Stocks Rising into Final Hour on US Economic Data, Earnings Outlook Optimism, Stable Long-Term Rates, Tech/Gambling Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Around Even
  

• Sector Performance: Mixed
  

• Volume: Above Average
  

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.6 +.9%
• DJIA Intraday % Swing .70 unch.
  
• Bloomberg Global Risk On/Risk Off Index 64.5 +3.0%

• Euro/Yen Carry Return Index 174.5 -.9%

• Emerging Markets Currency Volatility(VXY) 8.9 +2.1%

• CBOE S&P 500 Implied Correlation Index 12.3 +1.7% 

• ISE Sentiment Index 195.0 +22.0 points
  

• Total Put/Call .81 -8.0%

• NYSE Arms 1.40 -18.5%
  
• NYSE Non-Block Money Flow -$110.4M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 47.5 -.2%
  

• US Energy High-Yield OAS 288.7 -.3%
• Bloomberg TRACE # Distressed Bonds Traded 175 -13
  

• European Financial Sector CDS Index 63.5 +1.1%
  
• Deutsche Bank Subordinated 5Y Credit Default Swap 161.7 +.7%
  

• Italian/German 10Y Yld Spread 123.0 basis points +3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 72.8 -.7%
  

• Emerging Market CDS Index 156.3 -.14%
• Israel Sovereign CDS 108.7 -1.1%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.8 +.05%

• 2-Year SOFR Swap Spread -17.5 basis points -3.5 basis points
  

• 3M T-Bill Treasury Repo Spread -9.0 basis points -2.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -3.75 -1.0 basis point
  
• MBS  5/10 Treasury Spread 136.0 -2.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 646.0 unch.
  
• Avg. Auto ABS OAS 45.0 -2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 37.3 -.3%
• 3-Month T-Bill Yield 4.49% -1.0 basis point
  

• China Iron Ore Spot 105.0 USD/Metric Tonne +.3%
• Dutch TTF Nat Gas(European benchmark) 48.7 euros/megawatt-hour +1.8%

• Citi US Economic Surprise Index 34.3 +4.3 points
  

• Citi Eurozone Economic Surprise Index -24.3 -2.5 points

• Citi Emerging Markets Economic Surprise Index .3 -1.0 point
• S&P 500 Current Quarter EPS Growth Rate YoY(485 of 500 reporting) +8.2% unch.
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 270.22 +.26:  Growth Rate +13.3% +.1 percentage point, P/E 22.4 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.59% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(9 of 10 reporting) +33.3% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 383.37 +1.36: Growth Rate +22.4% +1.0 percentage point, P/E 32.8 +.1 point
  
• Bloomberg US Financial Conditions Index .83 +2.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index 1.04 -24.0 basis points
  
• US Yield Curve -.5 basis point (2s/10s) -1.0 basis point
  
• US Atlanta Fed Q4 GDPNow Forecast +3.16% +58.0 basis points
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 34.7% -.6 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.94% +18.0 basis points: CPI YoY +2.70% unch.
  
• 10-Year TIPS Spread 2.27 +1.0 basis point
  
• Highest target rate probability for Jan. 29th FOMC meeting: 57.7%(-.1 percentage point) chance of 4.25%-4.5%. Highest target rate probability for March 19th meeting: 42.9%(+3.3 percentage points) chance of 4.25%-4.5%. (current target rate is 4.5-4.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +177 open in Japan 
• China A50 Futures: Indicating +3 open in China

• DAX Futures: Indicating +51 open in Germany

Portfolio:

• Slightly Higher:  On gains in my tech/consumer discretionary sector longs
  

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

• Market Exposure: Moved to 100% Net Long
  

Bear Radar

Style Underperformer:

• Large-Cap Value -.4%
  

Sector Underperformers:

• 1) Gold & Silver -1.8% 2) Utilities -1.6% 3) REITs -1.5%

Stocks Falling on Unusual Volume: 

• RDW, TCMD, ZIM, PCG, DAVE, BGNE, LC, ANAB, NU, TREE, LB, STLA, LSPD, NPWR, ACMR, RVMD, ETON, BKKT, RCAT, JANX, RKLB, CORZ, MARA, IONQ and UPST
  

Stocks With Unusual Put Option Activity:

• 1) EWC 2) VRSN 3) ZS 4) PCG 5) OKTA
  

Stocks With Most Negative News Mentions:

• 1) UPST 2) TOST 3) LC 4) ACHR 5) APLT
  

Sector ETFs With Most Negative Money Flow:

• 1) SMH 2) FDN 3) XLV 4) IBB 5) VGT

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Growth +.9%
  

Sector Outperformers:

• 1) Computer Hardware +5.0% 2) Semis +2.6% 3) Gambling +1.2%

Stocks Rising on Unusual Volume:

• NVCR, SMCI, ARQQ, PTCT, NBIS, DAN, ZETA, WOLF, NEP, JKS, MNSO, PLRX, VSCO, DOYU, MRUS, ENVX, GRAL, ROKU, YY, CRSP, GPRK, GAP, NET, BBAR, LOMA, ANF, LIF, AEO, SMLR, FIVE, SQ, TSM, IGT, NCLH, OSCR, PYCR, DKS, LULU, PYCR, BAP, LIND, URBN, OKTRA, AKAM, CNK, AMPL, PRMB, MRVL, BAP, BURL, FSLR, FMS, TTD, RRR, PUBM, ASML, PVH, TPR, BLBD, PUBM and PCT
  

Stocks With Unusual Call Option Activity:

• 1) CHAU 2) PL 3) OPTT 4) WIX 5) KULR

Stocks With Most Positive News Mentions:

• 1) NVCR 2) MNSO 3) ROKU 4) NET 5) NCLH
  

Sector ETFs With Most Positive Money Flow:

• 1) XLF 2) XBI 3) PKB 4) PSI 5) XLU
  

Charts:

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

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open:

• (CNM)/.65
• (DCI)/.82
  

After the Close: 

• (BOX)/.42
• (MRVL)/.41
• (OKTA)/.58
• (CRM)/2.44
  

Economic Releases

10:00 am EST

• The JOLTS Job Openings for Oct. is estimated to rise to 7519K versus 7443K in Sept.
  

Afternoon

• Wards Total Vehicle sales for Nov. is estimated to rise to 16.1M versus 16.04M in Oct.
  

Upcoming Splits

• (ANET) 4-for-1
  

Other Potential Market Movers

• The Fed's Kuglar speaking, weekly US retail sales reports, (HOOD) investor day, (T) investor day, UBS TMT Conference, UBS Tech/AI Conference, Piper Sandler Healthcare Conference, Citi Healthcare Conference, UBS Industrials/Transports Conference, Barclays Eat/Sleep/Play/Shop Conference, Citi Basic Materials Conference, Goldman Sachs Industrials Conference, Morgan Stanley Consumer/Retail Conference Fireside Chat and the Wells Fargo TMT Conference could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +23.3% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 12.0 -.4
  
• 3 Sectors Declining, 8 Sectors Rising
• 43.7% of Issues Advancing, 54.0% Declining 
• TRIN/Arms 1.34 -19.8%
  
• Non-Block Money Flow -$82.6M
  
• 98 New 52-Week Highs, 31 New Lows
• 63.6% (+.1%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 65.0 -3.0
  

Other:

• Bloomberg Global Risk-On/Risk-Off Index 64.8 +3.5%
• Bloomberg Cyclicals/Defensives Index 245.3 +1.0%
  
• Russell 1000: Growth/Value 20,257.3 +1.6%
• CNN Fear & Greed Index 67.0 (GREED) +1.0
  
• 1-Day Vix 6.5 -24.9%
  
• Vix 13.5 -.4%
  
• Total Put/Call .80 -9.1%

Monday Watch

Night Trading

• Asian indices are -.25% to +.75% on average.
• Asia Ex-Japan Investment Grade CDS Index 72.75 -.5 basis point.
  
• China Sovereign CDS 64.5 -.25 basis point.
• China Iron Ore Spot 104.3 USD/Metric Tonne +.2%.
  
• Bloomberg Emerging Markets Currency Index 37.4 -.1%.
• Bloomberg Global Risk-On/Risk Off Index 65.3 +4.3%.
• Volatility Index(VIX) futures 16.0 -.2%. 
• Euro Stoxx 50 futures -.56%.
• S&P 500 futures -.12%.
• NASDAQ 100 futures -.19%.

Morning Preview Links

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