  • Small-Cap Value +.2%
Sector Outperformers:
  • 1) Coal +3.7% 2) Restaurants +1.5% 3) Gaming +.8%
Stocks Rising on Unusual Volume:
  • FNGN, CHEK, DCT, ANDV, ILG, BWP, FDC, MCD, DOVA, CHTR, WPP, USCR, AKAO, IMMU, AQ, FCN, EQGP, CIFS, NSP, TRNO, FR, KMPR, CHGG, ANIK and WUBA
Stocks With Unusual Call Option Activity:
  • 1) FDC 2) ILG 3) CPB 4) HBI 5) P
Stocks With Most Positive News Mentions:
  • 1) MCD 2) NYT 3) FIT 4) EVIO 5) EPD
Charts:

Morning Market Internals

NYSE Composite Index:

Sunday, April 29, 2018

Monday Watch

Today's Headlines
Bloomberg:
  • China Factory Gauge Holds Up as Services Beat Forecast. A gauge of activity at China’s manufacturers remained robust as services strengthened for a second month, signaling that the economic expansion is intact. The manufacturing purchasing managers index stood at 51.4 in April versus the 51.3 estimate in a Bloomberg survey and 51.5 last month. The non-manufacturing PMI, covering services and construction, rose to 54.8 the statistics bureau said Monday, beating estimates. Levels above 50 indicate improvement.
  • Ross Says U.S. to Extend Duty Relief to Some Allies, But Not All.  
  • Asia Stocks Open Mixed; Korean Shares, Won Climb: Markets Wrap. (video) Equities in Seoul advanced with the won after North Korea pledged denuclearization on Friday ahead of the upcoming summit between Kim Jong Un and U.S. President Donald Trump. Australian shares gained with Hong Kong equity futures. Results from tech giants Microsoft Corp., Intel Corp. and Amazon.com Inc. boosted U.S. shares at the end of last week. Yields on 10-year Treasuries retreated further from the highest since 2014, hit earlier in the week. The Kospi index gained 0.4 percent asof 9:31 a.m. in Seoul. Australia’s S&P/ASX 200 Index rose 0.3 percent. Futures on Hong Kong’s Hang Seng Index climbed 0.4 percent.S&P 500 futures were up 0.1 percent. The underlying gauge climbed 0.1 percent on Friday. The MSCI Asia Pacific Index gained 0.1 percent.
MarketWatch.com:
Night Trading
  • Asian indices are unch. to +.75% on average.
  • Asia Ex-Japan Investment Grade CDS Index 74.25 -.75 basis point.
  • Asia Pacific Sovereign CDS Index 12.0 -.5 basis point.
  • Bloomberg Emerging Markets Currency Index 73.63 +.05%.
  • FTSE 100 futures +.10%.
  • S&P 500 futures +.11%.
  • NASDAQ 100 futures +.26%.

Earnings of Note
Company/Estimate
  • (AMG)/3.89
  • (AKS)/.03
  • (DO)/-.19
  • (L)/.78
  • (MCD)/1.67
  • (AKAM)/.70
  • (CGNX)/.20
  • (MTZ)/.21
  • (RCII)/.13
  • (THC)/-.04
  • (RIG)/-.37
  • (VNO)/.52
Economic Releases
8:30 am EST
  • Personal Income for March is estimated to rise +.4% versus a +.4% gain in February.
  • Personal Spending for March is estimated to rise +.4% versus a +.2% gain in February. 
  • Real Personal Spending for March is estimated to rise +.5% versus unch. in February. 
  • The PCE Core MoM for March is estimated +.2% versus a +.2% gain in February.
9:45 am EST
  • The Chicago Purchasing Manager for April is estimated to rise to 58.0 versus 57.4 in March.
10:00 am EST
  • Pending Home Sales MoM for March are estimated to rise +.5% versus a +3.1% gain in February.
10:30 am EST
  • The Dallas Fed Manufacturing Activity Index for April is estimated to rise to 25.0 versus 21.4 in March.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The China Manufacturing PMI report and the Eurozone CPI report could also impact trading today.
BOTTOM LINE: Asian indices are mostly higher, boosted by technology and industrial shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 75% net long heading into the week.