Stocks Higher into Afternoon on US Debt Ceiling Deal Optimism, US Economic "Soft-Landing" Hopes, AI Stock Frenzy, Tech/Transport Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 19.1 -4.6%
• DJIA Intraday % Swing .82%
  
• Bloomberg Global Risk On/Risk Off Index 57.8 +2.7%

• Euro/Yen Carry Return Index 157.4 +.08%

• Emerging Markets Currency Volatility(VXY) 9.6 +1.5%

• CBOE S&P 500 Implied Correlation Index 28.5 -10.9% 

• ISE Sentiment Index 131.0 +14.0 points
  

• Total Put/Call .81 -21.4%

• NYSE Arms 1.10 +12.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 77.7 -1.9%
  

• US Energy High-Yield OAS 393.44 -1.8%
• Bloomberg TRACE # Distressed Bonds Traded 424.0 unch.
  

• European Financial Sector CDS Index 94.95 -2.5% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 322.30 -1.1%
  

• Italian/German 10Y Yld Spread 188.0 basis points +1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 127.2 +1.5%
  

• Emerging Market CDS Index 256.87 -.5%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 25.8 unch.

• 2-Year Swap Spread 20.75 basis points -1.25 basis points
  

• TED Spread 7.25 basis points +1.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -21.75 -1.0 basis point
  
• MBS  5/10 Treasury Spread 187.0 +6.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 719.0 +1.0 basis point
  
• Avg. Auto ABS OAS 92.0 -2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 46.9 -.44%
• 3-Month T-Bill Yield 5.32% -1.0 basis point
  

• China Iron Ore Spot 95.5 USD/Metric Tonne -.23%
• Dutch TTF Nat Gas(European benchmark) 25.4 euros/megawatt-hour  -8.4%

• Citi US Economic Surprise Index 6.9 +6.4 points

• Citi Eurozone Economic Surprise Index -46.0 -5.6 points

• Citi Emerging Markets Economic Surprise Index 13.8 +.2 point
• S&P 500 Current Quarter EPS Growth Rate YoY(482 of 500 reporting) -3.0% +.3 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 228.97 +.34:  Growth Rate +2.4% +.1 percentage point, P/E 18.1 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.23% -1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(10 of 10 reporting) -2.7% -.6 percentage point
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 200.03 +.07: Growth Rate +29.2% +.1 percentage point, P/E 34.6 +1.2
  
• Bloomberg US Financial Conditions Index .01 +1.0 basis point
• Bloomberg Euro-Zone Financial Conditions Index -4.73 -3.0 basis points
  
• US Yield Curve -69.5 basis points (2s/10s) -7.75 basis points
• US Atlanta Fed 2Q GDPNow Forecast +2.89% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.65% unch.: CPI YoY +4.12% unch.
  
• 10-Year TIPS Spread 2.26 unch.
  
• Highest target rate probability for July 26th FOMC meeting: 50.0%(+4.8 percentage points) chance of 5.25%-5.5%. Highest target rate probability for Sept. 20th meeting: 43.7%(+8.6 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +279 open in Japan 
• China A50 Futures: Indicating -61 open in China

• DAX Futures: Indicating +82 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