Stocks Reversing Higher into Final Hour on Regional Bank Bounce, Less European/US High-Yield Debt Angst, Short-Covering, Financial/Biotech Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Higher
  

• Sector Performance: Mixed
  

• Volume: Below Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 18.6 -2.6%
• DJIA Intraday % Swing .60%
  
• Bloomberg Global Risk On/Risk Off Index 53.23 +.7%

• Euro/Yen Carry Return Index 150.4 +.6%

• Emerging Markets Currency Volatility(VXY) 11.7 +.2%

• CBOE S&P 500 Implied Correlation Index 33.8 -2.0% 

• ISE Sentiment Index 111.0 +4.0 points
  

• Total Put/Call .94 -4.1%

• NYSE Arms 1.0 +5.3%

Credit Investor Angst:

• North American Investment Grade CDS Index 79.1 -1.3%
  

• US Energy High-Yield OAS 393.38 -1.4%
• Bloomberg TRACE # Distressed Bonds Traded 440.0 -5
  

• European Financial Sector CDS Index 104.2 -3.1% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 412.3 -2.5%
  

• Italian/German 10Y Yld Spread 185.0 basis basis points +2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 132.0 +1.5%
  

• Emerging Market CDS Index 241.3 +.38%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.94 -.04%

• 2-Year Swap Spread 33.0 basis points +1.0 basis point
  

• TED Spread 48.0 basis points -.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -19.25 -.25 basis point
  
• MBS  5/10 Treasury Spread 158.0 +6.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 687.0 -2.0 basis points
  
• Avg. Auto ABS OAS 93.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.7 -.20%
• 3-Month T-Bill Yield 4.78% -1.0 basis point
  

• China Iron Ore Spot 116.1 USD/Metric Tonne -1.2%
• Dutch TTF Nat Gas(European benchmark) 43.1 euros/megawatt-hour -3.3%

• Citi US Economic Surprise Index 31.4 -15.9 points

• Citi Eurozone Economic Surprise Index 56.5 +2.7 points
  

• Citi Emerging Markets Economic Surprise Index 25.7 +.2 point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 226.06 -.08:  Growth Rate +1.6% -.1 percentage point, P/E 18.1 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.29% unch.
  
• Bloomberg US Financial Conditions Index -.42 -2.0 basis points
• Bloomberg Euro-Zone Financial Conditions Index -4.08 -6.0 basis points
  
• US Yield Curve -53.25 basis points (2s/10s) -6.0 basis points
• US Atlanta Fed 1Q GDPNow Forecast +1.47% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.60% unch.: CPI YoY +5.22% unch.
  
• 10-Year TIPS Spread 2.25 unch.
  
• Highest target rate probability for June 14th FOMC meeting: 49.5%(-4.5 percentage points) chance of 4.75%-5.0%. Highest target rate probability for July 26th meeting: 45.5%(+6.8 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +227 open in Japan 
• China A50 Futures: Indicating +68 open in China

• DAX Futures: Indicating +185 open in Germany

Portfolio:

• Slightly Higher:  On gains in my utility/medical/tech sector longs
  

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

• Market Exposure: Moved to 50% Net Long