Friday Watch

Evening Headlines

Bloomberg:                   

• Didi Joins China’s Worst U.S. IPOs After New Regulatory Pressure.
• Hedge Funds Rush to Profit Off China’s Commodity Price Battle.
• China Crypto Miners Plot Their Next Moves to Evade Crackdown.
• Italy Requires Vaccine Pass for Dining and Leisure as Cases Rise.  
• South America’s Left Turn Is Bullish Copper, Top Miner Says.
  
• Asia Stocks Steady After U.S. Shares Neared Record: Markets Wrap.  
• Oil Holds Three-Day Advance on Outlook for Tighter Global Market.
• Senate Infrastructure Deal in Sight After Medicare Agreement.  
• JPMorgan to Double Advisers as Wall Street Vies for Wealthy.  
• Hard Seltzer Craze Starting to Fade, Says Sam Adams Maker.  
• Biden on CNN Gets Smaller Audience Than Normal Night at Fox News.  
• Carlyle Pushes for Industry’s Largest Buyout Fund at $27 Billion.

Wall Street Journal:

• How Much More Will Your Oreos Cost? Companies Test Price Increases.
• Intel CEO Says Chip Shortage Could Stretch Into 2023. 
• Thousands of Afghan Interpreters Bound for U.S. Bases in Kuwait, Qatar.
• A Tale of Two Recoveries.
• U.S. Median Home Price Hits New High.
• Federal Reserve Ramps Up Debate on Taper Timing, Pace.
• U.S. Vaccine Panel Signals Support for Covid-19 Booster Shots.
• Amazon-Backed Rivian Automotive Plans Second U.S. Electric-Vehicle Factory.
• Startup Claims Breakthrough in Long-Duration Batteries.
• Bitcoin Is Failing Its First Inflation Test.

Fox News:

• Ex-education secretary reveals why Biden admin's 'error' excuse for pushing CRT group is 'falsehood'.
  

CNBC.com:

• Stocks making the biggest moves after hours: Twitter, Snap, Intel and more.
• Here’s what’s next for the bipartisan infrastructure plan after setback in the Senate.
• Jim Cramer says near-term Covid delta variant concerns won’t threaten long-term stock market gains.
  

MarketWatch.com:          

• Another 2.2 million stimulus checks just went out — and it’s a great reminder to file your taxes.
  
• Snap crushes earnings expectations as revenue more than doubles.
  
• Why coffee futures scored their biggest 1-day gain in over 7 years.

Zero Hedge:

• Why Are Thieves Stealing So Many Catalytic Converters?
• Have We Reached "Peak Self-Glorifying Billionaire"?
• Global Home Prices Are Rising At The Fastest Pace On Record. 
• Montana Attorney General Provides Legal Basis For Rejecting Critical Race Theory: Activists.
• UK's Sending 2 Warships To Japan Infuriates China - Warns Against "Flexing Muscles".
• Secessionist, Border Realignment Movements Gaining Traction In US.
• Albert Edwards Notices "Something Shocking" In The "Transitory vs Persistent Inflation" Debate.
• NFL Teams With Unvax'd Players To Forfeit Games, Incur Financial Liability During Outbreaks.
• Twitter Shares Soar AFter Hours After Top-Line Beat & Raise.
• Small Caps Slammed As 'Short Squeeze' Ammo Dries Up, Bonds & Bitcoin Bid.

Newsmax:

• Trump: Arizona 'RINO' Is Holding Up Forensic Audit of 2020 Ballots.  
• Rep. Hice: Pelosi 'Comfortable' With Republicans Off Committee.
  

TheGatewayPundit.com:

• ‘It May Be You Have to Pay More Wages’ – Psaki Tells Small Business Owners Struggling to Find Workers to Compete with the Government (VIDEO).
• CNN’s Dumpster Fire Town Hall with Joe Biden Finishes Dead Last with Viewers… But He Totally Got 81 Million VotesChina Refuses To Work With W.H.O. On Second Phase Investigation Of Lab Leak Theory.
• CDC Quietly Deletes 6,000 COVID Vaccine Deaths From Its CDC Website Total in One Day — Caught by Internet Sleuths (VIDEO).
• As Crime Skyrocketed Across the Nation, George Soros Gave $1 Million to an Organization Working to Defund the Police.
• Why Did Georgia Mail Out 7 Million Absentee Ballots in 2020 Election When that Was the Number of Registered Voters in the State?

The Epoch Times:

• 81 Percent of Americans Are Concerned About Chinese Influence in US: Poll.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
  
• NYTimes.com:  County Trends and Clusters.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity.
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading 

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

• Asia Ex-Japan Investment Grade CDS Index 85.75 +.25 basis point.

• China Sovereign CDS 38.25 unch.
  

• Bloomberg Emerging Markets Currency Index 59.84 +.01%.
• Bloomberg Global Risk-On/Risk Off Index 2,827.0 +2.0 points.
• Volatility Index(VIX) futures 20.20 -1.8%.
• FTSE 100 futures +.39%.

• S&P 500 futures +.31%.

• NASDAQ 100 futures +.42%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AXP)/1.62
• (GNTX)/.44
• (HON)/1.95
• (KMB)/1.71
• (RF)/.53
• (SLB)/.26
  

After the Close:

• None of note
  

Economic Releases

9:45 am EST

• Markit US Manufacturing PMI for July is estimated to fall to 62.0 versus 62.1 in June.
• Markit US Services PMI for July is estimated to fall to 64.5 versus 64.6 in June.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone PMI report could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are modestly higher, boosted by technology and consumer 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 Earnings Optimism, Lower Long-Term Rates, Oil Gain, Restaurant/Road & Rail Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Below Average

• Market Leading Stocks: Performing In line
  

Equity Investor Angst:

• Volatility(VIX) 17.6 -1.7%
• Bloomberg Global Risk On/Risk Off Index 2,832.0 +2.0 points

• Euro/Yen Carry Return Index 133.94 -.31%

• Emerging Markets Currency Volatility(VXY) 8.8 -.11%

• S&P 500 Implied Correlation 51.4 -1.3%

• ISE Sentiment Index 112.0  +2.0 point
  

• Total Put/Call .81 -4.7%

• NYSE Arms 1.33 +155.7%

Credit Investor Angst:

• North American Investment Grade CDS Index 48.98 -.43%
  

• US Energy High-Yield OAS 421.73 -.4%

• European Financial Sector CDS Index 54.33 -2.1%

• Italian/German 10Y Yld Spread 108.0 -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 85.87 -.65%
  

• Emerging Market CDS Index 162.47 +.46%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 38.80 -.13%

• 2-Year Swap Spread 8.25 -.25 basis point

• TED Spread 9.5 +.5 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -5.0 -1.0 basis point
  
• MBS  5/10 Treasury Spread  73.25 unch.
  
• IHS Markit CMBX BBB- 6 73.5 -.25 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 59.82 +.03%
• 3-Month T-Bill Yield .04% -1.0 basis point
  

• Yield Curve 101.0 unch.
  

• China Iron Ore Spot 198.0 USD/Metric Tonne -.7%

• Citi US Economic Surprise Index 11.6 -.5 point

• Citi Eurozone Economic Surprise Index 59.6 -.7 point
  

• Citi Emerging Markets Economic Surprise Index 54.5 -4.0 points

• 10-Year TIPS Spread 2.31 +1.0 basis point
• 100.0% chance of no change at Nov. 3rd meeting, 100.0% chance of no change at Dec. 15th meeting

US Covid-19:

• 85 infections/100K people(last 7 days) +6/100K people
• 16% of Jan. 7th, 2021 peak(highest daily avg. new infections) +1.0 percentage point
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +492 open in Japan 
• China A50 Futures: Indicating -46 open in China

• DAX Futures: Indicating +21 open in Germany

Portfolio:

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

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Bear Radar

 Style Underperformer:

• Small-Cap Value -1.4%

Sector Underperformers:

• 1) Alt Energy -2.2% 2) Oil Service -1.5% 3) Gaming -1.3%

Stocks Falling on Unusual Volume: 

• LRN, SON, LVS, CCI, AGIO, TXN, OLMA, KDNY, GO and NTGR
  

Stocks With Unusual Put Option Activity:

• 1) AKAM 2) DPZ 3) CEMI 4) CROX 5) SPRT
  

Stocks With Most Negative News Mentions:

• 1) NTGR 2) TCON 3) LVS 4) AMC 5) PBF
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.6%

Sector Outperformers:

• 1) Restaurants +2.4% 2) Road & Rail +1.7% 3) Software +1.2%

Stocks Rising on Unusual Volume:

• NRXP, AGFY, DPZ, AFIB, ARVN, CROX, SAVA, PZZA, QDEL, ALEX, PLXP, BMBL, VERI, APR, FE, MGI, BX, EWBC, CSX, WING, BTU, BCRX, ASAN, XM, APP, CANO, AVPT, TPH, NSA and GHVI
  

Stocks With Unusual Call Option Activity:

• 1) IGC 2) FE 3) CROX 4) WHR 5) BYD

Stocks With Most Positive News Mentions:

• 1) DPZ 2) SGMA 3) TPH 4) CROX 5) CSX
  

Charts:

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

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running -21.8% Below 100-Day Average 
• 6 Sectors Rising, 5 Sectors Declining
• 29.8% of Issues Advancing, 66.4% Declining
• 63 New 52-Week Highs, 18 New Lows
• 77.4% of Issues Above 200-day Moving Average
• Average 14-Day RSI 46.2%
  
• Bloomberg Global Risk-On/Risk-Off Index 2,800.0 -29.0 points
• Russell 1000: Growth/Value 17,704 +.87%
  
• Vix 17.8 -.4%
• Total Put/Call .81 -4.7%
• TRIN/Arms 1.36 +162.0%

Thursday Watch

Evening Headlines

Bloomberg:                   

• U.S. Envoy Wendy Sherman to Visit China as Tensions Build.
  
• China’s Latest Easing Sparks a Shift Through Its Debt Markets.  
• U.S.-China Goods Trade Booms as If Virus, Tariffs Never Happened.
• Covid May Have Claimed as Many as 5 Million Lives in India.  
• ECB to Move Stimulus Path for New Inflation Goal: Decision Guide.
• Asian Stocks Advance After Earnings-Led U.S. Climb: Markets Wrap.
• Crude Oil Trades Above $70 a Barrel Following Two-Day Rebound.
• Biden Dismisses Inflation Concerns But Not Hiring Difficulties.
• Powell Has Broad Support Among Top Biden Aides for New Fed Term.
• Debt-Limit Steps May Run Out in October, Budget Office Says.  
• Lumber Rises as Canada Wildfires Snarl Production, Shipments.  
• Single-Family Rents Climbed at 6.6% Pace in May, CoreLogic Says.

Wall Street Journal:

• Car Dealers Can Keep Rolling After Supply Crunch.
• Tough Biden Talk, Little Action.
• Watch: How TikTok’s Algorithm Figures Out Your Deepest Desires.
• FTC Wants to Make It Easier to Fix Devices.
• Starter-Home Shortage Extends Beyond Major Cities

Fox News: 

• White House meeting with CDC to discuss making major change to mask guidance as COVID "surges".
• Biden questions whether parents will be honest about their kids being vaccinated.
• Police point to bigger problem as latest shoplifting video emerges, crime soars.
  

CNBC.com:

• Local officials across U.S. are starting to reimpose Covid mask rules as delta variant takes hold.
• The bond market is torn over the potential for higher inflation and lower growth.
• Jim Cramer predicts S&P 500 ‘is done getting slammed,’ sees upside ahead.
  

MarketWatch.com:          

• Think this is a ‘weird market’ right now? Here’s more proof.
  
• Takeout and dining out has never been so popular – how U.S. restaurants survived and now thrive.

Zero Hedge:

• Democrat Who Featured In Infamous 'Maskless Flight' Pic Calls For "Universal Mask-Wearing".
• Rockets Target Kabul Presidential Palace As US Afghan Draw Down Enters Final Days.
• National Park Service To Send Data Collected From Special Use Permits To White House.
• Saudi Aramco Targeted In $50M Crypto Extortion Scheme After Major Data Breach.
• Paying Your "Fair Share" Of The Warfare-Welfare State.
• Watch: Capitol Defendant's Attorney Says Detainees Are Being Subject To "Torture!" In Contentious CNN Interview.
• Whitmer Kidnapping Defendants Claim Entrapment After 12 FBI Informants Involved In Plot.
• American Life Expectancy Sees Biggest Drop Since WWII, Erasing 20 Years Of Progress.
• The Fallacy Of Climate Financial Risk.
• Senate Republicans Vote To Block Opening Debate On $1.2 Trillion Bipartisan Infrastructure Deal.
• Musk Sparks Major Crypto Spike, Stock Short-Squeeze Continues.

Newsmax:

• Texas Lawmaker Seeks Audit of Ballots in 13 Largest Counties.  
• Rep. Babin: Biden, Dems 'Shirking Constitutional Duty' at Border.
• Rep. Donalds: Fauci 'Lost His Credibility'.
  

TheGatewayPundit.com:

• Mike Lindell Offers $5 Million Reward to Any Cyber Expert Who Can Prove His Voter Fraud Data Invalid.
• Biden Homeland Security Announces Travel Restrictions for Americans at Border Due to COVID Variant But Southern Border Will Remain Open to Illegals.
• Sen. Ron Johnson: Data from Israel Shows 84% of New COVID Cases are with Vaccinated Individuals (VIDEO).
• House Democrats Block Bill to Declassify Intel on Origins of COVID-19 Virus in Wuhan Lab.
• VIDEO: US Women’s Soccer Team Took Knee During Anthem Before Getting Spanked by Swedish Team 3-0 in Olympic Opening.
• He’s Culpable. He’s Lying About It. And He Needs to Be Held Accountable” – Sen. Ron Johnson Says It’s Time to Go After Fauci for Funding Gain-of-Function Research, Lying About It Under Oath (VIDEO).

The Epoch Times:   

• Public Health Experts Tell House GOP Forum CCP Virus ‘Likely Originated’ in Wuhan Lab Leak.

Covid-19(Data, Maps, Graphs):

• Our World in Data:  New Global Covid-19 Cases(7-day rolling average graphs). New Covid Hospital Admissions/ICU Admissions/Deaths
  
• FT.com:  Fully Vaccinated by Country(graph). Global Lockdown Stringency Index(map).
  
• NYTimes.com:  County Trends and Clusters.
  
• Brown School of Public Health:  Covid Severity by State/County(map).  US Hospital Capacity.
  
• CovidActNow:  Covid Severity/Infection Rate by Metro Area.
  
• KFF:  US Vaccinations by Race/Ethnicity.
  
• Carnegie Mellon: Covid-Like Symptoms in Community. Covid Symptom Searches on Google. Covid-Related Dr.Visits.  Restaurant Visits. Wearing Masks. (graphs)
  
• Safegraph.com:  Commerce Patterns(graphs).

Night Trading 

• Asian equity indices are +.25% to +1.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 85.5 -.5 basis point.

• China Sovereign CDS 38.25 +.25 basis point.
  

• Bloomberg Emerging Markets Currency Index 59.92 +.02%.
• Bloomberg Global Risk-On/Risk Off Index 2,854.0 +24.0 points.
• Volatility Index(VIX) futures 20.10 -.04%.
• FTSE 100 futures +.19%.

• S&P 500 futures +.11%.

• NASDAQ 100 futures +.16%. 

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (ABB)/.40
• (ABT)/1.02
• (ALK)/-.45
• (AAL)/-1.72
• (T)/.79
• (BIIB)/4.60
• (BX)/.77
• (CLF)/1.51
• (DHI)/2.81
• (DHR)/2.05
• (DPZ)/2.88
• (DOW)/2.35
• (FITB)/.81
• (FCX)/.75
• (GPC)/1.54
• (NEM)/.77
• (NUE)/4.78
• (POOL)/5.48
• (DGX)/2.85
• (RS)/4.89
• (SGMS)/.08
• (SNA)/3.24
• (LUV)/-.26
• (UNP)/2.54
  

After the Close:

• (OZK)/.92
• (SAM)/6.91
• (COF)/4.51
• (CSL)/2.22
• (FE)/.56
• (INTC)/1.07
• (RHI)/1.04
• (SNAP)/-.01
• (TWTR)/.07
• (VRSN)/1.37
  

Economic Releases

8:30 am EST

• The Chicago Fed National Activity Index for June is estimated to rise to .3 versus .29 in May.
• Initial Jobless Claims for last week are estimated to fall to 350K versus 360K the prior week. 
• Continuing Claims are estimated to fall to 3100K versus 3241K prior.
  

10:00 am EST

• The Leading Index for June is estimated to rise +.9% versus a +1.3% gain in May.
• Existing Home Sales for June is estimated to rise to 5.9M versus 5.8M in May.

11:00 am EST

• Kansas City Fed Manufacturing Activity for July is estimated to fall to 25.0 versus 27.0 in June.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The ECB meeting, Eurozone IFO Guidance, weekly Langer Consumer Comfort Index, weekly EIA natural gas inventory report and the (SCHW) business update could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

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.