Stocks Modestly Lower into Afternoon on US Policy-Induced Stagflation Fears, Regional Bank Contagion Concerns, Global Growth Worries, Financial/Commodity Sector Weakness

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) 17.2 +1.7%
• DJIA Intraday % Swing .79%
  
• Bloomberg Global Risk On/Risk Off Index 52.0 -4.3%

• Euro/Yen Carry Return Index 153.7 -.5%

• Emerging Markets Currency Volatility(VXY) 9.83 +2.1%

• CBOE S&P 500 Implied Correlation Index 33.7 +2.2% 

• ISE Sentiment Index 116.0 +25.0 points
  

• Total Put/Call .86 -8.5%

• NYSE Arms 1.03 -27.0%

Credit Investor Angst:

• North American Investment Grade CDS Index 81.5 +.68%
  

• US Energy High-Yield OAS 421.95 +1.87%
• Bloomberg TRACE # Distressed Bonds Traded 425.0 unch.
  

• European Financial Sector CDS Index 104.07 +.97% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 394.38 +.5%
  

• Italian/German 10Y Yld Spread 189.0 basis points -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 131.3 -2.1%
  

• Emerging Market CDS Index 247.84 -.27%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.4 -.02%

• 2-Year Swap Spread 21.25 basis points -4.0 basis points
  

• TED Spread 17.5 basis points +5.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -22.0 -2.75 basis points
  
• MBS  5/10 Treasury Spread 165.0 -6.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 711.0 -4.0 basis points
  
• Avg. Auto ABS OAS 94.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.7 -.4%
• 3-Month T-Bill Yield 5.15% -7.0 basis points
  

• China Iron Ore Spot 98.7 USD/Metric Tonne -2.7%
• Dutch TTF Nat Gas(European benchmark) 35.0 euros/megawatt-hour unch.

• Citi US Economic Surprise Index 12.8 -4.3 points

• Citi Eurozone Economic Surprise Index -21.1 +.1 point
  

• Citi Emerging Markets Economic Surprise Index 35.1 -4.5 points
• S&P 500 Current Quarter EPS Growth Rate YoY(455 of 500 reporting) -3.9% -.3 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 227.83 -.01:  Growth Rate +2.2% unch., P/E 18.2 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.24% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(8 of 10 reporting) -2.1% -.1 percentage point
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 197.63 n/a: Growth Rate +29.99% n/a, P/E 32.2 n/a
  
• Bloomberg US Financial Conditions Index -.14 -11.0 basis points
• Bloomberg Euro-Zone Financial Conditions Index -4.57 -17.0 basis points
  
• US Yield Curve -50.5 basis points (2s/10s) -4.75 basis points
• US Atlanta Fed 2Q GDPNow Forecast +2.75% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.65% unch.: CPI YoY +4.14% unch.
  
• 10-Year TIPS Spread 2.16 -4.0 basis points
  
• Highest target rate probability for July 26th FOMC meeting: 52.2%(-5.6 percentage points) chance of 5.0%-5.25%. Highest target rate probability for Sept. 20th meeting: 49.2%(-3.5 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +26 open in Japan 
• China A50 Futures: Indicating +34 open in China

• DAX Futures: Indicating +51 open in Germany

Portfolio:

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

• Disclosed Trades:  Added to my (IWM)/(QQQ) hedges
  

• Market Exposure: Moved to 25% Net Long