North American Investment Grade CDS Index 101.77 bps +1.69%
European Financial Sector CDS Index 99.0 bps +4.15%
Western Europe Sovereign Debt CDS Index 116.33 bps +3.33%
Emerging Market CDS Index 208.81 bps +.46%
2-Year Swap Spread 18.0 unch.
TED Spread 28.0 unch.
Economic Gauges:
3-Month T-Bill Yield .14% unch.
Yield Curve 237.0 -2 bps
China Import Iron Ore Spot $143.60/Metric Tonne +1.56%
Citi US Economic Surprise Index -31.60 -1.2 points
10-Year TIPS Spread 1.84% unch.
Overseas Futures:
Nikkei Futures: Indicating -48 open in Japan
DAX Futures: Indicating +23 open in Germany
Portfolio:
Higher: On gains in my Retail, Technology and Medical long positions
Disclosed Trades: None
Market Exposure: 100% Net Long
BOTTOM LINE: Today's overall market action is neutral as the S&P 500 trades near session highs, despite more weak economic data and recent stock gains. On the positive side, Retail, Telecom, Ag, Oil Service, Alt Energy stocks are especially strong, rising .50%+. The S&P GSCI Ag Spot Index is surging another +2.58% and is up +32.6% from its June 7th low. The AAII % Bulls fell to 30.4% this week, while the % Bears rose to 38.2, which is another positive. On the negative side, Education and Disk Drive shares are under pressure, falling 1.5%+. The European Investment Grade CDS Index is rising +4.2% to 98.08 bps. Reports that equity-focused hedge funds finished July just slightly higher, while the S&P 500 rose 7%, lead me to believe that many managers will feel great pressure to increase market exposure on any further push higher in the major averages. Agriculture plays have strongly outperformed of late on the recent rise in grain prices and I expect this trend to continue awhile longer. Tomorrow's jobs report will likely be disappointing, however I suspect stocks will recover in the afternoon from any morning weakness. 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 bargain-hunting.
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