"Just one more thing."

- Lt Columbo

I just covered my Tesla  (TSLA)  trading short rental post EPS release at $389.37.

From earlier this evening:

Dougie Kass 1h ago

I took a small trading short rental in TSLA at $400.03 after the "mixed" EPS release...

Position: None

After-Hours % Advancers

After-Hours % Decliners

Closing Volume

- NYSE volume 10% below its one-month average

- NASDAQ volume 11% below its one-month average

- VIX index: down 2.97% to 18.92

Breadth

S&P 500 Sectors

% Movers

Nasdaq 100 Heat Map

Closing S&P 500 Heat Map

Thanks for reading my Diary today.

Congrats to everyone that held cannabis equities!

I have about a one-hour research call at 3:30 PM so I won't be chiming in again (save the closing data).

Enjoy the evening.

Be safe.

Avis Budget Group  (CAR)  traded in a range of $847 to $473 today — on volume of over 10 million shares..

Now at the day's lows.

Position: None

Weed rescheduled by...? Trading Odds & Predictions 2026 | Polymarket

I bought a small trading long rental in Netflix  (NFLX)  at $93.13.

This is a low confidence trade with a tight stop.

Position: Long NFLX (VS)

Here are today's things:

* Shorted  (SPY)  at $709.28 and  (QQQ)  at $650.96

* Sold out of my  (MSOS)  at $5.13.

* Eliminated the following individual cannabis equities:  (CURLF)  at $3.98, GLASF at $9.98,  (GTBIF)  at $8.51,  (TCNNF)  at $8.61, VRNO at $1.32 and TSNDF at $0.89

Position: Short SPY common (M), QQQ common (M)

I added to index shorts with S&P cash +62 handles:

*  (SPY)  $710.26

*  (QQQ)  $650.06

Position: Short SPY common (M), QQQ common (M) 

Viewing, as I have, cannabis stocks as trading sardines (as numerous secular challenges lie ahead as detailed often in my Diary), with day gains of between +15% to +35%, I am selling some of my individual cannabis positions on the rescheduling bump.

Position: None

I believe a meaningful correction will occur out of the blue:

* There will be no individual catalysts for the decline.

* The buying by traders/investors will have simply been satiated.

* There will be numerous narratives to explain the market drop in the business media — they will all be made up (as many are).

* I have no idea of the timing of a decline.

* I have no idea of the magnitude of the eventual decline.

Position: None

I am out of  (MSOS)  at $5.13 on the Axios report on rescheduling.

I still hold individual weed positions.

Position: None

More index shorts with S&P cash up by over +60 handles:

*  (SPY) $710.37

*  (QQQ)  $652.21

Position: Short SPY (M), QQQ (M)

At 10:28 AM:

Breadth

S&P 500 Sector ETFs 

% Movers

Banks abruptly move lower — it's the first sector to fade:

It might mean something, it might mean nothing.

Tech  (XLK)  vs. Financials  (XLF)  at 10:33 AM

From Peter Boockvar:

Dramamine now/Some good macro takes from MMM, TSCO, COF and UAL

Dramamine now, and I’m not just talking about the daily volatility around every news clip related to Iran and the Strait, watching the move higher in Avis (CAR) is quite extraordinary. It now makes up almost 20% of the DJIA Transportation Index and this index is more than 35% above its 200 day moving average, the widest since 1989 according to my old colleague Jonathan Krinksy, currently at BTIG.

From MMM and whose stock fell 2% yesterday:

“We had a light start to the year on the top line with organic growth of 1.2%, driven by pockets of macro pressure, but we saw encouraging order trends that support our outlook for acceleration in the balance of the year.”

“When you look across our portfolio, roughly 60% of our businesses showed relative strength in Q1, including General Industrial and Safety...At the same time, we experienced macro and industry driven softness in about 40% of the portfolio that we’ve been highlighting as watch areas.”

“Our performance in semiconductor and data centers was very strong, while consumer electronics was soft due to industry wide memory chip issues, which is impacting demand.”

“In automotive, the market was soft as expected in the first quarter. Global build rates were down 3% overall and 10% in China, which pressured volumes. And in Consumer, we continue to see soft US consumer discretionary spending with a few pockets of strength in categories with recent new product introductions.”

They are seeing rising costs in raw materials as to be expected. “So it’s ethlenes, propylenes, esters, acrylates, all those various things. And we are seeing some upward cost pressure on that. What we’ve seen so far and expect is about $125 million of cost increases there, which are offsetting into pricing...that we expect about a 50 basis point uplift on price coming from that oil based exposure.”

Tractor Supply traded down 12% yesterday and they said this:

“The retail environment remains cautious but stable, with spending focused on needs and small indulgences, with some evidence of trip consolidation.”

Specifically, “In Pet, the category remains pressured, and while we are holding our share, our performance is below our expectations...Dog ownership, particularly in larger breeds, has come under pressure, and our mix remains heavily weighted towards dog...Cat ownership is growing and gaining share, and that’s where we under index.”

“A good example of consumer spending is around their tax refund behavior. While refunds did come through and we captured our fair share, customers are using these dollars more cautiously. A significant portion is going towards essentials, savings and debt reduction rather than discretionary spending, consistent with the broader environment we’re seeing.”

About all of their comp gain was price, “average ticket increased 1.6%, reflecting a combination of inflation and category mix. Retail price inflation was the primary driver to the average ticket increase at approximately 150 bps contribution, along with a category mix benefit, principally from big ticket sales growth. This was partially offset by a modest decline in units per transaction.”

From Capital One that is trading down pre-market because of a rise in credit loss provisions:

“In our Domestic Card segment, the allowance balance was flat at $18.8 billion. Favorable observed credit in the quarter was offset by greater consideration to downside economic scenarios related to heightened geopolitical uncertainty.” Their card delinquency rate did slip by 29 bps q/o/q and by 55 bps y/o/y.

In their consumer banking area, “The allowance build was primarily driven by strong growth in the auto business, a slightly higher subprime mix in that growth, and a modestly lower outlook for vehicle values.” Auto delinquency rates fell too, lower by 72 bps y/o/y.

They also raised their allowance in commercial banking “primarily driven by a very small number of specific reserves in our real estate portfolio, as well as a modest increase in our criticized rate.”

On the state of their consumer, “So the US consumer remained healthy and the overall economy remained resilient through the first quarter. The unemployment rate improved slightly in the quarter. Despite some high profile headlines about layoffs, the total volume of job losses and new jobless claims remains low and stable. Income growth continue to run ahead of inflation. Consumer spending remained robust. Because of last year’s budget bill, tax withholdings are lower than a year ago and tax refunds are higher.”

“In our Domestic Card business, our credit metrics continue to improve on a y/o/y basis in the quarter. On a sequential quarter basis, our charge-off rate moved in line with seasonality, while our delinquencies improved relative to what we would expect from normal seasonality. Our auto credit metrics remained strong as well. Auto losses were slightly higher on a y/o/y basis in Q1, but this was consistent with a modest increase in the subprime mix of that portfolio over the past year. Our auto losses have been back near pre-pandemic levels for over a year. And our auto credit is supported by strong performance of recent originations and generally stable vehicle prices.”

“Of course, the new conflict in the Persian Gulf represents a significant cloud on the horizon. We’ve already seen energy prices spike sharply over the past six weeks. Inflation moved higher in March, largely because of the higher gas prices. So if energy prices remained elevated for an extended period of time, that would be a real headwind for consumers and probably a drag on the overall macroeconomy. But so far, we’ve not seen any adverse effects on our portfolio, either in our credit or in our spend metrics. We’ve judgmentally incorporated elevated macroeconomic risk into our allowance through qualitative factors. But we continue to really feel very good about not only our portfolio performance, but good for the credit outlook of consumers and good for the opportunity to continue to lean in to origination and credit line growth in our business.”

While lowering their full year guidance because of higher fuel costs, United Airlines is trading up after reporting and they said this in their earnings release ahead of their call today:

Their fuel bill went up by $340 million but “United’s capacity and revenue initiatives are intended to recapture this increase over the long term.”

“United’s diverse revenue streams remained resilient, including premium revenue up 14% compared to the first quarter of 2025, loyalty revenue up 13%, and revenue from basic economy up 75. Business revenue also remained strong at up 14% for the first quarter.”

To some economic data. With another dip in the average 30 yr mortgage rate to 6.35%, purchase applications jumped by 10% w/o/w while refi’s were up by 5.8%. We need to see a run of higher wage growth relative to home price growth to help on the affordability front.

Capturing the war, Japanese exports in March rose by 11.7%, about in line with the estimate of up 11%. Imports grew by 10.9%, higher than the forecast of up 7%. Helping trade was China reopening after their Lunar New Year holiday and likely too a rush to get stuff with growing worries of supply chain issues.

In the UK, March CPI was hot, up by .7% m/o/m and by 3.3% y/o/y vs 3% in the month before. Of course higher energy costs were the main factor with motor fuel jumping by 8.7%. The core rate though was still up by 3.1% y/o/y vs 3.2% in February. Services inflation remains persistent, up by 4.5% y/o/y vs 4.3% in February. All these stats were about as expected though and why the 10 yr UK inflation breakeven is unchanged at 3.41%. The 2 yr and 10 yr gilt yields are little changed too.

Wholesale prices were very hot, with input prices spiking by 4.4% in the month alone and by 5.4% y/o/y. Output charges were higher by .9% m/o/m and 2.6% y/o/y but I’m sure will catch up to the rise in costs.

Finally, Bank Indonesia left its benchmark rate unchanged at 4.75% as expected and their bias is up with rates. “Bank Indonesia is prepared to implement a further strengthening of monetary policy as needed to maintain the stability of the rupiah exchange rate and keep inflation in 2026 and 2027 within the target range.”

Knowledge@Wharton: A Blueprint for AI Agent Adoption 

More Index shorts:

*  (GRNY)  $26.44

*  (SPY)  $708.95

*  (QQQ)  $605.06

Position: Short GRNY (M) SPY (M), QQQ (M) 

I've moved to medium-sized short in the indices:

*  (SPY)  $708.34

*  (PSQ)  $649.08

Position: Short SPY (M) QQQ (M)

Upside:

-AGPU +145% (awarded $260M contract for NVIDIA GPU deployment)
-INBX +30% (Ozekibart shows updated colorectal cancer data; said to have received take over interest from Merck and others)
-POET +15% (momentum)
-TFX +9.4% (reportedly CVC and GTCR considers the purchase of Teleflex)
-GEV +7.6% (earnings, guidance)
-ASTS +6.9% (FCC has granted its application to modify its authorization to launch and operate its SpaceMobile non-geostationary orbit (NGSO) satellite system in low Earth orbit)
-KOPN +6.3% (awarded $3.2M initial order for an optical module supporting a partner's next-generation FPV goggle system for drone pilots with potential up to 40K units by end of 2028)
-MAS +6.3% (earnings, guidance)
-TWLO +5.3% (Tier1 firm Raised TWLO to Buy from Underperform, price target: $190 from $110)
-BA +3.8% (earnings, color)
-HOOD +3.6% (Robinhood Ventures invests $75M in OpenAI)
-UPST +3.6% (announces Multi-Year $1.2B Forward-Flow Agreement with Centerbridge Partners, L.P.)
-PM +3.5% (earnings, guidance)
-ADBE +3.1% (announces new $25B share buyback through April 30, 2030)
-BHP +2.6% (reports production)
-OTIS +2.0% (earnings, guidance)

Downside:
-CALX -8.3% (earnings, guidance)
-TEL -5.6% (earnings, guidance)
-VALN -5.3% (Goldman Sachs Cuts VLA.FR to Sell from Neutral, price target: €2.15)
-BBY -3.9% (Jason Bonfig to succeed Corie Barry as CEO)
-DRVN -3.8% (reports prelim revenue)
-NKTR -3.1% (prices ~3.53M shares at $92.00/share)
-CME -2.1% (earnings, color)

I'm back.

At 8:29 AM:

At 8 a.m.:

As discussed in "This Market Sees No Evil" earlier in the week, I remain cautious about the stock market's outlook.

I have been wrong footed, so have kept my short exposure low — out of respect for the extraordinary price momentum and the role of passive products and strategies in fueling the rally.

From JPMorgan

US: Futs are higher led by RTY. Futs recovered from yesterday’s risk-off moves as Trump announced ceasefire extension; he did not mention a specific deadline on this ceasefire deal and said it is until Iran submits a new proposal “and discussions are concluded.” Oil rallied overnight to $91; bond yields are largely unchanged; gold/silver rebounded from yesterday’s weakness. We will have another busy day with earnings: TSLA is expected to report after market-close today.

and...

JPM MARKET INTEL EQUITY & MACRO NARRATIVE

Yesterday, stocks closed lower but rebounded after the market close as Trump announced an extension of the ceasefire. We are in the middle of a busy earnings week with TSLA kicking off Mag 7 earnings today; see our earnings read-through below.

Not much surprise from Warsh’s hearing as the markets are waiting for signals whether Warsh can be confirmed before Powell’s term. Retail Sales surprised to the upside as higher tax refund offsets the rising gas prices; JPM Econ team tells us that “the first third of the month our Chase card data points to flat control retail sales, suggesting some slowdown in sales in the next report.”

· SOFTWARE STRENGTH YESTERDAY – JPM Software basket added +25bp today ahead of NOW earnings tomorrow, outperforming the broader market. Comments below came from JPM Trader Brian Heavey: “Still feels largely tactical to me given almost nobody really owns the sector [Software], but seems folks don't want to be caught short ahead of NOW earnings tomorrow night. Seems we are moving to "SAAS is dead" to "maybe they can co-exist" --> note our NOW checks this morning from M. Murphy showed that NOW partners view AI as a massive TAM expansion oppty. We ARE starting to see LO demand come back to the sector, but it's very spotty/minimal.”

· JAY BARRY ON WARSH’S HEARING YDAY – “The main event of the session was Warsh’s Senate Banking Committee hearing, with yields moving sharply higher as proceedings began. Warsh repeatedly stressed his respect for Fed independence, and stated that President Trump had never “generally or specifically instructed or suggested [Warsh] should commit to any interest rate path whatsoever.” Warsh also repeated his support for a smaller Fed balance sheet, though he acknowledged that any reduction in size would need to occur “slowly and deliberately,” with changes “described well in advance.” This aligns with our expectation that the Fed is likely to proceed cautiously and incrementally on balance sheet policy, prioritizing market functioning over speed to avoid disruptions to funding conditions, and that meaningful reforms are unlikely to occur over the near-term.”

Congress Has The Votes To Pass Federal Marijuana Reform, Top House Democrat Says - Marijuana Moment

A reminder:

I have oral surgery at 7:30 AM this morning.

I should be back near the open.

The S&P Short Range Oscillator remains overbought at 6.7% vs. 7.6%.

Position: Short SPY common (S)