Thursday Watch

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 75.5 -1.25 basis points. 

• China Sovereign CDS 53.50 -.5 basis point.

• Bloomberg Emerging Markets Currency Index 67.85 +.02%.

• FTSE 100 futures +.09%.

• S&P 500 futures +.02%.

• NASDAQ 100 futures +.02%.

Morning Preview Links

Earnings of Note
Company/Estimate

Before the Open:

• (AZN)/1.48
• (AVP)/.07
• (BWA)/1.07
• (GOOS)/.81
• (CME)/1.73
• (KO)/.43
• (DUK)/.89
• (DGX)/1.37
• (R)/1.81
• (VMC)/.89
• (WLH)/1.06
• (YETI)/.34
• (ZTS)/.77

After the Close:

• (AMAT)/.79
• (ANET)/2.06
• (CBS)/1.53
• (CGNX)/.22
• (NVDA)/.75
• (XPO)/.82

Economic Releases
8:30 am EST

• PPI Final Demand MoM for January is estimated to rise +.1% versus a -.2% decline in Dec.
• PPI Ex Food and Energy MoM for January is estimated to rise +.2% versus a -.1% decline in Dec. 
• Initial Jobless Claims are estimated to fall to 225K versus 234K the prior week.
• Continuing Claims are estimated to rise to 1740K versus 1736K prior.
• Retail Sales Advance MoM for Dec. are estimated to rise +.1% versus a +.2% gain in Nov.
• Retail Sales Ex Auto and Gas for Dec. are estimated to rise +.4% versus a +.5% gain in Nov.

10:00 am EST

• Business Inventories for Nov. are estimated to rise +.2% versus a +.6% gain in Oct.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The China Trade Balance report, Eurozone GDP report, British Parliament vote on Brexit changes, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report, BB&T Logistics/Transports Conference, (IT) investor day, Keefe Bruyette Woods Financial Services Symposium and the (EMR) investor conference could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by energy and consumer shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed.  The Portfolio is 75% net long heading into the day.

Stocks Rising into Final Hour on China Trade Deal Hopes, Oil Gain, Technical Buying, Energy/Tech Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line

Equity Investor Angst:

• Volatility(VIX) 15.29 -.91%

• Euro/Yen Carry Return Index 129.99 -.06%

• Emerging Markets Currency Volatility(VXY) 8.85 +.57%

• S&P 500 Implied Correlation 41.57 +.63%

• ISE Sentiment Index 69.0 -39.5%
  

• Total Put/Call 1.0 +29.9%

• NYSE Arms 1.14 +32.6%

Credit Investor Angst:

• North American Investment Grade CDS Index 64.34 -1.63%
  

• America Energy Sector High-Yield CDS Index 555.0 -1.79%

• European Financial Sector CDS Index 88.30 -1.76%

• Italian/German 10Y Yld Spread 266.0 -5.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 75.86 -3.71%
  

• Emerging Market CDS Index 176.55 +1.02%
  

• iBoxx Offshore RMB China Corporate High Yield Index 156.91 +.13%

• 2-Year Swap Spread 13.25 -.25 basis point

• TED Spread 27.25 -.75 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -8.75 -.25 basis point.

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 67.85 -.56%
• 3-Month T-Bill Yield 2.42% +1.0 basis point

• Yield Curve 17.25 -.5 basis point

• China Iron Ore Spot 84.80 USD/Metric Tonne +1.11%

• Citi US Economic Surprise Index 15.40 +.2 point

• Citi Eurozone Economic Surprise Index -79.0 -1.4 points

• Citi Emerging Markets Economic Surprise Index -11.8 -3.9 points

• 10-Year TIPS Spread 1.86 +2.0 basis points
• 1.8% chance of Fed rate hike at May 1st meeting, 4.7% chance at June 19th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +31 open in Japan 
• China A50 Futures: Indicating +14 open in China

• DAX Futures: Indicating +30 open in Germany

Portfolio:

• Higher: On gains in my tech/biotech/retail/industrial sector longs

• Disclosed Trades: None

• Market Exposure: 100% Net Long

Morning Market Internals

NYSE Composite Index:

• Volume Running +12.6% Above 100-Day Average
• 10 Sectors Rising, 1 Sector Declining
• 64.0% of Issues Advancing, 32.8% Declining
• 61 New 52-Week Highs, 4 New Lows
• 43.6% of Issues Above 200-day Moving Average
• Average 14-Day RSI 57.4%
• Vix 15.7 +1.8%
• Total Put/Call .91 +18.2%
• TRIN/Arms .83 -3.5%

Wednesday Watch

Night Trading 

• Asian equity indices are +.25% to +1.0% on average.

• Asia Ex-Japan Investment Grade CDS Index 76.75 -3.0 basis points. 

• China Sovereign CDS 54.0 -2.25 basis points.

• Bloomberg Emerging Markets Currency Index 68.30 +.09%.

• FTSE 100 futures +.41%.

• S&P 500 futures +.32%.

• NASDAQ 100 futures +.39%.

Morning Preview Links

Earnings of Note
Company/Estimate
Before the Open:

• (AB)/.64

• (DISH)/.69

• (FLIR)/.59

• (GPN)/1.32

• (HLT)/.69

• (LPX)/.26

• (WH)/.58

After the Close:

• (CF)/.50

• (CSCO)/.72

• (FOSL)/1.21

• (HCP)/.43

• (MRO)/.14

• (MGM)/.14

• (NTAP)/1.15

• (OII)/-.26

• (PPC)/.15

• (SPWR)/-.34

• (TLRY)/-.14

• (TRUP)/.03

• (WMB)/.24

• (YELP)/.36

Economic Releases
8:30 am EST

• The CPI MoM for January is estimated to rise +.1% versus a -.1% decline in Dec.

• The CPI Ex Food and Energy MoM for January is estimated to rise +.2% versus a +.2% gain in Dec.

• Real Avg. Weekly Earnings YoY for January.

10:30 am EST

• Bloomberg consensus estimates call for a weekly crude oil inventory gain of +1,949,670 barrels versus a +1,263,000 barrel gain the prior week. Gasoline supplies are estimated to rise by +794,220 barrels versus a +513,000 barrel gain the prior week. Distillate inventories are estimated to fall by -1,659,110 barrels versus a -2,257,000 barrel decline prior. Finally, Refinery Utilization is estimated to fall by -.52% versus a +.6% gain the prior week.
  

2:00 pm EST

• The Monthly Budget Deficit for Dec. is estimated at -$11.0B versus -$204.9B in Nov.
  

Upcoming Splits

• None of note

Other Potential Market Movers

• The UK inflation data report, Eurozone Industrial Production report, weekly MBA Mortgage Applications report and the BofA Merrill Insurance Conference could also impact trading today.

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