Stocks Falling Substantially into Final Hour on China Bubble-Bursting Fears, Asian Currency Worries, Surging European/Emerging Markets/US High-Yield Debt Angst, Hombuilding/Transport Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Every Sector Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• Volatility(VIX) 23.59 +17.08%

• Euro/Yen Carry Return Index 139.64 -.92%

• Emerging Markets Currency Volatility(VXY) 12.22 +3.21%

• S&P 500 Implied Correlation 65.81 +3.36%

• ISE Sentiment Index 75.0 -46.81%

• Total Put/Call 1.21 +19.8%

• NYSE Arms 1.86 +85.56% 

Credit Investor Angst:

• North American Investment Grade CDS Index 83.15 +2.20%

• America Energy Sector High-Yield CDS Index 946.0 +2.62%

• European Financial Sector CDS Index 88.88 +4.64%

• Western Europe Sovereign Debt CDS Index 21.10 +4.12%

• Asia Pacific Sovereign Debt CDS Index 81.04 +5.97%

• Emerging Market CDS Index 364.43 +4.62%
  

• iBoxx Offshore RMB China Corporates High Yield Index 119.57 +.13%

• 2-Year Swap Spread 11.75 unch.

• TED Spread 31.50 -2.0 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -24.25 +1.75 basis points

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 70.72 -.85% 
• 3-Month T-Bill Yield -.01% +1.0 basis point

• Yield Curve 146.0 -3.0 basis points

• China Import Iron Ore Spot $56.21/Metric Tonne -1.90%

• Citi US Economic Surprise Index -28.3 -.6 point

• Citi Eurozone Economic Surprise Index 12.4 +.7 point

• Citi Emerging Markets Economic Surprise Index -21.6 +1.0 point

• 10-Year TIPS Spread 1.52 -4.0 basis points
• # of Months to 1st Fed Rate Hike(Morgan Stanley) 5.04 -.5

Overseas Futures:

• Nikkei 225 Futures: Indicating -455 open in Japan 
• China A50 Futures: Indicating -159 open in China

• DAX Futures: Indicating +28 open in Germany

Portfolio: 

• Slightly Higher: On gains in my index hedges and emerging markets shorts

• Disclosed Trades: None

• Market Exposure: 25% Net Long