Stocks Reversing Slightly Lower into Afternoon on Rising Fed Rate-Hike Odds, Regional Bank Contagion Worries, Earnings Outlook Jitters, Regional Bank/Alt Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Below Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 16.7 -1.5%
• DJIA Intraday % Swing .60%
  
• Bloomberg Global Risk On/Risk Off Index 58.3 +.24%

• Euro/Yen Carry Return Index 153.7 +.08%

• Emerging Markets Currency Volatility(VXY) 10.0 unch.

• CBOE S&P 500 Implied Correlation Index 30.9 +.8% 

• ISE Sentiment Index 115.0 +20.0 points
  

• Total Put/Call .90 -11.8%

• NYSE Arms .93 +31.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 73.5 -.25%
  

• US Energy High-Yield OAS 360.7 +.1%
• Bloomberg TRACE # Distressed Bonds Traded 386.0 +20
  

• European Financial Sector CDS Index 92.4 -2.2% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 340.40 -4.0%
  

• Italian/German 10Y Yld Spread 182.0 basis basis points -1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 121.7 +.13%
  

• Emerging Market CDS Index 233.19 +.80%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.97 -.06%

• 2-Year Swap Spread 30.5 basis points +.5 basis point
  

• TED Spread 18.0 basis points -8.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -16.25 -.75 basis point
  
• MBS  5/10 Treasury Spread 167.0 +3.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 693.0 unch.
  
• Avg. Auto ABS OAS 95.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.7 unch.
• 3-Month T-Bill Yield 5.12% +7.0 basis points
  

• China Iron Ore Spot 118.5 USD/Metric Tonne +.6%
• Dutch TTF Nat Gas(European benchmark) 42.7 euros/megawatt-hour +3.9%

• Citi US Economic Surprise Index 36.9 -2.2 points

• Citi Eurozone Economic Surprise Index 38.1 -5.7 points
  

• Citi Emerging Markets Economic Surprise Index 32.7 +9.2 points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 226.08 +.10:  Growth Rate +1.6% unch., P/E 18.4 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.26% unch.
  
• Bloomberg US Financial Conditions Index .29 +10.0 basis points
• Bloomberg Euro-Zone Financial Conditions Index -4.06 +7.0 basis points
  
• US Yield Curve -63.75 basis points (2s/10s) -2.75 basis points
• US Atlanta Fed 1Q GDPNow Forecast +2.48% +1.0 basis point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.58% unch.: CPI YoY +5.17% +5.0 basis points
  
• 10-Year TIPS Spread 2.28 -3.0 basis points
  
• Highest target rate probability for June 14th FOMC meeting: 71.1%(+4.2 percentage points) chance of 5.0%-5.25%. Highest target rate probability for July 26th meeting: 61.0%(+6.3 percentage points) chance of 5.0%-5.25%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -13 open in Japan 
• China A50 Futures: Indicating -19 open in China

• DAX Futures: Indicating +134 open in Germany

Portfolio:

• Higher:  On gains in my tech/industrial sector longs and emerging market shorts
  

• Disclosed Trades:  None
  

• Market Exposure: 50% Net Long