First Call - Hedge Fund Telemetry

S&P futures up 0.1% after US equities finished little changed in prior session. Asian equities mostly higher overnight. More volatility in China with Shanghai Composite up 1.8% after falling more than 1% on Tuesday. European markets mostly weaker. Treasuries bid yet little changed. Dollar slightly firmer vs yen and euro. NZD weakness the big story in FX today. (I'll have the chart on today's note - spoiler alert it's on day 12/13 with downside Sequential) Gold up 0.1%. WTI crude flat
Another very quiet session. No change in fundamental narrative. Path of least resistance for US equities has been higher on strong earnings and US economic growth outperformance. Buybacks and trade ware skepticism supportive as well. Also no meaningful fallout for broader market from recent rotation out of growth, which has already retraced half of the ground it lost to value in the three-day swoon in late July.
When I see upside/downside exhaustion signals happening together with many indexes it increases my conviction of a significant turn is ahead. In the coming days there will be many upside exhaustion signals. S&P 500 bullish sentiment is at 80%.

Trade still getting a lot of headlines. Not much new, though Reuters did discuss how the trade war with the US is causing a rift within Chinese leadership. Noted concerns Beijing’s hardline stance may be provoking US. China inflation data came in a bit hotter. Japan core machinery orders saw a much bigger than expected decline. RBNZ left rates unchanged, but policy statement was dovish. ECB bulletin highlighted some protectionist risk.
Yelp up big following beat and raise. Costco comps solid but ecommerce growth continued to slow trading a little lower. Booking.com rescheduled earnings and call to this morning -7% premarket. Dunn and Bradstreet going private +16% premarket. Rite Aid and Albertson’s scrapped merger agreement.

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