Thursday, October 18, 2018

Stocks Falling into Final Hour on Fed Rate-Hike Fears, Trade War Worries, European/Emerging Market/US High-Yield Debt Angst, Tech/Transport Sector Weakness

 Broad Equity Market Tone:
  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Almost Every Sector Declining
  • Volume: Above Average
  • Market Leading Stocks: Underperforming
Equity Investor Angst:
  • Volatility(VIX) 20.10 +15.7%
  • Euro/Yen Carry Return Index 133.69 -.77%
  • Emerging Markets Currency Volatility(VXY) 9.70 +2.32%
  • S&P 500 Implied Correlation 40.96 +3.7%
  • ISE Sentiment Index 60.0 -30.2%
  • Total Put/Call 1.31 +12.9%
  • NYSE Arms 1.22 +62.7%
Credit Investor Angst:
  • North American Investment Grade CDS Index 66.99 +4.59%
  • America Energy Sector High-Yield CDS Index 414.0 +1.82%
  • European Financial Sector CDS Index 94.31 +5.09%
  • Italian/German 10Y Yld Spread 308.75 +18.25 basis points
  • Asia Pacific Sovereign Debt CDS Index 9.78 +.62%
  • Emerging Market CDS Index 205.25 +2.84%
  • iBoxx Offshore RMB China Corporate High Yield Index 150.20 +.06%
  • 2-Year Swap Spread 22.25 +3.25 basis points
  • TED Spread 15.0 -.5 basis point
  • 3-Month EUR/USD Cross-Currency Basis Swap -46.75 -.5 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 66.90 -.64%
  • 3-Month T-Bill Yield 2.30% unch.
  • Yield Curve 30.25 +.5 basis point
  • China Iron Ore Spot 71.86 USD/Metric Tonne -.32%
  • Citi US Economic Surprise Index -1.9 +.7 point
  • Citi Eurozone Economic Surprise Index -29.5 +.3 point
  • Citi Emerging Markets Economic Surprise Index -1.7 +.1 point
  • 10-Year TIPS Spread 2.11 -2.0 basis points
  • 72.0% chance of Fed rate hike at Dec. 19th meeting, 73.7% chance at Jan. 30th meeting
Overseas Futures:
  • Nikkei 225 Futures: Indicating -383 open in Japan 
  • China A50 Futures: Indicating -117 open in China
  • DAX Futures: Indicating -81 open in Germany
Portfolio: 
  • Lower: On losses in my industrial/retail/tech/biotech/medical  sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my (EEM) short
  • Market Exposure: Moved to 50% Net Long

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