Stocks Slightly Higher into Final Hour on Debt Ceiling Hopes, Short-Covering, Retail/Homebuilding Sector Strength

Broad Market Tone:

• Advance/Decline Line: About Even
  

• Sector Performance: Mixed
  

• Volume: Below Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• VIX 13.43 -.67%

• ISE Sentiment Index 89.0 -16.82%

• Total Put/Call 1.05 +31.25%

• NYSE Arms .70 -42.26%

Credit Investor Angst:

• North American Investment Grade CDS Index 88.80 -.85%

• European Financial Sector CDS Index 134.33 +2.15%

• Western Europe Sovereign Debt CDS Index 100.0 +1.11%

• Emerging Market CDS Index 212.72 -1.25%

• 2-Year Swap Spread 12.75 -.5 bp

• TED Spread 22.25 -1.5 bps

• 3-Month EUR/USD Cross-Currency Basis Swap -17.75 -.75 bp

Economic Gauges:

• 3-Month T-Bill Yield .08% +2 bps

• Yield Curve 159.0 -3 bps

• China Import Iron Ore Spot $152.90/Metric Tonne -1.10%

• Citi US Economic Surprise Index 7.90 -1.0 point

• 10-Year TIPS Spread 2.53 unch.

Overseas Futures:

• Nikkei Futures: Indicating +19 open in Japan

• DAX Futures: Indicating +18 open in Germany

Portfolio:

• Slightly Higher: On gains in my biotech/retail sector longs and emerging markets shorts

• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 50% Net Long