Stocks Slightly Lower into Afternoon on Tax Hike Fears, China Debt Bubble Worries, Labor/Product Shortage Concerns, Commodity/Alt Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Below Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 18.7 +3.0%
• Bloomberg Global Risk On/Risk Off Index 2,993.0 -14.0 points

• Euro/Yen Carry Return Index 133.12 -.22%

• Emerging Markets Currency Volatility(VXY) 8.54 +.95%.

• S&P 500 Implied Correlation 54.44 +2.5%

• ISE Sentiment Index 135.0  +28.0 points
  

• Total Put/Call .80 -4.8%

• NYSE Arms 1.11 +33.7%

Credit Investor Angst:

• North American Investment Grade CDS Index 46.37 +.12%
  

• US Energy High-Yield OAS 377.10 -.94%

• European Financial Sector CDS Index 50.57 -1.0%

• Italian/German 10Y Yld Spread 99.5 -.5 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 67.19 +.46%
  

• Emerging Market CDS Index 154.09 +.90%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 37.8 -.62%

• 2-Year Swap Spread 10.75 +.25 basis point
  

• TED Spread 8.25 unch.
  

• 3-Month EUR/USD Cross-Currency Basis Swap -4.5 unch.
  
• MBS  5/10 Treasury Spread  74.25 +1.25 basis points
  
• IHS Markit CMBX BBB- 6 72.25 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 59.90 -.56%
• 3-Month T-Bill Yield .03% -1.0 basis point
  

• Yield Curve 109.0 +1.0 basis point
  

• China Iron Ore Spot 103.0 USD/Metric Tonne -8.3%

• Citi US Economic Surprise Index -44.6 +17.1 points

• Citi Eurozone Economic Surprise Index -18.5 -.6 point
  

• Citi Emerging Markets Economic Surprise Index 6.3 +1.6 points

• 10-Year TIPS Spread 2.36 +1.0 basis point
• 100.0% chance of no change at Nov. 3rd meeting, 100.0% chance of no change at Dec. 15th meeting

US Covid-19:

• 328 new infections/100K people(last 7 days total) -4/100K people
• 62% of Jan. 7th, 2021 peak(highest daily avg. new infections) unch.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +17 open in Japan 
• China A50 Futures: Indicating +13 open in China

• DAX Futures: Indicating +45 open in Germany

Portfolio:

• Higher: On gains in my biotech/consumer discretionary sector longs, index hedges and emerging market shorts
  

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

• Market Exposure: Moved to 100% Net Long