Stocks Sharply Lower into Final Hour on Financial Sector Concerns, Global Growth Worries

BOTTOM LINE: The Portfolio is lower into the final hour on losses in my Computer longs, Gaming longs and Software longs. I added (QQQQ)/(IWM) hedges and added to my (EEM) short today, thus leaving the Portfolio 75% net long. The tone of the market is negative as the advance/decline line is lower, most sectors are declining and volume is about average. Investor anxiety is above-average. Today’s overall market action is very bearish. The VIX is rising 5.8% and is above-average at 24.49. The ISE Sentiment Index is below average at 118.0 and the total put/call is above average at .97. Finally, the NYSE Arms has been running very high most of the day and is currently 1.84. The Euro Financial Sector Credit Default Swap Index is falling 8.0% today to 87.67 basis points, which is a big positive. This index is up from a low of 52.66 on May 5^th, but down from 129.46 basis points on March 20^th. The North American Investment Grade Credit Default Swap Index is rising .52% today to 141.21. The TED spread is rising 3.49% to .97. One of the few positives today is oil's inability to rally, notwithstanding a weaker dollar, an Iranian missile test, recent losses and a large crude inventory drawdown. Nikkei futures indicate an +73 open in Japan and DAX futures indicate a -22 open in Germany tomorrow. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering and bargain-hunting.