Stocks Slightly Higher into Final Hour on Diminished Earnings Outlook Fears, Stable Long-Term Rates, Technical Buying, Tech/Energy Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Lower
  

• Sector Performance:  Mixed
  

• Volume:  Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 19.9 -.2%
• DJIA Intraday % Swing .43% -26.7%
  
• Bloomberg Global Risk On/Risk Off Index 3,942.0 -14.0 points

• Euro/Yen Carry Return Index 140.96 -.35%

• Emerging Markets Currency Volatility(VXY) 12.0 +1.44%

• CBOE S&P 500 Implied Correlation Index 41.4 -.7% 

• ISE Sentiment Index 106.0 +12.0 points
  

• Total Put/Call .87 -3.3%

• NYSE Arms 1.06 unch

Credit Investor Angst:

• North American Investment Grade CDS Index 77.44 -.59%
  

• US Energy High-Yield OAS 398.06 +1.21%
• Bloomberg TRACE # Distressed Bonds Traded 336.0 +4.0
  

• European Financial Sector CDS Index 105.19 -2.1%

• Italian/German 10Y Yld Spread 223.0 basis points unch.
  

• Asia Ex-Japan Investment Grade CDS Index 135.29 +1.16%
  

• Emerging Market CDS Index 311.32 +1.62%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.59 -.17%
  
• Ukraine Sovereign Debt Credit Default Swap 9,588.9 -3.5%
  

• 2-Year Swap Spread 34.5 basis points +3.0 basis points
  

• TED Spread 35.25 basis points +6.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -15.75 basis points +.5 basis point
  
• MBS  5/10 Treasury Spread  127.0 -2.0 basis points
  
• iShares CMBS ETF 48.32 +.33%
• Avg. Auto ABS OAS .93 +1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 48.90 -.78%
• 3-Month T-Bill Yield 2.63% +1.0 basis point
  

• Yield Curve -37.0 basis points (2s/10s) +4.25 basis points
  

• China Iron Ore Spot 101.55 USD/Metric Tonne -.1%

• Citi US Economic Surprise Index -17.6 +6.8 points

• Citi Eurozone Economic Surprise Index -51.6 +.2 point
  

• Citi Emerging Markets Economic Surprise Index 31.8 -1.1 points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 236.61 +.04:  Growth Rate +15.6% -1.0 percentage point, P/E 18.1 unch.
  
• US Atlanta Fed GDPNow Q3 Forecast +1.62% unch.
  
• Bloomberg US Financial Conditions Index -.27 -17.0 basis points
  

• 1-Year TIPS Spread 2.84 -1.0 basis point: 10-Year TIPS Spread 2.53 +6.0 basis points
  
• Highest target rate probability for November 2nd FOMC meeting: 49.4%(-1.4 percentage points) chance of 3.25%-3.5%. Highest target rate probability for December 14th meeting: 45.2%(-1.5 percentage points) chance of 3.50%-3.75%.
  

US Covid-19:

• 210 new infections/100K people(last 7 days total). 12.1%(-.4 percentage point) of 1/14/22 peak(1,740) -7/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -73.6%(-.8 percentage point) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +133 open in Japan 
• China A50 Futures: Indicating -32 open in China

• DAX Futures: Indicating -7 open in Germany

Portfolio:

• Slightly Higher:  On gains in my commodity/utility/tech sector longs and emerging market shorts
  

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

• Market Exposure:  Moved to 50% net long