Thursday Watch

Evening Headlines

Bloomberg:                             

• Australia PM Defiant After China Airs 14 Grievances.
• Asia Stocks Slip on Virus Curbs; Treasuries Gain: Markets Wrap.  Asian stocks are poised to end their longest winning run since 1988 as restrictions to curb the coronavirus spread overshadowed progress toward a vaccine. Treasuries gained. Stocks had modest declines in Japan, Australia and South Korea. S&P 500 futures were little changed with the benchmark closing at its session low after New York City shut schools because of rising infections. Pfizer Inc. advanced after saying its vaccine was 95% effective, paving the way to apply for the first U.S. regulatory authorization for a coronavirus shot within days. The Bloomberg Dollar Spot Index headed higher after earlier falling to the lowest since April 2018 as vaccine optimism lifted commodity prices and resource-linked currencies. An MSCI gauge of Asian stocks had risen for 13 consecutive sessions to Wednesday. S&P 500 futures were little changed as of 9:10 a.m. in Tokyo. The S&P 500 Index fell 1.2%. Topix index fell 0.4%. The MSCI Asia Pacific Index fell 0.4%. Australia’s S&P/ASX 200 Index fell 0.4%. Kospi index fell 0.5%. Hong Kong’s Hang Seng Index futures were little changed earlier.
• China Absorbs Yuan, Dimon Scolds, Virus Hotspots’ Rates: Eco Day.
• Oil Pares Gains as Fresh Virus Curbs Stoke Demand Concerns.
• U.S. Deaths Surpass 250,000; NYC to Shut Schools: Virus Update.  
• Covid Ravaging Long-Term Care Centers at Fastest Pace Since May.
• NYC Recovery at Risk on Double Whammy of School-and-Subway Pain.  
• Fannie-Freddie Watchdog Demands Capital Above $280 Billion.  
• Victoria’s Secret Owner Rises as Quarterly Sales Beat Estimates.

Wall Street Journal:

• Gretchen Whitmer Strikes Again.
• 2020 Reshapes Black Friday.
• In Minnesota and Beyond, ‘Defund the Police’ Weighed on Democrats.

Fox News: 

• How many of his own COVID restrictions did Newsom break at party as Calif. cases rise?
  

CNBC.com:

• Payment company Affirm files to go public with revenues doubling year-over-year.
• Nvidia beats on both earnings and revenue, sales up 57%.
• Stocks making the biggest moves after hours: Sonos, L Brands, Palantir & more.

MarketWatch.com:         

• Trump calls Georgia recount a ‘joke’ as certification date looms.

Zero Hedge:

• Georgia Recount Monitor Catches 9,626-Vote Error During Hand Recount.    
• "No One Is Bigger Than The Party": At Crucial Juncture In US/China Relations, Xi Aims To Consolidate Power.
• Iran Is Already Warming Up To Biden, Suggesting Cancelling Sanctions And Rejoining The Nuclear Deal.
• Parler CEO Defends Free Speech: "It's Not Against The Law To Have Those Opinions".
• China Used 'Secret Microwave Pulse Weapon' Against Indian Troops In Border Battle.
• US COVID-19 Deaths Top 250,000 As Mortality Worst Since Spring: Live Updates.
• As Clock Ticks On Election Certifications, Here's Where Trump Legal Challenges Stand.
• NYC Restaurants Face 'Double Whammy' Of New Restrictions And Old Man Winter 
• Ten Geopolitical Risks To Watch In The Coming Year.
• GM Recalling Over 50,000 Chevy Bolts That Can "Catch Fire When Charged To Nearly Full Capacity"
• Bitcoin Jumps, Stocks Dump After Vaccine-Pop Flops.

Newsmax:

• Pa. High Court to Hear Trump Challenge to Thousands of Votes.
• Dick Morris to Newsmax TV: 'Georgia May Well Be Overturned'.

@kylenabecker:

• Dominion Voting Systems. "Results are loaded directly from the encrypted Memory Card"... This is the first of SIX Dominion Training Videos leaked from a NON-PUBLIC SOURCE. They reveal just how *shockingly* vulnerable the voting system is. Dominion does *not* wants us to see this. Watch:

 @RealDonaldTrump: 

• Look at this in Wisconsin! A day AFTER the election, Biden receives a dump of 143,379 votes at 3:42AM, when they learned he was losing badly. This is unbelievable!

The Epoch Times:

• McKinsey Under Pressure for Its China Ties.
• Chinese-American Raytheon Engineer Sentenced to Prison for Technology Exports.
  

Protectthevote.com:

• Trump campaign seeks recount in liberal Milwaukee and Dane.

Digital Blackboard:

• Daily New Cases by Region.

Worldometer:

• New Cases/Deaths by state.

Rt Covid-19:

• How fast virus is growing by state.

KFF:

• State Data(Tests/Hospitalizations).

Night Trading 

• Asian equity indices are -.5% to unch. on average.

• Asia Ex-Japan Investment Grade CDS Index 60.5 +.25 basis point.

• China Sovereign CDS 32.0 -1.0 basis point.

• Bloomberg Emerging Markets Currency Index 61.16 -.08%.
• Bloomberg Global Risk-On/Risk Off Index 1,046.0 +6.0 points.
• Volatility Index(VIX) futures 24.85 -.10%
• FTSE 100 futures -.94%.

• S&P 500 futures -.04%.

• NASDAQ 100 futures -.13%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (BJ)/.65
• (CPB)/.91
• (CSIQ)/-.24
• (M)/-.82
• (NTES)/2.93
• (SINA)/.77
• (PLCE)/.51
• (WB)/.60
  

After the Close:

• (HP)/-.75
• (INTU)/.42
• (POST)/.77
• (ROST)/.62
• (WSM)/1.48
• (WDAY)/.67
  

Economic Releases

8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 700K versus 709K the prior week.
• Continuing Claims are estimated to fall to 6400K versus 6786K prior.
  

10:00 am EST

• The Leading Index for Oct. is estimated to rise +.7% versus a +.7% gain in Sept.
• Existing Home Sales for Oct. is estimated to fall to 6.46M versus 6.54M in Sept.
  

11:00 am EST

• Kansas City Fed Manufacturing Activity for Nov. is estimated to fall to 11.0 versus 13.0 in Oct.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Japan Inflation Data report, Bloomberg Economic Expectations Index for Nov., weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report, BofA Consumer/Retail Conference, Deutsche Bank Gaming/Loding/Leisure/Restaurant Conference, Canaccord Medtech/Diagnostics Forum, (DOV) investor meeting, (TRN) investor day and the JPMorgan Services Investor Conference could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are lower, weighed down by technology and industrial shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.

Stocks Reversing Lower into Final Hour on Mounting US Voter Fraud Evidence, Virus Shutdown Worries, Technical Selling, Biotech/Metals&Mining Sector Weakness

 Broad Equity Market Tone:

• Advance/Decline Line: Around Even
  

• Sector Performance: Mixed
  

• Volume: Above Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 23.1 +1.7%
• Bloomberg Global Risk On/Risk Off Index 1,101.0 -10.0 points

• Euro/Yen Carry Return Index 127.48 -.36%

• Emerging Markets Currency Volatility(VXY) 10.47 -.19%

• S&P 500 Implied Correlation 38.9 -2.7%

• ISE Sentiment Index 134.0 +11.0 points
  

• Total Put/Call .70 -18.6%

• NYSE Arms 1.06 +24.7%

Credit Investor Angst:

• North American Investment Grade CDS Index 52.97 +.66%
  

• US Energy High-Yield OAS 712.89 -1.39%

• European Financial Sector CDS Index 62.90 -1.15%

• Italian/German 10Y Yld Spread 121.0 +1.0 basis piont
  

• Asia Ex-Japan Investment Grade CDS Index 60.31 +.25%
  

• Emerging Market CDS Index 170.04 -2.08%
  

• iBoxx Offshore RMB China Corporate High Yield Index 181.27 -.15%

• 2-Year Swap Spread 8.25 -.5 basis point

• TED Spread 14.0 -.5 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -14.0 -1.0 basis points
  
• MBS  5/10 Treasury Spread  73.75 +.5 basis point
  
• IHS Markit CMBX BBB- 6 71.0 +1.0 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.28 +.20%
• 3-Month T-Bill Yield .08% unch.

• Yield Curve 68.0 -5.5 basis points
  

• China Iron Ore Spot 123.50 USD/Metric Tonne +.46%

• Citi US Economic Surprise Index 66.4 -1.5 points

• Citi Eurozone Economic Surprise Index 109.2 +6.8 points
  

• Citi Emerging Markets Economic Surprise Index 58.5 -.8 point

• 10-Year TIPS Spread 1.71 -1.0 basis point
• 100.0% chance of no change at Jan. 27th meeting, 100.0% chance of no change at March 17th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +72 open in Japan 
• China A50 Futures: Indicating +10 open in China

• DAX Futures: Indicating -53 open in Germany

Portfolio:

• Slightly Lower: On losses in my biotech/medical sector longs
  

• Disclosed Trades: None
  

• Market Exposure: 50% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Growth -.5%

Sector Underperformers:

• 1) Gold & Silver -2.7% 2) Medical Equipment -1.4% 3) Steel -1.2%

Stocks Falling on Unusual Volume: 

• FUBO, EGAN, A, KURA, LTHM, SPT, TMO, LB, MRNA, CIEN, RGEN, FGEN, PII, RAMP, EBS, ASO, NCLH, SIBN, ORA, LOW, GDRX, GTHX, AVYA and ROOT
  

Stocks With Unusual Put Option Activity:

• 1) BX 2) GRPN 3) FCEL 4) DISH 5) LOW
  

Stocks With Most Negative News Mentions:

• 1) PAYS 2) ATEX 3) TGLS 4) GDRX 5) NCLH
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +.2%

Sector Outperformers:

• 1) Oil Service +3.1% 2) Airlines +2.5% 3) Gaming +1.9%

Stocks Rising on Unusual Volume:

• KOD, NKLA, RIDE, SDC, TEN, HZO, DMYT, PCG, ODP, DEN, FTAI, WES, REZI, TGT, BLNK, EB, PTGX and LZB
  

Stocks With Unusual Call Option Activity:

• 1) FTAI 2) A 3) XLY 4) MITT 5) TGT

Stocks With Most Positive News Mentions:

• 1) TGT 2) TJX 3) GE 4) KSS 5) NIO
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +26.7% Above 100-Day Average
• 7 Sectors Rising, 4 Sectors Declining
• 65.3% of Issues Advancing, 31.5% Declining
• 137 New 52-Week Highs, 2 New Lows
• 79.9% of Issues Above 200-day Moving Average
• Average 14-Day RSI 57.1% 
• Bloomberg Global Risk-On/Risk-Off Index 1,175.0 +63.0 points
• Vix 21.9 -3.4%
• Total Put/Call .69 -19.8%
• TRIN/Arms .95 +11.8%

Wednesday Watch

Evening Headlines

Bloomberg:                             

• China’s Credit Jitters Deepen a Selloff in Government Bonds.
• Tokyo Bolsters Push to Lure Business From Hong Kong: NEF Update.  
• Bill Clinton Says China’s Direction Under Xi Upended U.S. Ties.
• Asian Stocks See Muted Start; Treasuries Steady: Markets Wrap. Asian stocks were mixed Wednesday after U.S. shares retreated as investors weighed escalating Covid-19 cases against optimism over a vaccine. Treasuries were steady after an overnight rise. Stocks fell in Japan, and edged up in Australia and South Korea. S&P 500 futures fluctuated after the gauge pulled back from a record high earlier. Pharmacy chains were among the worst performers after Amazon.com Inc. unveiled a new push into prescription drugs. Treasury yields and the dollar held declines as Federal Reserve Chair Jerome Powell said the U.S. economy still has a “long way to go” before it fully recovers from the pandemic. Elsewhere, China stocks will be in focus as the U.S. Securities and Exchange Commission is pushing ahead with a plan that threatens to kick Chinese companies off U.S. stock exchanges. Oil slipped and gold was little changed.
• Oil Retreats After Report Points to Swelling U.S. Stockpiles.
• Trump Orders Troop Drawdown in Iraq, Afghanistan by Jan. 15.
• Zuckerberg, Dorsey Face Angry Lawmakers Still Split on Concerns.  
• America’s Zombie Companies Have Racked Up $1.4 Trillion of Debt.

Wall Street Journal:

• Moderna and Pfizer Are Reinventing Vaccines, Starting With Covid.
• Behind the Elite Hatred of Clarence Thomas.
• A Vaccine Is Already Helping.
• Doctors Apply Covid-19 Lessons Learned as Cases Surge.
• Zuckerberg, Dorsey Tout Progress in Combating Political Misinformation.
• Demand for New Fences Meets a Nationwide Lumber Shortage.

Fox News: 

• Dominion Voting Systems and Smartmatic Designed for Vote Fraud. (video)
• Sidney Powell: A high-ranking military witness explaining how Smartmatic threw elections. (video)
  
• Pennsylvania governor issues new COVID rules, including wearing mask in your home.
  

CNBC.com:

• Shelton Fed nomination fails key Senate procedure vote, possibly ending her chances.
• Bill Gates says more than 50% of business travel will disappear in post-coronavirus world.
• The NFL will hold a virtual Pro Bowl this year, with players competing in the Madden video game.

MarketWatch.com:            

• Nio’s quarterly loss narrows, but stock falls.  
• Palantir stock rockets to record highs as hedge funds disclose stakes.  
• Opinion: Now that Tesla is joining the S&P 500, you might want to sell.

Zero Hedge:

• FEC Chair: If Sidney Powell Says There Was Rampant Voter Fraud, "I Believe Her".
• 'This Has Never Happened': Deadlocked Board In Largest Michigan County Refuses To Certify Nov 3 Vote.
• Second Memory Card With 2,755 Votes Found During Georgia Election Audit, Decreasing Biden Lead.
• Is There Really A China Economic Miracle?
• Trump Fires DHS Official Whose Agency Rebuffed Election Integrity Claims.
• SoftBank CEO Warns Of "Lehman-Like-Crisis" That Could Crash Global Economy.
• The "COVID Coup".
• Secretive Club For Ultra-Wealthy Environmentalists Revealed.
• Sen. Chuck Grassley Tests Positive, Tokyo Placed On Highest COVID-19 Alert Level: Live Update.
• Quant Carnage Hammers Iconic Hedge Funds Renaissance, Two Sigma.
• Robinhood Soliciting Advisors For Potential IPO Early Next Year.
• Weapons Of Mass Deception.
• Goldman Plans Second Round Of Layoffs Ahead Of "Significant Staff Reductions" In 2021.
• WTI Slides After Bigger Than Expected Crude Build.
• China De-Dollarization Accelerates: Treasury Holdings Near 4-Year Lows.
• Short-Squeeze Sparks Small-Cap Buying-Panic, Bitcoin Nears Record High.

Newsmax:

• Second Georgia County Finds Previously Uncounted Votes.
  

@kylenabecker:

• Epic Rant from @Jim_Jordan. (video)

Digital Blackboard:

• Daily New Cases by Region.

Worldometer:

• New Cases/Deaths by state.

Rt Covid-19:

• How fast virus is growing by state.

KFF:

• State Data(Tests/Hospitalizations).

Night Trading 

• Asian equity indices are -.5% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 60.25 +.25 basis point.

• China Sovereign CDS 33.0 +.5 basis point.

• Bloomberg Emerging Markets Currency Index 61.14 -.03%.
• Bloomberg Global Risk-On/Risk Off Index 1,130.0 +18.0 points.
• Volatility Index(VIX) futures 24.35 +1.35%
• FTSE 100 futures -.17%.

• S&P 500 futures -.15%.

• NASDAQ 100 futures -.19%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AVYA)/1.22
• (LOW)/1.95
• (TGT)/1.61
• (TJX)/.39
  

After the Close:

• (CPRT)/.70
• (JACK)/1.13
• (KLIC)/.31
• (LB)/.06
• (NVDA)/1.92
• (SCVL)/.68
• (SQM)/.22
• (ZTO)/1.49
  

Economic Releases

8:30 am EST

• Housing Starts for Oct. is estimated to rise to 1460K versus 1415K in Sept.
• Building Permits for Oct. is estimated to rise to 1568K versus 1553K in Sept.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +1,179,330 barrels versus a +4,277,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +62,000 barrels versus a -2,309,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,960,580 barrels versus a -5,355,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.64% versus a -.8% decline prior.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Australia Unemployment report, UK inflation data, Eurozone inflation data, weekly MBA Mortgage Applications report, Goldman Metals/Mining Conference and the (FFIV) investor meeting could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

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

Stocks Slightly Lower into Final Hour on Mounting US Election Fraud Evidence, Virus Fears, Global Growth Worries, Tech/Biotech Sector Weakness

 Broad Equity Market Tone:

• Advance/Decline Line: Around Even
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 22.4 -.22%
• Bloomberg Global Risk On/Risk Off Index 1,143.0 -36.0 points

• Euro/Yen Carry Return Index 128.0 -.27%

• Emerging Markets Currency Volatility(VXY) 10.55 unch.

• S&P 500 Implied Correlation 38.1 +2.1%

• ISE Sentiment Index 123.0 +2.0 points
  

• Total Put/Call .85 +18.1%

• NYSE Arms .67 -13.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 52.50 -.12%
  

• US Energy High-Yield OAS 725.60 -.18%

• European Financial Sector CDS Index 63.64 +1.15%

• Italian/German 10Y Yld Spread 120.0 unch.
  

• Asia Ex-Japan Investment Grade CDS Index 60.11 -.41%
  

• Emerging Market CDS Index 173.67 +2.57%
  

• iBoxx Offshore RMB China Corporate High Yield Index 181.54 +.02%

• 2-Year Swap Spread 8.75 unch.

• TED Spread 14.5 +.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -13.0 +2.25 basis points
  
• MBS  5/10 Treasury Spread  73.25 -.25 basis point
  
• IHS Markit CMBX BBB- 6 70.1 +.75 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.16 +.24%
• 3-Month T-Bill Yield .08% unch.

• Yield Curve 73.5 +2.5 basis points
  

• China Iron Ore Spot 122.99 USD/Metric Tonne +.66%

• Citi US Economic Surprise Index 67.9 +1.9 points

• Citi Eurozone Economic Surprise Index 102.4 +3.7 points
  

• Citi Emerging Markets Economic Surprise Index 59.3 -.6 point

• 10-Year TIPS Spread 1.72 -1.0 basis point
• 100.0% chance of no change at Jan. 27th meeting, 100.0% chance of no change at March 17th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +41 open in Japan 
• China A50 Futures: Indicating +34 open in China

• DAX Futures: Indicating +19 open in Germany

Portfolio:

• Slightly Lower: On losses in my biotech/medical sector longs
  

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges, then added them back
  

• Market Exposure: 50% Net Long

Bear Radar

Style Underperformer:

• Large-Cap Value -.4%

Sector Underperformers:

• 1) Gold & Silver -1.2% 2) Healthcare Providers -1.0% 3) Utilities -1.0%

Stocks Falling on Unusual Volume: 

• PFE, HD, PRDO, ABC, FSR, ARVN, FLGT, RVMD, DK, VERI, NARI, CYRX, DK, CYRX, JWS, CELH, VLO, SPT, CRNC, MCK, GMS, CAH, IRTC, ACMR, WBA, BSX, CVS, SLP, AQUA, JAMF, PLUG, CODX, RAD and GDRX
  

Stocks With Unusual Put Option Activity:

• 1) RIOT 2) FCEL 3) BLNK 4) BCLI 5) FUBO
  

Stocks With Most Negative News Mentions:

• 1) RAD 2) IRTC 3) CRNC 4) ADNT 5) GMS
  

Charts:

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