Tuesday, May 13, 2025

Wednesday Watch

Around X:

  • @ElonMusk
  • @ZeroHedge
  • @MarioNawful
  • SEN. HAWLEY: WI JUDGE INDICTED FOR OBSTRUCTING JUSTICE—“YOU’RE NOT ABOVE THE LAW”. "This judge committed a federal crime—obstructing justice—and I’m glad she got indicted. Too many judges act like dictators, running the country instead of following the law. This one flouted justice while defending gang members and terrorists. Prosecute her fully. Let this be a lesson: you are not above the law." (video)
  • SPEAKER JOHNSON: MEDICAID CUT CLAIMS ARE SIMPLY NOT TRUE. "Even before the bill text had come out, they were running ads and put billboards up around the country suggesting we were cutting Medicaid. It's simply not true, and we were able to get the ads pulled down because they were based on false information. The bill text was just filed on Monday, yesterday morning, and people are going through that and understanding what we're actually doing.” (video)
  • HASSETT: WHILE BIDEN SLEPT, CHINA SPREAD—NOW TRUMP’S GOLDEN AGE IS HERE. National Economic Council Director Kevin Hassett: "Biden was asleep in the Oval—no deals, no defense of U.S. workers. China filled the void. But now we’ve got an activist president. Inflation is falling, egg prices are down 12%, tariff revenue is rising, and everyone wants to sign with us. Trump knows how to build a golden age—and it’s happening." (video)
  • CORTEX 2.0: TESLA'S NEXT SUPERCOMPUTER TAKES SHAPE IN TEXAS. Tesla’s Giga Texas campus is quietly transforming again—this time into the home of “Cortex 2.0,” the company’s next-gen supercomputer hub. What started as a simple support facility has now been refiled under a name that signals serious AI horsepower. Drone footage confirms rapid progress on the site. Insiders say this isn’t just for Full Self-Driving. Optimus—the humanoid robot—needs training too. Between Robotaxi rollout and Musk’s vision of AI abundance, Cortex 2.0 might just be the brain behind it all. And it’s coming online fast. 
  • CHINESE SPIES DISGUISE AS STUDENTS TO STEAL AI RESEARCH BUT BLOW COVER BY INSISTING ON WECHAT ONLY. Stanford Review investigation reveals Chinese Ministry of State Security agents posing as students to extract sensitive AI and robotics research from unsuspecting Americans. 
  • AWS AND SAUDI ARABIA LAUNCH $5B+ AI ZONE TO DOMINATE THE GLOBAL AI RACE. Amazon Web Services and Saudi Arabia’s HUMAIN are pouring over $5 billion into a massive AI buildout—including new infrastructure, AI services, and workforce training. This “AI Zone” will feature AWS’s top tools—SageMaker, Bedrock, and Amazon Q—plus high-performance semiconductors and Ultrafast AI networks to power everything from coding assistants to Arabic-language LLMs. 
  • U.S. ENERGY DEMAND SURGES — SOLAR AND BATTERY STORAGE RACE TO CATCH UP. Electricity use in the U.S. is expected to break records again in 2025 and 2026, pushing utilities to rapidly expand solar and battery storage, says the Energy Information Administration. Solar leads the charge with 135 GW added between 2020–2026. Battery storage is next, adding 57.5 GW—outpacing new wind and gas. Coal? Down 50 GW. Texas is ahead of the pack with nearly 20 GW in new battery storage planned—boosting grid reliability and lowering costs. Storage is now critical infrastructure, keeping the lights on when renewables dip. In 2024 alone, 10.3 GW of new storage came online.
  • @LauraLoomer
  • @WallStreetApes
  • EXPOSED. Tax Forms reveal the secret relationship between Democrats and The Pope. “Joe Biden meets with Pope Francis in 2021. Guess what else happens in 2021. Catholic Charities USA, which is the NGO nonprofit arm of the Catholic Church, they get selected to serve as the leader for multiple states by Joe Biden's Department of Health and Human Services, Office of Refugee Resettlement. So this is a new designation the Catholic Church gets. They get a significant amount of money, like a lot. (video)
  • @JamesOKeefeIII
  • @DerrickEvans4WV
  • @RodDMartin
  • @unusual_whales 
  • BREAKING: Nancy Pelosi bought $TEM Tempus AI calls at $15.15 on Jan 14th, 2025. She paid just over $75,000 for these contracts. $TEM is up 10% today, 100% on the year. She is up millions. You can only track her option positions exits in real time one place, Unusual Whales.
  • @nicksortor
  • @realTrentLeisy
  • @IanJaeger29
  • @amitisinvesting
  • @stkirsch 
  • @catturd2
Night Trading 
  • Asian equity indices are +.25% to +1.25% on average. 
  • Asia Ex-Japan Investment Grade CDS Index 80.0 unch. 
  • China Sovereign CDS 52.0 +1.5 basis points.
  • China Iron Ore Spot 100.7 USD/Metric Tonne +1.2%
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.58 +.05%.
  • Bloomberg Emerging Markets Currency Index 37.0 +.03%.
  • Bloomberg Global Risk-On/Risk Off Index 70.2 +.9%.
  • US 10-Year Yield 4.48% +1.0 basis point.
  • Volatility Index(VIX) futures 19.5 +1.2%.
  • Euro Stoxx 50 futures -.33%. 
  • S&P 500 futures -.09%. 
  • NASDAQ 100 futures -.12%.
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 mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 100% net long heading into the day.

Stocks Surging into Final Hour on US-Global Trade Deals, Rising US Economic Acceleration Odds, Earnings Outlook Optimism, Tech/Transport Sector Strength

Broad Equity Market Tone:

  • Advance/Decline Line: Substantially Higher
  • Sector Performance: Most Sectors Rising
  • Volume: Above Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 18.0 -2.0%
  • S&P 500 Intraday % Swing .94 +26.9%
  • Bloomberg Global Risk On/Risk Off Index 70.4 -1.1% 
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.55 +.5%
  • Euro/Yen Carry Return Index 185.4 +.27%
  • Emerging Markets Currency Volatility(VXY) 8.2 -4.8%
  • CBOE S&P 500 Implied Correlation Index 20.6 -13.0% 
  • ISE Sentiment Index 159.0 +27.0
  • Total Put/Call .72 -15.3%
  • NYSE Arms 1.0 +31.6%
  • NYSE Non-Block Money Flow +$162.8M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 54.1 -2.3%
  • US Energy High-Yield OAS 400.7 -2.3%
  • Bloomberg TRACE # Distressed Bonds Traded 248.0 -8.0
  • European Financial Sector CDS Index 60.0 -3.7%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 144.9 -3.2%
  • Italian/German 10Y Yld Spread 102.0 basis points -3.0 basis points
  • Asia Ex-Japan Investment Grade CDS Index 80.7 -.1%
  • Emerging Market CDS Index 168.0 -2.7%
  • Israel Sovereign CDS 101.6 -1.4%
  • China Corp. High-Yield Bond USD ETF(KHYB) 23.94 +.16%
  • 2-Year SOFR Swap Spread -21.25 basis points +.25 basis point
  • 3M T-Bill Treasury Repo Spread 10.25 basis point -.75 basis point
  • 3-Month EUR/USD Cross-Currency Basis Swap -1.5 unch.
  • MBS  5/10 Treasury Spread 150.0 +2.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 634.0 -2.0 basis points
  • Avg. Auto ABS OAS 70.0 -1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 36.95 +.3% 
  • US 10-Year T-Note Yield 4.50% +3.0 basis points
  • 3-Month T-Bill Yield 4.37% -2.0 basis points
  • China Iron Ore Spot 100.5 USD/Metric Tonne +1.0%
  • Dutch TTF Nat Gas(European benchmark) 35.74 euros/megawatt-hour +1.0%
  • Citi US Economic Surprise Index -8.3 -3.0 points
  • Citi Eurozone Economic Surprise Index 15.8 +5.3 points
  • Citi Emerging Markets Economic Surprise Index 26.9 +.1 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(455 of 500 reporting) +12.2% -.1 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 276.50 +.16:  Growth Rate +12.1% unch., P/E 21.3 +.3
  • S&P 500 Current Year Estimated Profit Margin 13.34% +1.0 basis point
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +29.1% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 425.13 +.35: Growth Rate +22.9% +.1 percentage point, P/E 31.9 +1.1
  • Bloomberg US Financial Conditions Index .35 +27.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.30 +11.0 basis points
  • Bloomberg Global Trade Policy Uncertainty Index 8.6 -.3 point
  • US Yield Curve 48.25 basis points (2s/10s) +2.75 basis points
  • US Atlanta Fed GDPNow Q2 Forecast +2.3% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 37.6% +1.4 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.60% -1.0 basis point: CPI YoY +2.40% +6.0 basis points
  • 1-Year TIPS Spread 2.80 -6.0 basis points
  • 10-Year TIPS Spread 2.34 +3.0 basis points
  • Highest target rate probability for July 30th FOMC meeting: 63.3% (+1.9 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Sept. 17th meeting: 51.2%(-1.7 percentage points) chance of 4.0%-4.25%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +300 open in Japan 
  • China A50 Futures: Indicating +22 open in China
  • DAX Futures: Indicating +65 open in Germany
Portfolio:
  • Higher: On gains in my consumer discretionary/utility/technology/industrial/financial sector longs
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

Bear Radar

Style Underperformer:

  • Large-Cap Value +.1%
Sector Underperformers:
  • 1) Healthcare Providers -4.9% 2) Pharma -1.7% 3) Biotech -1.3%
Stocks Falling on Unusual Volume: 
  • CAE, CAMT, IIIV, ARGX, LEGN, BCO, LOAR, HMC, TARS, SPG, POWI, ENPH, HUM, BBIO, BCAX, SATS, UTI, RPD, ELV, IGT, FLOC, PONY, ODD, RGTI, PSFE, UNH, XENE, HALO and NCTL
Stocks With Unusual Put Option Activity:
  • 1)  2) EH 3) INDA 4) PONY 5) ZI
Stocks With Most Negative News Mentions:
  • 1) HTZ 2) HALO 3) DDD 4) HALO 5) UNH
Sector ETFs With Most Negative Money Flow:
  • 1) KBWB 2) XOP 3) QTEC 4) IYW 5) OIH

Bull Radar

Style Outperformer:

  • Mid-Cap Growth +2.5%
Sector Outperformers:
  • 1) Alt Energy +4.0% 2) Semis +3.3% 3) Airlines +2.7%
Stocks Rising on Unusual Volume:
  • LSEA, LIF, LUNR, SMR, OCIN, FSLR, ACHR, HNRG, GRAL, RUN, SMCI, HIMS, ONON, GCT, OKLO, TEM, PLTR, CLS, HOOD, PERI, ARWR, NXT, BZH, APP, DQ, SE, ALAB, QXO, SEZL, VG, CRDO, RUM, VST, NNE, AAOI, COOP, MNDY, NTNX, ACHC, RDNT, RBRK, SOC, AVPT, NVDA, GEV, PRIM, NBIS, WGS, CVNA, RYET, FTK, NET, PSX, VTLE, RKT, AES, LASR, BLDR, ZIM, CLMT, JD, DXYZ, VIV, HUT, FOXA, BTSG, RDW, WDS, CTRI, AMRC, ELF, KLAC, HSAI, OEC, TITN, SN, RBLX, AAL, NRG, MU, TOST, XYZ, AS, AMD, VCTR, SHOP, QNST, AEVA, GLNG, PSIX, NEE, PAM, TME, MATX, HRTG, ONTO, CAT, NVT, SMLR, PAR, MPC, FROG, BA, XP, WNS, XP, ECG, LQDT, IMXI, GLPG, OSCR, ROK, GLBE, TEN, GDEN, XYF, AFRM and GLPG
Stocks With Unusual Call Option Activity:
  • 1) PSX 2) NEXT 3) IGT 4) MVST 5) CONL
Stocks With Most Positive News Mentions:
  • 1) ONON 2) COIN 3) HIMS 4) RUN 5) OPRX
Sector ETFs With Most Positive Money Flow:
  • 1) SOXX 2) IYT 3) XRT 4) SMH 5) XLF
Charts:

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

Earnings of Note 
Company/Estimate 

Before the Open:
  • (TSEM)/.38
After the Close: 
  • (BOOT)/1.24
  • (CSCO)/.92
  • (JACK)/1.11
  • (LGF/A)/.42
  • (STE)/2.60
  • (TGI)/.35
Economic Releases

10:30 am EST

  • Bloomberg consensus estimates call for a weekly crude oil inventory decline of -1,776,200 barrels versus a -2,032,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -775,200 barrels versus a +188,000 barrel gain the prior week. Distillate inventories are estimated to rise by +23,400 barrels versus a -1,107,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to rise by +.42% versus a +.4% gain prior.

Upcoming Splits

  • None of note
Other Potential Market Movers
  • The Fed's Daly speaking, Fed's Jefferson speaking, weekly MBA Mortgage Applications report, (HES) annual meeting, (HOG) annual meeting, (RHI) annual meeting, (FSLR) annual meeting, (LUV) annual meeting, (AMD) annual meeting, (CSGS) annual meeting, (AAP) annual meeting, (GEV) annual meeting, (STT) annual meeting, (CAR) annual meeting, (OC) investor day, BMO Farm to Market Conference, BofA Industrials/Trnaports/Airlines Key Leaders Conference and the JPMorgan Tech/Media/Communications 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 +18.1% Above 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 14.9 +.5
  • 3 Sectors Declining, 8 Sectors Rising
  • 65.5% of Issues Advancing, 32.1% Declining 
  • TRIN/Arms .94 +23.7%
  • Non-Block Money Flow +$252.0M
  • 66 New 52-Week Highs, 25 New Lows
  • 41.9% (+15.3%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 64.9 +2.2
Other:
  • Bloomberg Global Risk-On/Risk-Off Index 70.0 -1.6%
  • Bloomberg Cyclicals/Defensives Index 246.1 +1.8%
  • Russell 1000: Growth/Value 20,956.8 +1.4%
  • CNN Fear & Greed Index 69.0 (GREED) +3.0
  • 1-Day Vix 12.3 -34.5%
  • Vix 17.9 -2.6%
  • Total Put/Call .72 -15.3%