Morning Market Internals

NYSE Composite Index:

• Volume Running -15.6% Below 100-Day Average
• 10 Sectors Rising, 1 Sector Declining
• 76.9% of Issues Advancing, 20.2% Declining
• 20 New 52-Week Highs, 34 New Lows
• 37.54% of Issues Above 200-day Moving Average
• Average 14-Day RSI 42.17%
• Vix 21.1 -7.6%
• Total Put/Call .97 -28.2%
• TRIN/Arms 1.0 +5.8%

Thursday Watch

Night Trading 

• Asian equity indices are -.25% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 79.25 +.5 basis point. 

• Asia Pacific Sovereign CDS Index 13.5 +.25 basis point.

• Bloomberg Emerging Markets Currency Index 75.10 +.01%.

• FTSE 100 futures +.02%.

• S&P 500 futures +.12%.

• NASDAQ 100 futures +.30%.

Morning Preview Links

Earnings of Note
Company/Estimate

• (ANGO)/.19

• (STZ)/1.74

• (FINL)/.58

• (WOR)/.75

• (TITN)/-.14

• (MOV)/.26

• (LNN)/.59

Economic Releases
8:30 am EST

• Personal Spending for February is estimated to rise +.2% versus a +.2% gain in January.

• Personal Income for February is estimated to rise +.4% versus a +.4% gain in January.

• The PCE Core MoM for February is estimated to rise +.2% versus a +.3% gain in January.

• Initial Jobless Claims for last week are estimated to rise to 230K versus 229K the prior week.

• Continuing Claims are estimated to rise to 1870K versus 1828K prior.

9:45 am EST

• The Chicago Purchasing Manager report for March is estimated to rise to 62.0 versus 61.9 in February.

Upcoming Splits

• None of note

Other Potential Market Movers

• The Fed's Harker speaking, Japan Unemployment report, Japan Industrial Production report, UK GDP report, weekly Bloomberg Consumer Comfort Index and the Sidoti Spring Conference could also impact trading today.

BOTTOM LINE:  Asian indices are mostly higher, boosted by pharma and industrial shares in the region. I expect US stocks to open modestly higher and to weaken into the afternoon, finishing mixed.  The Portfolio is 50% net long heading into the day.

Stocks Slightly Higher into Final Hour on Earnings Optimism, Buyout Speculation, Yen Weakness, Retail/Biotech Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 24.1 +7.0%

• Euro/Yen Carry Return Index 136.88 +.61%

• Emerging Markets Currency Volatility(VXY) 8.02 -.25%

• S&P 500 Implied Correlation 50.99 +3.93%

• ISE Sentiment Index 121.0 unch.
  

• Total Put/Call 1.34 +25.23%

• NYSE Arms .95 -38.62%

Credit Investor Angst:

• North American Investment Grade CDS Index 67.63 +1.21%
  

• America Energy Sector High-Yield CDS Index 444.0 +.29%

• European Financial Sector CDS Index 67.96 +1.58%

• Italian/German 10Y Yld Spread 133.75 -5.0 basis points
  

• Asia Pacific Sovereign Debt CDS Index 13.45 +1.81%

• Emerging Market CDS Index 141.53 -1.65%
  

• iBoxx Offshore RMB China Corporate High Yield Index 148.69 +.07%

• 2-Year Swap Spread 28.0 unch.

• TED Spread 55.25 +3.75 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -7.75 -3.5 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 75.08 -.31%
• 3-Month T-Bill Yield 1.72% -3.0 basis points
  

• Yield Curve 49.25 -1.5 basis points

• China Iron Ore Spot 63.20 USD/Metric Tonne +.19%

• Citi US Economic Surprise Index 48.7 +1.5 points

• Citi Eurozone Economic Surprise Index -57.20 +.3 point

• Citi Emerging Markets Economic Surprise Index 31.70 -1.3 points

• 10-Year TIPS Spread 2.06 -1.0 basis point
  
• 79.4% chance of Fed rate hike at June 13 meeting, 80.3% chance at August 1 meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating +254 open in Japan 
• China A50 Futures: Indicating -104 open in China

• DAX Futures: Indicating -4 open in Germany

Portfolio: 

• Higher: On gains in my biotech/retail sector longs, index hedges and emerging markets shorts

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

• Market Exposure: Moved to 50% Net Long

Today's Headlines

Bloomberg:

• U.S. ‘Hopeful’ of New Nafta Deal in Near Future, Lighthizer Says. (video)
• Early China Indicators Show Outlook Undimmed by Trade Tension.
• Quant Style Crash That Strategists Warned About Finally Arrives.
• Health Care M&A Booming in Busiest Start in More Than a Decade. (video)
• Tech Stocks Fear Premium Just Jumped to a 13-Year High.

Wall Street Journal:

• In Politics vs. Tech Profits, Investors Are the Losers. The market is waking up to risks, and economic realities, facing once-highflying stocks.
• Why Are States So Strapped for Cash? There Are Two Big Reasons. The proportion of state and local tax revenues dedicated to Medicaid and public pensions is the highest since the 1960s.

Fox News: 

• Despite media narrative, study says teenagers made up just 10 percent of March for Our Lives crowd.

CNBC:

• Big Pharma's billion-dollar scramble to invest in start-ups to fuel innovation.
• Tim Cook on Facebook's(FB) data leak scandal: 'I wouldn't be in this situation'.
• Bitcoin is nearing a 'death cross' on the charts. Here’s what it means.
• Oil sinks 1.3%, settling at $64.38, as US crude stockpiles rise and geopolitical risk fades. (video)
• Democrats bet on moderates, military veterans to win in GOP House districts, but the strategy faces big tests as the left pushes more liberal stances.

Zero Hedge:

• Tesla(TSLA) Bonds, Stock In Freefall As Company Pleads Ignorance Over Fatal Crash.
• WTI/RBOB Pump'n'Dump After Huge Cushing Build, Record Crude Production. (graph)
• FANG Stocks In Freefall; Amazon Plunges On Trump Retaliation Fears. (graph)
• Pending Home Sales Tumble Year-Over-Year. (graph)
• Q4 GDP Revised Sharply Higher To 2.9% As US Economy Grew 2.3% In 2017. (graph)
• "If We Build It...?" - Wholesale Inventories Surge Most In 5 Years. (graph)
• Goldman Slashes iPhone Sales Estimates Due To "Demand Deterioration".
• Facebook(FB) Changes Privacy Tools, Allowing Users To Delete Data.
• "Want To Freak Yourself Out?" Here Is All The Personal Data That Facebook/Google Collect.

Business Insider:

• Trump keeps backing down from his worst impulses — and it could be great news for the economy.
• Wealthy shoppers are going crazy over this jacket that costs $90 on Amazon — and it should terrify Canada Goose(GOOS).
• A vape pen with twice the nicotine of comparable devices is taking over high schools — and adults are frightened.

Bear Radar

Style Underperformer:

• Mid-Cap Growth -.4%

Sector Underperformers:

• 1) Gold & Silver -2.0% 2) Semis -1.7% 3) Oil Service -1.5%

Stocks Falling on Unusual Volume: 

• CXO,TSLA, SCVL, SGH, EEFT, AXGN, NFLX, TWOU, SQ, AMZN, RHT, SHOP, PTCT and SINA

Stocks With Unusual Put Option Activity:

• 1) EMB 2) BBT 3) STI 4) PTLA 5) NOW

Stocks With Most Negative News Mentions:

• 1) TSLA 2) AMZN 3) RIOT 4) GERN 5) SLDB

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +.3%

Sector Outperformers:

• 1) Pharma +1.9% 2) REITs +1.7% 3) Retail +1.1%

Stocks Rising on Unusual Volume:

• RSPP, IEFA, LHO, SHPG, RH, LULU, GRFS, EFAV, EGN, QIQI, EZU, OMN, ANAB, PEB, SGMO, KTOS, DRH, SNN, INOV, RYAM, FB, LZB, TWTR, DXCM, PLT and MPW

Stocks With Unusual Call Option Activity:

• 1) RH 2) FINL 3) RHT 4) VMW 5)LYB

Stocks With Most Positive News Mentions:

• 1) LULU 2) RH 3) JEC 4) RAD 5) QIWI

Charts:

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