BETWEEN THE HEDGES

Thursday, February 25, 2021

Friday Watch

Posted by Gary .....at 8:35 PM

Night Trading

Asian equity indices are -2.25% to -1.25% on average.

Asia Ex-Japan Investment Grade CDS Index 60.25 +3.5 basis points.

China Sovereign CDS 31.75 +2.5 basis points.

Bloomberg Emerging Markets Currency Index 61.96 -.13%.
Bloomberg Global Risk-On/Risk Off Index 2,497.0 -66.0 points.
Volatility Index(VIX) futures 26.7 -5.6%.
FTSE 100 futures -1.0%.

S&P 500 futures +.11%.

NASDAQ 100 futures-.26%.

Morning Preview Links

Earnings of Note
Company/Estimate

Before the Open:

(CRI)/2.73
(DKNG)/-.49
(FLR)/.21
(FL)/1.35
(SSP)/.87
(STRA)/1.50

After the Close:

None of note

Economic Releases

8:30 am EST

The Advance Goods Trade Balance for Jan. is estimated to widen to -$83.0B versus -$82.5B in Dec.
Wholesale Inventories MoM for Jan. is estimated to rise +.4% versus a +.3% gain in Dec.
Retail Inventories MoM for Jan. is estimated to rise +.5% versus a +1.0% gain in Dec.
Personal Income for Jan. is estimated to rise +9.5% versus a +.6% gain in Dec.
Personal Spending for Jan. is estimated to rise +2.5% versus a -.2% decline in Dec.
The PCE Core MoM for Jan. is estimated to rise +.1% versus a +.3% gain in Dec.

9:45 am EST

The MNI Chicago PMI for Feb. is estimated to fall to 61.0 versus 63.8 in Jan.

Upcoming Splits

None of note

Other Potential Market Movers

The Senate Intel Hearing on SolarWinds hack and the Eurozone Import Price report 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 lower and to maintain losses into the afternoon. The Portfolio is 50% net long heading into the day.

Stocks Lower into Afternoon on Rising Long-Term Rates, Valuation Concerns, Emerging Market Debt Angst, Tech/Homebuilding Sector Weakness

Posted by Gary .....at 2:38 PM

Broad Equity Market Tone:

Advance/Decline Line: Substantially Lower

Sector Performance: Almost Every Sector Declining

Volume: Heavy

Market Leading Stocks: Performing In Line

Equity Investor Angst:

Volatility(VIX) 27.0 +26.8%
Bloomberg Global Risk On/Risk Off Index 2,680.0 -121.0 points

Euro/Yen Carry Return Index 133.53 +.23%

Emerging Markets Currency Volatility(VXY) 10.0 +1.0%

S&P 500 Implied Correlation 54.4 +9.4%

ISE Sentiment Index 100.0 -36.0 points

Total Put/Call .74 +7.3%

NYSE Arms .73 +14.0%

Credit Investor Angst:

North American Investment Grade CDS Index 55.17 +6.1%

US Energy High-Yield OAS 474.85 -1.37%

European Financial Sector CDS Index 62.02 +3.48%

Italian/German 10Y Yld Spread 104.0 +4.0 basis points

Asia Ex-Japan Investment Grade CDS Index 57.78 -.27%

Emerging Market CDS Index 181.89 +8.22%

iBoxx Offshore RMB China Corporate High Yield Index 186.33 +.04%

2-Year Swap Spread 8.75 +.5 basis point

TED Spread 15.25 +.25 basis point

3-Month EUR/USD Cross-Currency Basis Swap -4.75 -1.0 basis point
MBS 5/10 Treasury Spread 86.25 +1.75 basis points
IHS Markit CMBX BBB- 6 75.5 unch.

Economic Gauges:

Bloomberg Emerging Markets Currency Index 62.17 -1.01%
3-Month T-Bill Yield .04% +1.0 basis point

Yield Curve 127.0 +5.0 basis points

China Iron Ore Spot 171.85 USD/Metric Tonne +3.44%

Citi US Economic Surprise Index 85.0 +4.7 points

Citi Eurozone Economic Surprise Index 160.4 +6.0 points

Citi Emerging Markets Economic Surprise Index 62.7 +2.0 points

10-Year TIPS Spread 2.16 -2.0 basis points
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 -297 open in Japan
China A50 Futures: Indicating -158 open in China

DAX Futures: Indicating -45 open in Germany

Portfolio:

Lower: On losses in my energy/industrial/medical/biotech/tech sector longs

Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts

Market Exposure: Moved to 50% Net Long

Bear Radar

Posted by Gary .....at 1:55 PM

Style Underperformer:

Small-Cap Growth -3.1%

Sector Underperformers:

1) Alt Energy -5.5% 2) Homebuilding -5.5% 3) Semis -4.9%

Stocks Falling on Unusual Volume:

PLAB, BKNG, ADPT, FAF, FNF, RCL, MNRL, MGTA, PBFX, GTES, KURA, NCLH, HALO, SFTW, GPRE, GBOX, NVDA, TMDX, RTP, GH, DPZ, ACIC, PLTR, DMYI, UNVR, SBGI, ANSS, BBY, VAPO, TREE, TRIP, VVNT, PTVE, CLF, SPT, NTAP, TRTX, FRX, TDOC, GBT, HZO, PGNY, ACA, RDFN, PLAN, ESTC, PZZA, CARS, HSC, IIPR, HCC and PING

Stocks With Unusual Put Option Activity:

1) EMB 2) BK 3) KMX 4) RDFN 5) TDOC

Stocks With Most Negative News Mentions:

1) HCC 2) PING 3) EH 4) FUBO 5) GBT

Charts:

Bull Radar

Posted by Gary .....at 1:44 PM

Style Outperformer:

Large-Cap Value -1.6%

Sector Outperformers:

1) Retail +1.9% 2) Shipping +1.7% 3) Oil Service +1.1%

Stocks Rising on Unusual Volume:

CDXC, GME, OII, SEAS, AMC, PUBM, LMNX, RVLV, CCRN, WOW, PDCE, TWTR, FCN, TNDM, DFIN, MP, BCOR, PWR, SNBR, ERII, VIRT, RCII, ORGO, W, MAXR and WKHS

Stocks With Unusual Call Option Activity:

1) GEO 2) NCR 3) CXW 4) SOXS 5) UFS

Stocks With Most Positive News Mentions:

1) W 2) RVLV 3) NKE 4) TFX 5) STX

Charts:

Mid-Day Market Internals

Posted by Gary .....at 11:43 AM

NYSE Composite Index:

Volume Running +35.3% Above 100-Day Average
2 Sectors Rising, 9 Sectors Declining
26.7% of Issues Advancing, 71.1% Declining
267 New 52-Week Highs, 32 New Lows
83.0% of Issues Above 200-day Moving Average
Average 14-Day RSI 52.8%
Bloomberg Global Risk-On/Risk-Off Index 2,955.0 +140.0 points
Vix 23.4 +9.8%
Total Put/Call .61 -11.6%
TRIN/Arms .71 +10.9%

Wednesday, February 24, 2021

Thursday Watch

Posted by Gary .....at 9:48 PM