Research Insight: This morning we drill down on the latest short interest data that was published yesterday morning. Short selling can impact the movement of stocks especially Mid and Small Cap stocks. Our friends at Erlanger Research do in depth research on short interest for the past twenty seven years. The Erlanger Commitment of Short Sellers (ECOS) continues to rise with 17  of 24 sectors seeing Dumb Short Sellers in control over Smart Short Sellers. This sets up for an interesting situation which Erlanger detailed yesterday. Read on and if you have questions reach out to your CAPIS salesperson.

Corporate Actions

IPOs on deck for This Week:  Another busy one for IPOs with 9 on deck.

IPOs on deck for Today:  CHNG ADPT MORF BBIO

Secondaries on deck for Today: INXN GMDA RMR

Notes Priced: 

Common Stock filings: MOTS BJ ZYXI

Mixed Shelf Offerings filed: 

Convertible Offering Files: QD

Courtesy of IPO Financial

Earnings After The Close:

Beat: KBH +0.13, MLHR +0.10 

Flat: WOR 

Missed: PDCO (0.09), FUL (0.01)

News After The Close:

FAA finds another potential risk on the Boeing (BA) 737 Max. Will delay return to flight.

Yum! Brands (YUM) names Chris Turner CFO as of August 8th, 2019.

Dividend Increase: MLHR

What’s Happening This Morning: Futures were up +13 on the S&P when President Xi Proposal came out and then Boeing news from yesterday hit the Dow. Interesting morning.

U.S. futures: S&P +3.25, Dow Jones -31, NDX +14.75  and Russell 2000 +2.10 with fair values MIXED.  Asia  and Europe mostly higher click through for details by country.

Gold and silver lower with copper higher. WTI Crude Oil and Brent Oil Futures lower. Natural Gas is higher. $ is higher vs Euro, lower vs. Pound and higher vs. Yen. US 10 year Treasury price $127.52 from $127.86 with yields higher since Wednesday morning with the yield at 2.06% from 2.02%. Prices as of 6:25 a.m. EDT.

Top Sectors Wednesday:  Materials, Conglomerates and Technology.

Weakest Sectors Wednesday: Utilities and Healthcare.

One Month Winners: Healthcare, Industrials and Materials.

Three Month Winners:  Industrials, Services, Financials and Consumer Goods.

Six Month Winners: Conglomerates, Industrials, Services and Techology.

Twelve Month Winners: Utilities, Healthcare, Industrials and Services.

Year to Date: All higher led by Conglomerates, Services, Industrials, Technology and Consumer Goods.

Hourly Action This  Week:

This week we  have seen selling in 6 hours. A pretty bad start to the week. Should improve from here.

Courtesy of Quantitative Partners, Inc.

Upcoming Earnings Of Note (sorted by market cap, highest to lowest)

Today After The Close:  NKE PRGS SGH CAMP.

Thursday Before The Open:  STZ JKS GBX.

Earnings This Morning Of Note 

Beat: MKC +0.08, APOG +0.05, CAN +0.04, WBA +0.04 

Flat: None of note.

Missed: GMS (0.05), CAG (0.05)

Missing This Morning: JEF, SJR

 Rags & Mags: Highlighted Stories may be clicked through to the original story.

Top News Story:  Chinese President Xi to present  the U.S. with settlement terms. (WSJ)

Five Things You Need To Know To Start Your Day  (Bloomberg)

Review of the Democratic debate last night. (CNBC)

Democratic debate shows split in the Democratic Party. (Bloomberg)

Bitcoin down $1500 this morning.

Data Points

All indexes are giving up some ground.

Bold means a change from prior day.

The advance/decline line has improved dramatically and moved to a buy on 6/13.

The QPI10 Day Moving Average of Breadth (10DMA) is no longer in cash and moved to invested on .

Courtesy of Quantitative Partners, Inc.

YTD  69% (-1% week over week) of stocks are higher and 31% are lower. Updated 6/21/19 close with next update on 6/28/19 close.

Courtesy of Phil Erlanger Research, Inc.

Algo/HFT Trading Levels:

The Erlanger Value Lines track the intraday range of resistance, pivot and support used by Algo/HFT Traders. Each day we show where we closed within the range. Yesterday was the first day in June where all indexes closed below support.

Courtesy of Phil Erlanger Research

The Value Lines may be accessed via Bloomberg. For a free trial if you are a Bloomberg user go to APPS CS:ERLA

Economic & Related:

Weekly Jobless Claims due out at 8:30 a.m. EDT.

Q1 GDP Third Estimate is due out at 8:30 a.m. EDT and is expected to remain at 3.1%.

May Pending Home Sales are due out at 10:00 a.m. EDT and expected to rise to 1.0% from -1.5%.

Weekly Natural Gas Inventories are due out at 10:30 a.m. EDT.

$32 Billion of 7 Year Notes auctioned at 1:30 p.m. EDT.

Geopolitical:

President Trump arrived in Osaka, Japan for the G-20 and begins 8 bilateral meetings over the next couple of days.

The Democratic Party concludes two days of nightly debates with front runners Former VP Joe Biden and Senator Bernie Sanders.

Conferences & Analyst Meetings:  

Analyst Meetings/Notable Conference Call:   OVID (investor or analyst day) EV OFG ITRI(conference call).

Sellside Conferences:  Wells Fargo Securities “Bricks To Clicks” Digital Conference. BMO Chemicals & Materials Conference. UBS Taiwan Conference.

Industry Conferences:  Mobile World Congress Shanghai (through 6/28). Bitcoin 2019 Conference ( through 6/26). 

M&A Activity

OFG Bancorp (OFG) to buy Scotiabank’s (BNS) Puerto Rico operation for $550 million.

Upgrades & Downgrades

Early Morning Gap Up/Down:

Gap Higher: MLHR +13%, VRCA +11%, MGI +10%, OFG +9%, KBH +6%

Gap Lower: ACRS -33%, MOTS -13%, RAD -10%, ZYXI -7%, FUL -6%, OSTK -4%