Stocks Lower into Afternoon on US Policy-Induced Stagflation Fears, Earnings Outlook Jitters, Consumer Spending Worries, Tech/Consumer Discretionary 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) 30.3 +6.4%
• Bloomberg Global Risk On/Risk Off Index 3,609.0 -405.0 points

• Euro/Yen Carry Return Index 139.82 -.64%

• Emerging Markets Currency Volatility(VXY) 12.2 -.9%

• CBOE S&P 500 Implied Correlation Index 49.1 -1.0% 

• ISE Sentiment Index 93.0 -9.0 points
  

• Total Put/Call 1.0 +2.0%

• NYSE Arms 1.91 +162.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 88.88 +.44%
  

• US Energy High-Yield OAS 439.41 +2.1%

• European Financial Sector CDS Index 108.12 +1.9%

• Italian/German 10Y Yld Spread 201.0 basis points -1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 127.87 -1.0%
  

• Emerging Market CDS Index 292.10 +1.4%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 28.9 -.09%
  
• Russia Sovereign Debt Credit Default Swap 10,076.40 -1.6%
  

• 2-Year Swap Spread 31.0 basis points +1.5 basis points
  

• TED Spread 46.25 basis points -3.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -18.75 basis points -.5 basis point
  
• MBS  5/10 Treasury Spread  120.0 unch.
  
• iShares CMBS ETF 48.74 +.89%
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 52.52 -.04%
• 3-Month T-Bill Yield 1.05% +5.0 basis points
  

• Yield Curve 27.25 basis points (2s/10s) +4.5 basis points
  

• China Iron Ore Spot 130.5 USD/Metric Tonne -1.3%

• Citi US Economic Surprise Index -37.3 -16.5 points

• Citi Eurozone Economic Surprise Index 10.1 -8.4 points
  

• Citi Emerging Markets Economic Surprise Index 11.8 -.2 point

• 10-Year TIPS Spread 2.58 -5.0 basis points
  
• 0.0%(unch.) chance of no change at July 27th FOMC meeting, 0.0%(unch.) chance of no change at September 21st meeting

US Covid-19:

• 218 new infections/100K people(last 7 days total). 13.0%(unch.) of 1/14 peak -6/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -85.0%(unch.) from peak 7-day avg. of 1/9/21 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -83 open in Japan 
• China A50 Futures: Indicating -8 open in China

• DAX Futures: Indicating +54 open in Germany

Portfolio:

• Slightly Lower: On losses in my tech/medical/industrial sector longs
  

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges and to my emerging market shorts, then covered some
  

• Market Exposure:  Moved to 25% Net Long