Stocks Rising into Afternoon on Economic Data, Earnings Optimism, Oil Gain, Financial/Consumer Discretionary Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 17.6 +1.8%
• Bloomberg Global Risk On/Risk Off Index 3,322.0 +105.0 points

• Euro/Yen Carry Return Index 136.53 +.21%

• Emerging Markets Currency Volatility(VXY) 9.6 -.1%

• S&P 500 Implied Correlation 49.4 +2.5%

• ISE Sentiment Index 98.0 -39.0 points
  

• Total Put/Call .72 -11.1%

• NYSE Arms 1.17 +41.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 50.39 -1.1%
  

• US Energy High-Yield OAS 438.88 -1.24%

• European Financial Sector CDS Index 58.50 -1.36%

• Italian/German 10Y Yld Spread 111.0 unch.
  

• Asia Ex-Japan Investment Grade CDS Index 80.67 -1.35%
  

• Emerging Market CDS Index 166.24 -.38%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 39.30 -.17%

• 2-Year Swap Spread 11.75 unch.

• TED Spread 17.25 -.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -3.0 -.25 basis point
  
• MBS  5/10 Treasury Spread  62.75 -1.5 basis points
  
• IHS Markit CMBX BBB- 6 71.5 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.12 -.18%
• 3-Month T-Bill Yield .01% unch.
  

• Yield Curve 145.0 unch.
  

• China Iron Ore Spot 186.30 USD/Metric Tonne -.3%

• Citi US Economic Surprise Index 38.90 -4.4 points

• Citi Eurozone Economic Surprise Index 159.2 +37.3 points
  

• Citi Emerging Markets Economic Surprise Index 43.2 -.1 point

• 10-Year TIPS Spread 2.43 +1.0 basis point
• 88.0% chance of no change at Sept. 22nd meeting, 86.1% chance of no change at Nov. 3rd meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -44 open in Japan 
• China A50 Futures: Indicating -94 open in China

• DAX Futures: Indicating +15 open in Germany

Portfolio:

• Slightly Higher: On gains in my industrial/energy/tech sector longs sector longs
  

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Morning Market Internals

NYSE Composite Index:

• Volume Running -3.7% Below 100-Day Average 
• 9 Sectors Rising, 2 Sectors Declining
• 49.3% of Issues Advancing, 46.5% Declining
• 385 New 52-Week Highs, 9 New Lows
• 88.2% of Issues Above 200-day Moving Average
• Average 14-Day RSI 54.1%
  
• Bloomberg Global Risk-On/Risk-Off Index 3,298.0 +84.0 points
• Vix 17.6 +1.9%
• Total Put/Call .67 -17.3%
• TRIN/Arms 1.25 +49.4%

Thursday Watch

Evening Headlines

Bloomberg:           

• China’s Sovereign Bonds Defy Expectations of an April Reckoning.  
• China Quant Giant Minghong Stems Losses After Record Redemptions.  
• China’s Post-Covid Travel Frenzy May Break Record This Labor Day.
• Shock and Tears: Behind Vanguard’s Retreat From China’s Market. 
• Samsung Profit Tops Estimates as Gadget Sales Soar in Pandemic.
• Asia Stocks to Rise, Futures Rally After Earnings: Markets Wrap. 
• Covid Boost for Global Car Sales to Spark a Surge in Oil Demand.
• Manchin Says Price Tag on Biden’s Plan Is ‘Uncomfortable’.  
• Facebook’s Sales, Users Jump as Pandemic Habits Persist.  
• Powell Breaks Out the ‘Froth’ Word When Asked About Markets.  
• Latest Sign of the Restaurant Rebound Is a Boom for Big Chickens.  
• Bank of America, Citi Risk Hit to Their Texas Businesses Over Gun Policies.  
• Powell Reins In the Treasury Market’s Angst with Dovish Message.

Wall Street Journal:

• Biden’s Cradle-to-Grave Government.
• Verizon Explores Sale of Media Assets.
• Joe Biden Is the Six Trillion Dollar Man.
• Your Woke Money Is No Good Here.
• Elon Musk’s War on Regulators.
• Private Equity and Hedge Funds, Facing a New Tax Burden, Prepare Their Defense.
• New SEC Enforcement Director Resigns, Agency Says.
• Robinhood Has a Customer Service Problem.

Fox News:

• Biden will vow to show 'forgotten' Americans that gov't still works - but for whom?
• Biden's $1.8T families plan isn't enough for progressives.
  

CNBC.com:

• Stocks making the biggest moves after the bell: Apple, Facebook, eBay & more.
• Chip shortages for iPads and Macs may cool Apple’s hot streak.
• Amazon to hike wages for over 500,000 workers.
• Zuckerberg outlines how Facebook will thrive after Apple privacy change.
• Lockdowns are lifting, but VCs remain bullish on food delivery start-ups.
• SEC delays decision on approving bitcoin ETF.

MarketWatch.com:       

• There’s one looming question about Biden’s proposed tax changes, and investors are waiting for the answer.  
• Ford swings to Q1 profit, but expects $2.5 billion hit from chip shortage.  
• Qualcomm stock rallies as earnings, outlook top Street estimates.  
• Elon Musk dubs himself ‘The Dogefather’ in SNL promo tweet, sparking a buying binge in the joke crypto.

Zero Hedge:

• Biden's First 100 Days: A Radical Transformation Of America.
• Manchin "Very Uncomfortable" With Biden's Trillion Dollar Plans.
• White House Insiders Oppose Biden Plan To "Share" Vaccines With India, Others.
• JPMorgan After Powell: "Buy Every Dip".
• Royal Farms Offers $500 Signing Bonus As Labor Shortage Intensifies.
• Biden Administration To Ban Menthol Cigarettes... Because They're 'Racist'?
• 50 Million People In Pathway Of Severe Storms From Texas To New York.
• Apple Soars After Blockbuster Quarter: Sales, EPS Smash Expectations, Buyback Boosted To $90BN.
• Trump To Restart MAGA Rallies As Early As May, Calls Potential 2024 Opponent 'Total Loser'.
• Dollar Dumps To 2-Month Lows, Ether Record Highs After Powell Promises Moar, Warns Of "Froth".

Newsmax:

• US Eyes Major Rollback in Iran Sanctions to Revive Nuke Deal.
• Biden to Name Rahm Emanuel Ambassador to Japan.
  

TheGatewayPundit.com:

• BREAKING EXCLUSIVE: New Judge in Election Case in Arizona, Judge Martin, Was Picked by Judge and Wife of Maricopa County Supervisor, Bill Gates! (AUDIO).
• WOW! DOJ Hacks Left Hunter Biden’s Computer Hard Drives in Rudy’s Apartment During Raid — TOOK EVERYTHING ELSE!
• “If This Can Happen to the President’s Lawyer, It Can Happen to Anyone!” – Andrew Giuliani LASHES OUT at Biden DOJ following Raid on His Father’s Home and Office. 
• Police Officer Who Made Viral TikTok Video Mocking LeBron James SUSPENDED — Fundraiser Launched.

The Epoch Times:

• Officials Summoned to Explain Failure to Produce Documents Regarding Transfer of Viruses to Wuhan Lab.

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 unch. to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 81.5 unch.

• China Sovereign CDS 38.0 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 61.26 +.05%.
• Bloomberg Global Risk-On/Risk Off Index 3,213.0 -1.0 point.
• Volatility Index(VIX) futures 19.6 -.3%.
• FTSE 100 futures +.06%.

• S&P 500 futures +.33%.

• NASDAQ 100 futures +.62%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AGCO)/1.11
• (ATI)-.25
• (ADS)/3.09
• (AB)/.76
• (MO)/1.04
• (AMT)/2.28
• (BAX)/.64
• (BLMN)/.32
• (BMY)/1.82
• (BC)/1.44
• (CAT)/1.88
• (CTXS)/1.43
• (CMCSA)/.58
• (DISH)/.84
• (DPZ)/2.93
• (FCN)/1.34
• (GNRC)/1.85
• (HSY)/1.80
• (ICE)/1.24
• (IP)/.64
• (KHC)/.60
• (LH)/7.43
• (MA)/1.56
• (MCD)/1.80
• (MRK)/1.63
• (TAP)/.01
• (NEM)/.91
• (NOC)/5.45
• (OSTK)/.04
• (PH)/3.71
• (RCL)/-4.62
• (SWI)/.19
• (STRA)/1.56
• (TROW)/2.87
• (VC)/.32
  

After the Close:

• (AEM)/.69
• (AMZN)/9.55
• (BZH)/.57
• (CRUS)/.71
• (DLR)/1.57
• (ETH)/.47
• (FSLR)/.77
• (FWRD)/.62
• (GILD)/2.08
• (KLAC)/3.59
• (MVIS)/-.02
• (MHK)/2.79 
• (SKYW)/.68
• (SWKS)/2.35
• (TRUP)/-.01
• (TWTR)/.14
• (X)/1.13
• (VRTX)/2.70
• (WDC)/.68
• (ZEN)/.12
  

Economic Releases

8:30 am EST

• Initial Jobless Claims for last week are estimated to fall to 540K versus 547K the prior week.
• Continuing Claims are estimated to fall to 3590K versus 3674K prior.
• 1Q GDP is estimated to rise +6.7% versus a +4.3% gain in 4Q.
• 1Q personal consumption is estimated to rise +10.5% versus a +2.3% gain in 4Q.
• The 1Q Core PCE QoQ is estimated to rise +2.4% versus a +1.3% gain in 4Q.
  

10:00 am EST

• Pending Home Sales MoM for March is estimated to rise +4.4% versus a -10.6% decline in Feb.
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Eurozone CPI report, weekly Langer Consumer Comfort Index and the weekly EIA natural gas inventory 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 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 Slightly Higher into Afternoon on Dovish FOMC Commentary, Stable Long-Term Rates, Oil Gain, Commodity/Financial Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Slightly Higher
  

• Sector Performance: Mixed
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 17.6 +.2%
• Bloomberg Global Risk On/Risk Off Index 3,230.0 +138.0 points

• Euro/Yen Carry Return Index 136.11 +.1%

• Emerging Markets Currency Volatility(VXY) 9.7 -.72%

• S&P 500 Implied Correlation 50.7 +5.4%

• ISE Sentiment Index 134.0 +29.0 points
  

• Total Put/Call .77 +11.6%

• NYSE Arms .70 -20.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 51.11 -.88%
  

• US Energy High-Yield OAS 441.72 -.83%

• European Financial Sector CDS Index 59.31 -.28%

• Italian/German 10Y Yld Spread 111.0 +4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 81.70 -1.27%
  

• Emerging Market CDS Index 167.56 -.68%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 39.15 -.12%

• 2-Year Swap Spread 11.75 +1.0 basis point

• TED Spread 18.0 +.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -2.75 +1.75 basis points
  
• MBS  5/10 Treasury Spread  64.25 -.25 basis point
  
• IHS Markit CMBX BBB- 6 71.5 +.25 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.08 +.30%
• 3-Month T-Bill Yield .01% unch.
  

• Yield Curve 145.0 +4.0 basis points
  

• China Iron Ore Spot 187.70 USD/Metric Tonne -.1%

• Citi US Economic Surprise Index 43.30 -.9 point

• Citi Eurozone Economic Surprise Index 121.9 -8.2 points
  

• Citi Emerging Markets Economic Surprise Index 43.3 +.5 point

• 10-Year TIPS Spread 2.42 +3.0 basis points
• 90.5% chance of no change at Sept. 22nd meeting, 86.2% chance of no change at Nov. 3rd meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -38 open in Japan 
• China A50 Futures: Indicating +10 open in China

• DAX Futures: Indicating +17 open in Germany

Portfolio:

• Slightly Higher: On gains in my medical/energy sector longs
  

• Disclosed Trades: None
  

• Market Exposure: 100% Net Long
  

Bear Radar

 Style Underperformer:

• Mid-Cap Growth -.4%

Sector Underperformers:

• 1) Disk Drives -1.2% 2) Software -1.2% 3) Semis -1.2%

Stocks Falling on Unusual Volume: 

• NYCB, FBC, HIG, SAVE, FCPT, CHRW, AAN, CHEF, ALDX, AMGN, HELE, FFIV, REVG, PINS, ENPH, AVIR and RVMD
  

Stocks With Unusual Put Option Activity:

• 1) FLEX 2) VXRT 3) AMGN 4) CNC 5) DISCK
  

Stocks With Most Negative News Mentions:

• 1) FSLY 2) SAVE 3) CYDY 4) EBON 5) RIDE
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value +.3%

Sector Outperformers:

• 1) Oil Service +5.5% 2) Energy +3.4% 3) Steel +1.3%

Stocks Rising on Unusual Volume:

• BTX, MVIS, CLOV, MANH, SLCA, CNTY, EVRI, CASH, MUDS, ETH, CVI, NCR, HRZN, MHO, TKR, GOOG, HYFM, EXTR, BSX, HRTX, SGMS, MDLZ, RTLR and ORIC
  

Stocks With Unusual Call Option Activity:

• 1) ADMA 2) LKQ 3) PBI 4) ATOS 5) NOV

Stocks With Most Positive News Mentions:

• 1) AVY 2) GOOG 3) V 4) BSX 5) COF
  

Charts:

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