Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +4.0% Above 100-Day Average 
• 9 Sectors Rising, 2 Sectors Declining
• 62.1% of Issues Advancing, 33.0% Declining
• 160 New 52-Week Highs, 16 New Lows
• 87.5% of Issues Above 200-day Moving Average
• Average 14-Day RSI 51.3%
  
• Bloomberg Global Risk-On/Risk-Off Index 3,461.0 +124.0 points
• Vix 16.9 -2.8%
• Total Put/Call .63 -14.9%
• TRIN/Arms .72 +18.0%

Thursday Watch

Evening Headlines

Bloomberg:           

• Biden’s Top Man in Asia Says the Era of Engagement With China Is Over.
• Ditched Olympics Could Wipe Out Most of Japan’s Growth This Year.  
• Local Lockdowns Temper India’s Economic Activity in April.
  
• The Super Rich Are Choosing Singapore as the World’s Safest Haven.
• Bank CEOs Take Punches From Democrats, Warnings From Republicans.
• Exxon CEO Is Dealt Stinging Setback at Hands of New Activist.
• Shell Loses Climate Case That May Set Precedent for Big Oil.  
• Asia Stocks Eye Steady Start; Dollar, Yields Rise: Markets Wrap.
• Central Banks’ Slow Shift, Fed Taper, China Cost Impact: Eco Day.  
• From Corn to Copper, Commodities Cool Off With China in Focus. 
• Heat to Test Electric Grids From West Coast to New England.
• GameStop, AMC Shorts Get Hit With $673 Million Loss in Big Rally.
• Justice Department Opens Probe Into Archegos Blowup.

Wall Street Journal:

• Who Wants a Woke Bank?
• The Virus Lab Theory’s New Credibility. 
• Google, Hospital Chain to Make Tools Using Patient Data.

Fox News:

• Fauci doesn't believe Wuhan scientists made viruses more contagious.
  

CNBC.com:

• Nvidia revenue jumps 84% as gamers demand graphics chips.  
• FDA gives emergency use approval for Covid-19 antibody drug.
• American Eagle is the latest apparel retailer to crush estimates as teens head back to the mall.

MarketWatch.com:       

• Snowflake stock drops after losses double.

Zero Hedge:

• "Don't You Live In The Ghetto?" - Bill Gates Ignored Complaints About Top Money Manager's Racist, Sexist Behavior.
• "What The Hell Is Going On - 2020 Edition" - Chamath's Annual Letter Warns That "People Have Stopped Thinking For Themselves".
• Global Chip Hub Taiwan Hammered By Triple Blow Of Drought, Blackouts And COVID Surge.
• Illinois Constitutional Amendment Is "A Monstrous Giveaway To Public Unions".
• Re-Funding The Police: Major Cities Backtrack On Police Budget Cuts After Crime Surges.
• What To Expect In Tomorrow's "Monster" Momentum Quant Rebalance.
• Johns Hopkins Prof: Half Of Americans Have Natural Immunity; Dismissing It Is "Biggest Failure Of Medical Leadership".
• Suddenly The Market No Longer Sees Jackson Hole As Taper D-Day.
• "Change Is Coming" - Engine No. 1 Wins Two Exxon Board Seats.
• Small Caps Surge Amid Massive Short-Squeeze, Dollar Dead-Cat-Bounces.

Newsmax:

• White House Avoids Question on Possible Penalties for China in COVID-19 Origins Probe.  
• Trump: China 'Took Care of Hunter, Took Care of Joe'.  
• Rand Paul: Fauci Should Have to Testify on Wuhan Money.
  

TheGatewayPundit.com:

• “A Weaponized Operation” – General Flynn Blasts Biden Admin’s Efforts to Cover Up Origins of Covid (AUDIO).
• UPDATE: Biden Admin Shuts Down Trump’s Investigation into Origins of China Virus — Then Turns It Over to Crooked Intel Community and Asks China to Help.

The Epoch Times: 

• Senate Adopts GOP Amendment Banning US Funding of China’s Gain-of-Function Cell Research.

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 -.25% to +.25% on average.

• Asia Ex-Japan Investment Grade CDS Index 86.0 -.5 basis point.

• China Sovereign CDS 37.25 -.75 basis point.

• Bloomberg Emerging Markets Currency Index 61.22 -.02%.
• Bloomberg Global Risk-On/Risk Off Index 3,322.0 -14.0 points.
• Volatility Index(VIX) futures 19.75 +.65%.
• FTSE 100 futures -.02%.

• S&P 500 futures -.02%.

• NASDAQ 100 futures +.05%.

Morning Preview Links

Earnings of Note 
Company/Estimate 

 

Before the Open: 

• (AMWD)/1.71
• (PLAN)/-.09
• (BBY)/1.41
• (BURL)/.83
• (DG)/2.20
• (DLTR)/1.40
• (FRO)/-.06
• (GCO)/-.53
• (MDT)/1.42
• (SAFM)/2.50
• (TITN)/.16
• (TD)/1.76
  

After the Close:

• (ADSK)/.94
• (BOX)/.17
• (COST)/2.28
• (DELL)/1.62
• (GPS)/-.09
• (GES)/-.20
• (OLLI)/.62
• (CRM)/.89
• (ULTA)/1.96
• (VMW)/1.80
  

Economic Releases

8:30 am EST

• Durable Goods Orders for April is estimated to rise +.8% versus a +.8% gain in March.
• Durables Ex Transports for April is estimated to rise +.8% versus a +1.9% gain in March.
• Cap Goods Orders Non-Defense Ex-Air for April is estimated to rise +1.0% versus a +1.2% gain in March.
• Initial Jobless Claims for last week are estimated to fall to 425K versus 444K the prior week.
• Continuing Claims is estimated to fall to 3680K versus 3751K prior.
  

10:00 am EST

• Pending Home Sales MoM for April is estimated to rise +.5% versus a +1.9% gain in March.

11:00 am EST

• Kansas City Fed Manufacturing Activity for May is estimated to fall to 30 versus 31 in April.

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The House Hearing with major banks, weekly Langer Consumer Comfort Index, weekly EIA natural gas inventory report, $62B 7Y T-Note auction, German Consumer Sentiment report, (MRNA) science day and the (RJF) investor day could also impact global trading today.

US Equity Market Hours

• 9:30 am - 4:00 pm EST
  

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and consumer 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 Rising into Afternoon on Stable Long-Term Rates, Earnings Optimism, Oil Gain, Retail/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Around Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 18.3 -3.1%
• Bloomberg Global Risk On/Risk Off Index 3,281.0 +24.0 points

• Euro/Yen Carry Return Index 137.42 -.19%

• Emerging Markets Currency Volatility(VXY) 9.3 +.9%

• S&P 500 Implied Correlation 49.0 -3.5%

• ISE Sentiment Index 116.0  +18.0 points
  

• Total Put/Call .76 -7.3%

• NYSE Arms .64 -56.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 51.71 -.41%
  

• US Energy High-Yield OAS 439.08 -.42%

• European Financial Sector CDS Index 59.46 -.24%

• Italian/German 10Y Yld Spread 114.0 +1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 85.81 -.87%
  

• Emerging Market CDS Index 160.84 -.66%
  

• China Corp. High-Yield Bond USD ETF(KCCB) 39.21 +.03%

• 2-Year Swap Spread 8.0 -.5 basis point

• TED Spread 13.0 -1.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -1.5 +.25 basis point
  
• MBS  5/10 Treasury Spread  62.25 -.25 basis point
  
• IHS Markit CMBX BBB- 6 71.75 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 61.22 unch.
• 3-Month T-Bill Yield .01% unch.
  

• Yield Curve 143.0 -2.0 basis points
  

• China Iron Ore Spot 172.90 USD/Metric Tonne -8.7%

• Citi US Economic Surprise Index 3.8 -.2 point

• Citi Eurozone Economic Surprise Index 136.70 +.2 point
  

• Citi Emerging Markets Economic Surprise Index 53.3 -.1 point

• 10-Year TIPS Spread 2.43 -2.0 basis points
• 93.0% chance of no change at Sept. 22nd meeting, 93.0% chance of no change at Nov. 3rd meeting

Overseas Futures:

• Nikkei 225 Futures: Indicating -27 open in Japan 
• China A50 Futures: Indicating +82 open in China

• DAX Futures: Indicating -7 open in Germany

Portfolio:

• Higher: On gains in my biotech/commodity/industrial sector longs
  

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

• Market Exposure: Moved to 100% Net Long
  

Bear Radar

 Style Underperformer:

• Large-Cap Growth +.3%

Sector Underperformers:

• 1) Medical Equipment -1.0% 2) Paper -.9% 3) Gold & Silver -.4%

Stocks Falling on Unusual Volume: 

• WBA, BLL, PCRX, CCK, JWN, PACK and TVTX
  

Stocks With Unusual Put Option Activity:

• 1) IVR 2) DKS 3) ZS 4) WBA 5) AMC
  

Stocks With Most Negative News Mentions:

• 1) TVTX 2) GOTU 3) BSX 4) CALM 5) RAD
  

Charts:

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

Bull Radar

Style Outperformer:

• Small-Cap Value +2.0%

Sector Outperformers:

• 1) Alt Energy +4.1% 2) Retail +2.8% 3) Airlines +2.7%

Stocks Rising on Unusual Volume:

• OMI, AMC, SKY, DKS, RRGB, GME, URBN, ZS, BGFV, FOSL, BBBY, QS, RIOT, RVNC, ANF, PTON, IDCC, F, ASO, INVA, SPCE, CVET, BYND, AFRM, ONTF, TTCF, BKE, MUDS, DY, TOL, ETH, ICPT, GIII, LUNG, CRSR and CTRN
  

Stocks With Unusual Call Option Activity:

• 1) PIRS 2) DKS 3) EXPR 4) JWN 5) GES

Stocks With Most Positive News Mentions:

• 1) BBW 2) DKS 3) LI 4) URBN 5) ZS
  

Charts:

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

Morning Market Internals

NYSE Composite Index:

• Volume Running -3.0% Below 100-Day Average 
• 7 Sectors Rising, 4 Sectors Declining
• 63.5% of Issues Advancing, 32.4% Declining
• 87 New 52-Week Highs, 13 New Lows
• 86.8% of Issues Above 200-day Moving Average
• Average 14-Day RSI 49.9%
  
• Bloomberg Global Risk-On/Risk-Off Index 3,245.0 -8.0 points
• Vix 18.3 -2.8%
• Total Put/Call .65 -20.7%
• TRIN/Arms .72 -51.0%