EB Watch List Update Report

Dear Members: MARKET UPDATE I've realized that I have become more bearish of late which seems to go against market action. A number of companies have beaten earnings expectations, including some blue chip stocks this morning, resulting in all of the major indexes moving higher. On the other hand, Alphabet (GOOGL) reported earnings after the bell last night that disappointed traders with the stock down over 3%. In spite of GOOGL's disappointing showing, the NASDAQ so far has shaken it off. But I want to point a few things out and the reason I've moved into caution mode. First, look at the VIX; it came within a whisker of dipping below 9 for the first time in history which goes back almost 30 years. In other words, since 1989, market confidence has never been higher. This may well excite the bulls but to me it has become a major warning signal. Simply put, the market is priced for perfection plus; there is ZERO margin for surprise. In looking at the Dow it came close to matching its recent all time high but so far has fallen short. This in spite of very strong earnings from Caterpillar, McDonald's and General Motors. The S&P has hit an all time high, but not by much. Some of the strong gains have been pegged to low rates and a softened dollar. But now the $USD is oversold; we could see a bounce sometime soon. We may well see some rotation here with more interest in blue chips as tech stocks need a breather. Some technicians will point to the extremely low VIX as very bullish, which I understand. But the market has a way of spoiling the party when it is least expected, especially when something is overdone, both on the upside and downside. Getting back to the Dow. It almost got to 21,200 back on March 1. Almost five months later it is just over 400 points higher. That's not much. The S&P has moved up by 25 points in the past month. The NASDAQ is up less than 1% the past two months. In other words, the market hasn't really made much progress in spite of improving earnings. So when I add it all up, and especially when I see the VIX at its lowest level EVER, I can't get excited. So I'm going to continue to remain conservative here. It may seem boring but I just can't see chasing anything here and would like to at least see a decent pullback before putting capital to work, even if the market goes a bit higher. KEY EARNINGS REPORTS Companies reporting earnings today (July 25) include: Before Market Opens: MMM, AKS, BIIB, CAT, CIT, DPZ, DD, EXAS, GM, JBLU, KMB, LLY, MCD, NEM, PCAR, PHM, DGX, STX, TROW, TRU and UTX After Market Close: AKAM, AMP, AMGN, T, CSL, CMG, CB, CLGX, DLB, EEFT, ESRX, JNPR, MORN, RHI, TXN, X, WYNN and ZION Companies reporting earnings tomorrow (July 26) include: Before Market Opens: ALK, ANTM, BAX, BA, BCO, KO, GLW, DHI, DTE, FLIR, F, GD, GSX, HSY, HES, HLT, IR, LEA, NDAQ, NSC, NOC, OC, ROK, R, SLAB, SIX, SYT, and TUP After Market Closes: ABX, BWLD, DFS, DRE, EFX, ETH, FFIV, FB, FORR, GILD, GC, HST, IMAX, KNX, KN, LRCX, LVS, LM, NTGR, NTRI, ORLY, PYPL, PSA, RJF, RGC, RCII, SU, TER, TSCO, VRTX, WM, WHR, WFM and XLNX ADDITIONS TO WATCH LISTS: No additions to Watch List at this time. Going to remain patient for now. BRIEF COMMENTS ON SELECT WATCH LIST STOCKS: SHORTS: None at this time LONGS: Large Cap Watch List None at this time Mid Cap Watch List None at this time Small Cap Watch List None at this time DELETIONS FROM THE WATCH LIST None at this time At your service, John Hopkins EarningsBeats