North American Investment Grade CDS Index 100.08 bps -.15%
European Financial Sector CDS Index 95.0 bps +3.77%
Western Europe Sovereign Debt CDS Index 112.66 bps +2.11%
Emerging Market CDS Index 207.98 bps -.27%
2-Year Swap Spread 18.0 +2 bps
TED Spread 228.0 -2 bps
Economic Gauges:
3-Month T-Bill Yield .14% unch.
Yield Curve 239.0 +2 bps
China Import Iron Ore Spot $141.40/Metric Tonne -.98%
Citi US Economic Surprise Index -30.40 +3.4 points
10-Year TIPS Spread 1.84% +1 bp
Overseas Futures:
Nikkei Futures: Indicating +146 open in Japan
DAX Futures: Indicating +14 open in Germany
Portfolio:
Higher: On gains in my Biotech, Retail, Technology and Medical long positions
Disclosed Trades: None
Market Exposure: 100% Net Long
BOTTOM LINE: Today's overall market action is bullish as the S&P 500 trades near session highs, despite euro weakness and recent gains. On the positive side, Internet, Hospital, HMO, I-Banking, Steel, Gold and Coal stocks are especially strong, rising 2.0%+. Cyclicals and small-caps are outperforming. The TED spread is falling to the lowest level since May 13th, which is a major positive. The UK sovereign cds is falling another -1.88% to 54.44 bps. The S&P GSCI Ag Spot Index is surging another +3.15% and copper continues to trade well, rising +1.34%. The 10-year yield is at session highs, rising +5 bps to 2.96%. On the negative side, Airline and Tobacco shares are under pressure, falling 1.0%+. Banks and homebuilders aren't participating in today's rally. The China sovereign cds is rising +3.49% to 80.20 bps. Gold is rising for the sixth straight day, which is also a negative. The S&P 500 looks poised to test the 1,150 level over the coming weeks. A convincing break above this level would likely lead to a significant increase in investment manager performance angst, which could spur further buying. I expect US stocks to trade mixed-to-higher into the close from current levels on short-covering, technical buying, mostly positive earnings reports and less economic fear.
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