Morning Market Internals

NYSE Composite Index:

• Volume Running -9.4% Above 100-Day Average
• 9 Sectors Rising, 2 Sectors Declining
• 60.9% of Issues Advancing, 35.3% Declining
• 135 New 52-Week Highs, 20 New Lows
• 53.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.8%
• Vix 15.6 -4.2%
• Total Put/Call .89 +8.5%
• TRIN/Arms 1.27 +95.9%

Friday Watch

Night Trading 

• Asian equity indices are +.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 58.75 -1.75 basis points.

• China Sovereign CDS 40.75 -3.0 basis points.

• Bloomberg Emerging Markets Currency Index  65.56 +.01%.
• FTSE 100 futures +.01%.

• S&P 500 futures +.30%.

• NASDAQ 100 futures +.30%.

Morning Preview Links 

Earnings of Note 

Company/Estimate

Before the Open:

• (GCO)/-.01

After the Close:

• None of note

Economic Releases

8:30 am EST

• The Change in Non-Farm Payrolls for Aug. is estimated at 160K versus 164K in July.
• The Unemployment Rate for Aug. is estimated at 3.7% versus 3.7% in July. 
• Average Hourly Earnings MoM for August is estimated to rise +.3% versus a +.3% gain in July.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Powell speaking, Eurozone GDP report and the Eurozone Industrial Production report could also impact trading today.

BOTTOM LINE: Asian indices are 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 100% net long heading into the day.

Stocks Surging into Afternoon on China Trade Deal Hopes, Diminished Global Growth Fears, Less European/Emerging Markets/US High-Yield Debt Angst, Transport/Retail Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Outperforming

Equity Investor Angst:

• Volatility(VIX) 15.99 -7.7%

• Euro/Yen Carry Return Index 122.58 +.53%

• Emerging Markets Currency Volatility(VXY) 8.5 -1.05%

• S&P 500 Implied Correlation 39.5 -6.5%

• ISE Sentiment Index 80.0 -10.1%
  

• Total Put/Call .81 -16.5%

• NYSE Arms .77 +35.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 52.28 -3.56%
  

• America Energy Sector High-Yield CDS Index 423.0 -2.56%

• European Financial Sector CDS Index 58.70 -3.64%

• Italian/German 10Y Yld Spread 153.75 +5.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 59.46 -4.78%
  

• Emerging Market CDS Index 200.04 -1.50%
  

• iBoxx Offshore RMB China Corporate High Yield Index 165.14 -.05%

• 2-Year Swap Spread -2.0 -1.25 basis points

• TED Spread 16.50 -.5 basis point

• 3-Month EUR/USD Cross-Currency Basis Swap -16.5 -1.0 basis point

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 65.61 +.11%
• 3-Month T-Bill Yield 1.96% +2.0 basis points

• Yield Curve .03 +2.0 basis points

• China Iron Ore Spot 87.33 USD/Metric Tonne +.41%

• Citi US Economic Surprise Index 7.7 +15.4 points

• Citi Eurozone Economic Surprise Index -34.30 -2.5 points

• Citi Emerging Markets Economic Surprise Index -14.6 -1.1 points

• 10-Year TIPS Spread 1.55+4.0 basis points
• 100.0% chance of Fed rate cut at Oct. 30th meeting, 100.0% chance of cut at Dec. 11th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +95 open in Japan 
• China A50 Futures: Indicating +100 open in China

• DAX Futures: Indicating -6 open in Germany

Portfolio:

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

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 100% Net Long

Bear Radar

Style Underperformer:

• Mid-Cap Value +1.1%

Sector Underperformers:

• 1) Gold & Silver -4.5% 2) Utilities -1.2% 3) REITs -.8%

Stocks Falling on Unusual Volume: 

• MDP, GMS, NNN, VRNT, BGNE, USLV, CDAY, CIEN, ATRC, MTCH, CHD, MDB, SMAR, QURE, MMSI, APPN, INOV, SA, AG, ROKU, ZS, UPWK, IAC and BTU

Stocks With Unusual Put Option Activity:

• 1) CIEN 2) FXE 3) DOCU 4) RTN 5) SLV

Stocks With Most Negative News Mentions:

• 1) MNK 2) MDP 3) BTU 4) REVG 5) ABX

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +2.1%

Sector Outperformers:

• 1) Retail +3.7% 2) Oil Service +3.6% 3) Semis +3.1%

Stocks Rising on Unusual Volume:

• DSLV, SIG, ADUS, IGV, INMD, GIII, PANW, APO, GBT, DGLD, BILI, IJT, NOBL, AVAV, ECPG, ULTA, VTWO, DCI, AAXJ, FLY, NDSN, DSGX, CPRT, TLRY, RYAAY, CRC, AEO, LCI, PSN, NAV, INMD, GNRC, NVDA, PII, MBUU, XENT, CG, HTLD, STAY, OLED, MXL, ADVM, ECPG, YEXT, SAIA and RARE

Stocks With Unusual Call Option Activity:

• 1) ASHR 2) XEC 3) ATUS 4) ZGNX 5)CIEN

Stocks With Most Positive News Mentions:

• 1) CLDR 2) LE 3) LULU 4) INTC 5) SCHW

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +34.4% Above 100-Day Average
• 8 Sectors Rising, 3 Sector Declining
• 70.2% of Issues Advancing, 27.5% Declining
• 198 New 52-Week Highs, 11 New Lows
• 49.5% of Issues Above 200-day Moving Average
• Average 14-Day RSI 47.8%
• Vix 15.9 -8.3%
• Total Put/Call .80 -17.5%
• TRIN/Arms .88 +54.4%