Thursday, May 19, 2016

Stocks Falling into Final Hour on Fed Rate-Hike Fears, Rising European/Emerging Markets/US High-Yield Debt Angst, Emerging Market Currency Worries, Financial/Biotech Sector Weakness

Broad Equity Market Tone:
  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Almost Every Sector Declining
  • Volume: Around Average
  • Market Leading Stocks: Underperforming
Equity Investor Angst:
  • Volatility(VIX) 16.7 +4.7%
  • Euro/Yen Carry Return Index 128.66 -.39%
  • Emerging Markets Currency Volatility(VXY) 11.12 +2.02%
  • S&P 500 Implied Correlation 56.69 +1.18%
  • ISE Sentiment Index 60.0 -24.0%
  • Total Put/Call 1.37 +35.64%
  • NYSE Arms .70 -30.6% 
Credit Investor Angst:
  • North American Investment Grade CDS Index 84.96 +1.26%
  • America Energy Sector High-Yield CDS Index 970.0 +.21%
  • European Financial Sector CDS Index 100.76 +1.39%
  • Western Europe Sovereign Debt CDS Index 25.95 +.19%
  • Asia Pacific Sovereign Debt CDS Index 55.48 +2.35%
  • Emerging Market CDS Index 309.17 +2.34%
  • iBoxx Offshore RMB China Corporate High Yield Index 128.10 +.06%
  • 2-Year Swap Spread 13.50 +1.5 basis point
  • TED Spread 33.0 -.5 basis point
  • 3-Month EUR/USD Cross-Currency Basis Swap -26.75 -.25 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 70.57 -.47%
  • 3-Month T-Bill Yield .30% unch.
  • Yield Curve 96.0 -2.0 basis points
  • China Import Iron Ore Spot $53.47/Metric Tonne -5.83%
  • Citi US Economic Surprise Index -30.60 +1.1 points
  • Citi Eurozone Economic Surprise Index -1.4 +1.6 points
  • Citi Emerging Markets Economic Surprise Index -1.9 +.7 point
  • 10-Year TIPS Spread 1.61% -4.0 basis points
  • 46.7% chance of Fed rate hike at July 27 meeting, 58.4% chance at September 21 meeting
Overseas Futures:
  • Nikkei 225 Futures: Indicating -101 open in Japan 
  • China A50 Futures: Indicating -80 open in China
  • DAX Futures: Indicating +8 open in Germany
Portfolio: 
  • Higher: On gains in my retail sector longs, index hedges and emerging markets shorts
  • Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

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