Friday, July 30, 2021

Stocks Lower into Final Hour on Global Virus Shutdown/Mandate Worries, China Economic Crackdown Fears, Dollar Strength, Commodity/Airlines Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Lower
  • Sector Performance: Mixed
  • Volume: Below Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 18.0 +1.7%
  • Bloomberg Global Risk On/Risk Off Index 2,647.0 -107.0 points
  • Euro/Yen Carry Return Index 134.47 +.07%
  • Emerging Markets Currency Volatility(VXY) 8.5 -.2%
  • S&P 500 Implied Correlation 52.5 +4.4%
  • ISE Sentiment Index 95.0  -20.0 points
  • Total Put/Call .76 +!3.4%
  • NYSE Arms 1.6 +68.0%
Credit Investor Angst:
  • North American Investment Grade CDS Index 49.24 +1.1%
  • US Energy High-Yield OAS 424.38 +.8%
  • European Financial Sector CDS Index 54.23 +.69%
  • Italian/German 10Y Yld Spread 108.0 unch.
  • Asia Ex-Japan Investment Grade CDS Index 91.1 +.5%
  • Emerging Market CDS Index 163.83 +1.5%
  • China Corp. High-Yield Bond USD ETF(KCCB) 37.8 -.45%
  • 2-Year Swap Spread 7.75 unch.
  • TED Spread 8.5 -.25 basis point
  • 3-Month EUR/USD Cross-Currency Basis Swap -4.75 -.25 basis point
  • MBS  5/10 Treasury Spread  72.5 +2.5 basis points
  • IHS Markit CMBX BBB- 6 73.75 +.25 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 60.06 -.37%
  • 3-Month T-Bill Yield .04% unch.
  • Yield Curve 105.0 +1.0 basis point
  • China Iron Ore Spot 176.80 USD/Metric Tonne -7.1%
  • Citi US Economic Surprise Index -13.8 +5.2 points
  • Citi Eurozone Economic Surprise Index 40.4 -5.0 points
  • Citi Emerging Markets Economic Surprise Index 49.3 -.3 point
  • 10-Year TIPS Spread 2.40 -2.0 basis points
  • 100.0% chance of no change at Nov. 3rd meeting, 100.0% chance of no change at Dec. 15th meeting
US Covid-19:
  • 144 infections/100K people(last 7 days) +7/100K people
  • 27% of Jan. 7th, 2021 peak(highest daily avg. new infections) +1.0 percentage point
Overseas Futures:
  • Nikkei 225 Futures: Indicating +230 open in Japan 
  • China A50 Futures: Indicating -51 open in China
  • DAX Futures: Indicating -7 open in Germany
Portfolio:
  • Slightly Higher: On gains in my tech/medical sector longs, index hedges and emerging market shorts
  • Disclosed Trades: None
  • Market Exposure: 75% Net Long

Bear Radar

 Style Underperformer:

  • Large-Cap Growth -.5%
Sector Underperformers:
  • 1) Oil Service -3.1% 2) Airlines -2.5% 3) Internet -1.9%
Stocks Falling on Unusual Volume: 
  • CAKE, VFC, KMPR, TXRH, MGI, AMZN, ATR, SWKS, EHTH, NWL, W, VNDA, UPWK, ZEN, ZYXI, ANVS, PINS, TBIO and SAVA
Stocks With Unusual Put Option Activity:
  • 1) ATOS 2) SIX 3) JWN 4) SWKS 5) DRI
Stocks With Most Negative News Mentions:
  • 1) PENS 2) ZEN 3) ROG 4) AMZN 5) EBAY
Charts:

Bull Radar

Style Outperformer:
  • Mid-Cap Value -.1%
Sector Outperformers:
  • 1) Disk Drives +1.9% 2) Medical Equipment +1.1% 3) Digital Health +.8%
Stocks Rising on Unusual Volume:
  • SILK, POWI, DXCM, VCYT, GDYN, MITK, KLAC, DSP, CLPT, RDNT, MMSI, JBI, XM, FTV, CHTR, ASIX, SGEN, MAXR, ICHR, INT, HLMN, CODX, GOGO, AMD, EBS, FSLR and TNDM
Stocks With Unusual Call Option Activity:
  • 1) HP 2) TXRH 3) FOXA 4) TOL 5) FTNT
Stocks With Most Positive News Mentions:
  • 1) TEAM 2) SIMO 3) DXCM 4) CPRI 5) MSON

Morning Market Internals

NYSE Composite Index:
  • Volume Running -12.2% Below 100-Day Average 
  • 6 Sectors Rising, 5 Sector Declining
  • 43.7% of Issues Advancing, 51.4% Declining
  • 129 New 52-Week Highs, 19 New Lows
  • 78.4% of Issues Above 200-day Moving Average
  • Average 14-Day RSI 49.4%
  • Bloomberg Global Risk-On/Risk-Off Index 2,625.0 -128.0 points
  • Russell 1000: Growth/Value 17,494 -.64%
  • Vix 18.1 +2.3%
  • Total Put/Call .73 +9.0%
  • TRIN/Arms 1.30 +34.0%

Thursday, July 29, 2021

Friday Watch

Evening Headlines

Bloomberg:      
Wall Street Journal:
Fox News:
Zero Hedge:
Newsmax:
TheGatewayPundit.com:
The Epoch Times:  
Night Trading 
  • Asian equity indices are -.75% to -.25% on average.
  • Asia Ex-Japan Investment Grade CDS Index 89.0 -.75 basis point.
  • China Sovereign CDS 39.0 -1.0 basis point.
  • Bloomberg Emerging Markets Currency Index 60.27 -.01%.
  • Bloomberg Global Risk-On/Risk Off Index 2,655.0 -99.0 points.
  • Volatility Index(VIX) futures 20.6 +4.3%.
  • FTSE 100 futures -.51%.
  • S&P 500 futures -.61%.
  • NASDAQ 100 futures -1.14%. 
Morning Preview Links

Earnings of Note 
Company/Estimate 
 
Before the Open: 
  • (ABBV)/3.03
  • (AXL)/.03
  • (AON)/1.85
  • (B)/.44
  • (BLMN)/.68
  • (BAH)/.97
  • (CRI)/.79
  • (CAT)/2.41
  • (CBOE)/1.36
  • (CERN)/.75
  • (CHTR)/4.99
  • (CVX)/1.60
  • (CL)/.80
  • (DISH)/.86
  • (XOM)/.98
  • (IDXX)/2.04
  • (ITW)/2.09
  • (JCI)/.83
  • (LHX)/3.18 
  • (LYB)/5.62
  • (NWL)/.45
  • (PG)/1.08
  • (VFC)/.11
  • (WY)1.39
After the Close:
  • None of note
Economic Releases
8:30 am EST
  • Employment Cost Index for 2Q is estimated to rise +.9% versus a +.9% gain in 1Q.
  • Personal Income for June is estimated to fall -.3% versus a -2.0% decline in May.
  • Personal Spending for June is estimated to rise +.7% versus unch. in May.
  • The PCE Core MoM for June is estimated to rise +.6% versus a +.5% gain in May.
9:45 am EST
  • The MNI Chicago PMI for July is estimated to fall to 64.1 versus 66.1 in June.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Japan Housing Data report could also impact global trading today.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST
BOTTOM LINE: Asian indices are modestly lower, weighed down by healthcare and technology shares in the region. I expect US stocks to open modestly lower and to rally into the afternoon, finishing mixed. The Portfolio is 75% net long heading into the day.

Stocks Higher into Final Hour on Earnings Optimism, Dollar Weakness, Oil Gain, Commodity/Homebuilding Sector Strength

Broad Equity Market Tone:
  • Advance/Decline Line: Higher
  • Sector Performance: Almost Every Sector Rising
  • Volume: Around Average
  • Market Leading Stocks: Outperforming
Equity Investor Angst:
  • Volatility(VIX) 17.4 -4.8%
  • Bloomberg Global Risk On/Risk Off Index 2,800.0 +159.0 points
  • Euro/Yen Carry Return Index 134.44 +.02%
  • Emerging Markets Currency Volatility(VXY) 8.6 -1.3%
  • S&P 500 Implied Correlation 50.8 -.9%
  • ISE Sentiment Index 115.0  -14.0 points
  • Total Put/Call .63 -19.2%
  • NYSE Arms 1.02 +37.8%
Credit Investor Angst:
  • North American Investment Grade CDS Index 48.45 -1.3%
  • US Energy High-Yield OAS 422.44 -.98%
  • European Financial Sector CDS Index 53.86 -.64%
  • Italian/German 10Y Yld Spread 108.0 +1.0 basis point
  • Asia Ex-Japan Investment Grade CDS Index 90.5 -2.0%
  • Emerging Market CDS Index 161.35 -3.0%
  • China Corp. High-Yield Bond USD ETF(KCCB) 38.0 -.35%
  • 2-Year Swap Spread 7.75 unch.
  • TED Spread 8.75 unch.
  • 3-Month EUR/USD Cross-Currency Basis Swap -4.5 -.5 basis point
  • MBS  5/10 Treasury Spread  70.0 -2.0 basis points
  • IHS Markit CMBX BBB- 6 73.5 unch.
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 60.29 +.62%
  • 3-Month T-Bill Yield .04% unch.
  • Yield Curve 104.0 unch.
  • China Iron Ore Spot 189.0 USD/Metric Tonne -2.4%
  • Citi US Economic Surprise Index -19.0 -22.2 points
  • Citi Eurozone Economic Surprise Index 45.4 +4.7 points
  • Citi Emerging Markets Economic Surprise Index 49.6 -1.2 points
  • 10-Year TIPS Spread 2.42 +4.0 basis points
  • 100.0% chance of no change at Nov. 3rd meeting, 100.0% chance of no change at Dec. 15th meeting
US Covid-19:
  • 137 infections/100K people(last 7 days) +7/100K people
  • 26% of Jan. 7th, 2021 peak(highest daily avg. new infections) +1.0 percentage point
Overseas Futures:
  • Nikkei 225 Futures: Indicating +41 open in Japan 
  • China A50 Futures: Indicating -124 open in China
  • DAX Futures: Indicating -19 open in Germany
Portfolio:
  • Higher: On gains in my industrial/tech/consumer discretionary/medical sector longs
  • Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 100% Net Long