Wednesday Watch

Evening Headlines

Bloomberg:        

• U.S. Futures Fluctuate; Asian Stocks Set to Slip: Markets Wrap.
• Romney Says Trump Would Win 2024 GOP Nomination If He Runs.
• Keystone XL’s Death Sparks Rush to Ship Oil-Sands Crude by Rail.  
• Powell Signals Fed to Keep Buying Bonds Even as Outlook Improves.  
• Covid Death Outlook Improves as Drop in U.S. Exceeds Forecasts.  
• Cities Are Sinking Under the Weight of Urban Development.  
• Toll Brothers’ Home Orders Jump in Pandemic-Era Buying Boom.  
• GameStop’s Board Pushed CFO Out to Speed Up Strategic Shift.

Wall Street Journal: 

• Novavax Nears Covid-19 Vaccine Game Changer—After Years of Failure.
• China’s Reckless Labs Put the World at Risk.
• Tech Censorship Is Accelerating.
• What’s in Joe Biden’s ‘American Rescue Plan’?
• Home Depot, Macy’s Expect Shopping Trends to Continue.

Fox News:

• Officials say Woods showed 'no evidence of impairment' in crash; probe could take weeks.
• Trump sends Woods get well soon message.
• How Psaki explains reopening of migrant facility for children under Biden.
  

CNBC.com:

• AT&T nears deal with TPG to sell large minority stake in DirecTV, U-verse at $15 billion valuation.
• High-profile SPAC craters after announcing plan to merge with electric car company Lucid.
• Square buys $170 million worth of bitcoin.
• Apple shareholders approve executive compensation; dividend increase coming.
• Stocks making the biggest moves after the bell: GameStop, Square, Intuit & more.
• Tesla drops as much as 13%, turns negative for the year.

MarketWatch.com:       

• Workhorse stock plunges after news Oshkosh wins USPS contract.  
• The bitcoin bubble could be popping. It’s a headwind for some high-flying stocks.  
• These are the stocks helping to tank the high-flying ARK Innovation ETF over the past week.  
• If you think it’s time to shift to value stocks, here are Wall Street’s favorites.

Zero Hedge:

• Softbank Reportedly Eyes Billion-Dollar Biotech Bet.
• "The Dam Is Going To Break": We Are In The Early Innings Of A Colossal Migration Into Commodities.
• Board Leaders Of Texas Power Grid Resign After Blackout Outrage.
• GOP Senators Counter Democrats With $10 Minimum Wage By 2025.
• If You Believe Life Will "Return To Normal", You Have A Fundamental Misunderstanding Of The Times In Which We Live.
• Here's How Much Wasteful Spending Is In The New $1.9 Trillion Stimulus Bill.
• WTI Tumbles After Surprise Crude, Gasoline Builds.
• Greenwald: House Dems Demand To Know Why Cable Outlets Aren't Censoring Right-Wing News.
• Momo Dumps, Powell Pumps, Crypto Slumps.

Newsmax:    

• Senate Democrat Directs Lawmakers to Craft Bill to Counter China.

TheGatewayPundit.com:

• WTH Was This? Biden Mumbles Reading Covid Card in Bizarre Display (VIDEO).
• System Overwhelmed by Thousands of Migrant Children Flooding US Border After Biden Reverses Trump Policy.
• UPDATE: BLM-Antifa Organizer John Sullivan, Who Was Arrested After Storming US Capitol, Bashing Windows Is Writing a Book, Being Paid for Video as Trump Supporters Rot in Jail.
• Breaking: GOP Leader Mitch McConnell Announces Support for Merrick Garland for Attorney General.
• “Give My Regards to Your Puppet Master” – Elon Musk to Washington Post Reporter.

The Epoch Times:

• China Insider: Thousands Protest Long-Term Lockdown in China’s Virus Hotspot.

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 -.5% to +.5% on average.

• Asia Ex-Japan Investment Grade CDS Index 58.0 -.5 basis point.

• China Sovereign CDS 29.25 -.25 basis point.

• Bloomberg Emerging Markets Currency Index 62.74 +.03%.
• Bloomberg Global Risk-On/Risk Off Index 2,762.0 +27.0 points.
• Volatility Index(VIX) futures 24.9 +.6%.
• FTSE 100 futures +.17%.

• S&P 500 futures +.14%.

• NASDAQ 100 futures +.20%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (EV)/.89
• (ELAN)/.10
• (EXC)/.66
• (FDP)/-.14
• (ITRI)/.30
• (LOW)/1.21
• (ODP)/.83
• (OSTK)/.05
• (RGEN)/.31
• (SINA)/.86
• (TEN)/1.04
• (TJX)/.61
• (UTHR)/3.51
• (WEX)/1.47
  

After the Close:

• (DDD)/.10
• (APA)/-.13
• (BKNG)/-3.59
• (GH)/-.47
• (LB)/2.11
• (NTAP)/1.01
• (NVDA)/1.98
• (PSA)/2.85
• (RDFN)/.04
• (RCII)/1.02
• (STAA)/.10
• (TDOC)/-.27
• (UPLD)/.45
  

Economic Releases

10:00 am EST

• New Home Sales for Jan. is estimated to rise to 855K versus 842K in Dec. 

10:30 am EST

• Bloomberg consensus estimates call for a crude oil inventory decline of -6,742,000 barrels versus a -7,2457,000 barrel decline the prior week. Gasoline supplies are estimated to fall by -3,515,730 barrels versus a +672,000 barrel gain the prior week. Distillate inventories are estimated to fall by -4,718,450 barrels versus a -3,422,000 barrel decline the prior week. Finally, Refinery Utilization is estimated to fall by -6.99% versus a +.1% gain prior.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Powell testifying to House, Fed's Clarida speaking, Fed's Brainard speaking, German GDP report, $61B 5Y T-Note auction, weekly MBA Mortgage Applications report, Credit Suisse Financial Services Forum, Wells Fargo Real Estate Conference, Citi Healthcare Services/Medtech/Tools/HCIT Conference, (MAT) analyst day and the (STX) analyst event could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by technology 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 75% net long heading into the day.

Stocks Finish Mostly Higher on Stable Long-Term Rates, Dovish Fed Commentary, Oil Gain, Energy/Gaming Sector Strength

 Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Mixed
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 22.9 -2.24%
• Bloomberg Global Risk On/Risk Off Index 2,7649.0 +76.0 points

• Euro/Yen Carry Return Index 132.29 +.11%

• Emerging Markets Currency Volatility(VXY) 9.97 -.5%

• S&P 500 Implied Correlation 52.3 -1.89%

• ISE Sentiment Index 108.0 -28.0 points
  

• Total Put/Call .77 +13.2%

• NYSE Arms .68 -4.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 52.61 -1.5%
  

• US Energy High-Yield OAS 485.66 +.12%

• European Financial Sector CDS Index 60.65 +1.97%

• Italian/German 10Y Yld Spread 96.0 +2.25 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 58.35 +1.28%
  

• Emerging Market CDS Index 171.45 -2.18%
  

• iBoxx Offshore RMB China Corporate High Yield Index 186.12 +.11%

• 2-Year Swap Spread 9.25 -.5 basis point

• TED Spread 15.5 +.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -3.25 +.25 basis point
  
• MBS  5/10 Treasury Spread  82.75 +1.25 basis points
  
• IHS Markit CMBX BBB- 6 75.75 unch.

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 62.73 +.05%
• 3-Month T-Bill Yield .03% unch.
  

• Yield Curve 128.0 unch.
  

• China Iron Ore Spot 169.5 USD/Metric Tonne -1.1%

• Citi US Economic Surprise Index 75.7 +2.6 points

• Citi Eurozone Economic Surprise Index 153.6 -2.1 points
  

• Citi Emerging Markets Economic Surprise Index 62.1 -1.6 points

• 10-Year TIPS Spread 2.17 unch.
• 100.0% chance of no change at April 28th meeting, 100.0% chance of no change at June 16th meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -161 open in Japan 
• China A50 Futures: Indicating -53 open in China

• DAX Futures: Indicating +30 open in Germany

Portfolio:

• Higher: On gains in my energy/industrial/medical sector longs, index hedges and emerging market shorts
  

• Disclosed Trades: None
  

• Market Exposure: 75% Net Long
  

Bear Radar

 Style Underperformer:

• Small-Cap Growth -2.6%

Sector Underperformers:

• 1) Alt Energy -4.7% 2) Oil Service -3.0% 3) Gold & Silver -3.0%

Stocks Falling on Unusual Volume: 

• WIFI, U, PLTR, RSI, SPNV, MXL, RAVN, CHGG, SQ, EYPT, MWK, SOAC, VCYT, EBS, PDAC, CURI, VIVO, NKTX, CRMD, HIMS, TTD, FMAC, HAAC, IPOE, FMAC, HAAC, NKTX, FRX, AACQ, OPEN, CLPT, FRPT, IRDM, DCRB, RSAC, DNMR, APPH, CMLF, SNPR, SFTW, PRCH, GSAH, GDOT, LDOS, BCC, TWOU, TREX, RTP, BIGC, EXPC, SSYS, PSTX, LPSN, ACIC, ARNC, XPEL, TMDX, TPGY, NPA, RSVA, BEAM, VIH, HOL, RLGY, LQDT, REAL, MSTR, XONE, NLS, EBIX, SI and CCIV
  

Stocks With Unusual Put Option Activity:

• 1) ARKK 2) MTDR 3) NLS 4) IP 5) ARKW
  

Stocks With Most Negative News Mentions:

• 1) EBIX 2) REAL 3) EH 4) SOS 5) BTBT
  

Charts:

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

Bull Radar

Style Outperformer:

• Large-Cap Value -.1%

Sector Outperformers:

• 1) Gaming +2.0% 2) Energy +1.4% 3) Airlines +1.1%

Stocks Rising on Unusual Volume:

• EVER, GATO, ERII, ZI, XEC, NXST, CAR, PRIM, HSC, MRO, BOX, AWI, BCO, FIVN, DEI, MEG, WYNN, LVS, VNO, MGM, RCUS, SPWR, DTE, ALK, SNAP, SATS, LEGN, FANG, GMTX and PK
  

Stocks With Unusual Call Option Activity:

• 1) LFMD 2) ZGNX 3) PRTY 4) TER 5) BOX

Stocks With Most Positive News Mentions:

• 1) M 2) MCK 3) MDT 4) FIS 5) NVDA
  

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running +58.7% Above 100-Day Average 
• 4 Sectors Rising, 7 Sectors Declining
• 26.7% of Issues Advancing, 71.2% Declining
• 146 New 52-Week Highs, 43 New Lows
• 83.3% of Issues Above 200-day Moving Average
• Average 14-Day RSI 51.0% 
• Bloomberg Global Risk-On/Risk-Off Index 2,604.0 -69.0 points
• Vix 24.6 +5.0%
• Total Put/Call .75 +10.3%
• TRIN/Arms .84 +18.3%

Tuesday Watch

Night Trading 

• Asian equity indices are -.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 58.25 +1.25 basis points.

• China Sovereign CDS 29.5 +.75 basis point.

• Bloomberg Emerging Markets Currency Index 62.75 +.08%.
• Bloomberg Global Risk-On/Risk Off Index 2,692.0 +19.0 points.
• Volatility Index(VIX) futures 25.45 -1.75%.
• FTSE 100 futures +.08%.

• S&P 500 futures +.34%.

• NASDAQ 100 futures +.55%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AWI)/.67
• (BCO)/1.01
• (CBRL)/.75
• (HD)/2.37
• (LDOS)/1.61
• (M)/.12
• (MDT)/1.15
  

After the Close:

• (COG)/.20
• (DDS)/2.65
• (FLS)/.53
• (INTU)/.67
• (JAZZ)/4.20
• (MCFE)/.31
• (MELI)/.14
• (MYGN)/-.12
• (PXD)/.70
• (RRGB)/-1.08
• (SQ)/.24
• (SUM)/.17
• (TOL)/.46
  

Economic Releases

9:00 am EST

• The House Price Purchase Index for 4Q.
• The FHFA House Price Index MoM for Dec. is estimated to rise +1.0% versus a +1.0% gain in Nov.
• The S&P CoreLogic CS 20-City MoM for Dec. is estimated to rise +1.2% versus a +1.42% gain in Nov.
  

10:00 am EST

• The Conference Board Consumer Confidence Index for Feb. is estimated to rise to 90.0 versus 89.3 in Jan.
• The Richmond Fed Manufacturing Index for Feb. is estimated to rise to 16.0 versus 14.0 in Jan. 

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Powell testimony to Senate, $2Y $60B T-Note auction, UK Unemployment report, Eurozone Inflation data, weekly US retail sales reports, Senate Intel Heading on SolarWinds hack, Keefe Bruyette Woods Payments Finance/FinTech Conference, UBS Chemicals Conference, (CG) investor day and the (SNAP) investor day could also impact trading today.

Market Hours
Normal:

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by commodity 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 75% net long heading into the day.