First Call - Hedge Fund Telemetry

S&P futures down 0.5% after US equities finished mostly lower in prior session. Asian markets under pressure overnight. Japan down just over 1%, while China fell 2%. European markets also selling off. Treasuries firmer across the curve. Dollar lagging yen, but stronger vs euro and sterling. Gold off 0.3%. WTI crude extending recent pullback, down 0.7%.
Trade seems to be the go-to excuse for the global risk-off sentiment, despite the lack of anything particularly incremental. White House Wednesday afternoon confirmed multiple reports that it is considering 25% tariffs on $200B of Chinese imports, up from original 10% proposal. Yuan hit despite firmer fixing. Other trade headlines continue to look better, with US and Mexico meeting today.
Q2 earnings now over 72% done (362 S&P names have reported), and we’re tracking to one of the best quarters in recent history. 85% of names have beat on EPS estimates (by an average of 5%). 72% have beaten Revenue estimates
E-mini futures touching the lowest level in 3 weeks overnight, while the VIX is touching the highest level in nearly 4 weeks (granted, off a very low base).
Despite Brexit drama and recently soft macro, the Bank of England raised rates (expected) and said more hikes will be needed.
Tech was the big outperformer yesterday (+1% vs. the S&P -.10 bps). But Apple clearly skewed that (+5.9% with a 4% S&P weighting) while NDX and S&P Info Tech Index had negative breadth.

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