North American Investment Grade CDS Index 110.62 bps +1.94%
European Financial Sector CDS Index 119.22 bps +4.04%
Western Europe Sovereign Debt CDS Index 136.33 bps +1.0%
Emerging Market CDS Index 226.08 bps +2.45%
2-Year Swap Spread 19.0 +2 bps
TED Spread 23.0 -1 bp
Economic Gauges:
3-Month T-Bill Yield .14% unch.
Yield Curve 219.0 +1 bp
China Import Iron Ore Spot $148.30/Metric Tonne +.47%
Citi US Economic Surprise Index -56.1 -1.1 points
10-Year TIPS Spread 1.68% -8 bps
Overseas Futures:
Nikkei Futures: Indicating -17 open in Japan
DAX Futures: Indicating +8 open in Germany
Portfolio:
Higher: On gains in my Biotech and Ag long positions
Disclosed Trades: Covered some of my (IWM)/(QQQQ) hedges and then added them back
Market Exposure: 50% Net Long
BOTTOM LINE: Today's overall market action is just mildly bearish as the S&P 500 is trading near session highs despite more disappointing economic data, a weaker euro and tech sector worries. On the positive side, Airline, Gaming, Drug, Biotech, Telecom, Paper, Gold, Ag, Oil Tanker and Coal stocks are especially strong, rising .75%+. Despite today's disappointing jobs data, the 10-year yield is rising +6 bps to session highs and copper is rising +.8%. Moreover, the S&P GSCI Ag Spot Index is jumping another +3.02%. The Spain sovereign cds is falling -5.46% to 200.95 bps. On the negative side, Networking, Disk Drive, Computer and Internet shares are especially weak, falling 2.25%+. (IYR) has also underperformed throughout the day. The ongoing rise in eurozone credit default swaps is a major negative. Moreover, the action in the tech sector is very poor. I will closely monitor the bond market's reaction to tomorrow's likely weaker-than-expected consumer confidence reading before further shifting market exposure. I expect US stocks to trade mixed-to-lower into the close from current levels on more shorting, tech sector concerns, rising economic fear and China worries.
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