Stocks Finish Mostly Higher on Fed Pause Hopes, Loosening US Financial Conditions, Earnings Outlook Optimism, Transport/Financial Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 13.6 -2.2%
• DJIA Intraday % Swing .57%
  
• Bloomberg Global Risk On/Risk Off Index 66.5 +.98%

• Euro/Yen Carry Return Index 164.1 -.22%

• Emerging Markets Currency Volatility(VXY) 8.7 -.6%

• CBOE S&P 500 Implied Correlation Index 17.9 +7.7% 

• ISE Sentiment Index 127.0 +25.0 points
  

• Total Put/Call .89 +2.3%

• NYSE Arms .98 -26.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 64.1 -1.1%
  

• US Energy High-Yield OAS 330.70 -.88%
• Bloomberg TRACE # Distressed Bonds Traded 365.0 -4.0
  

• European Financial Sector CDS Index 80.0 -.95% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 261.12 -1.0%
  

• Italian/German 10Y Yld Spread 162.0 basis points -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 105.5 -1.4%
  

• Emerging Market CDS Index 198.32 -.84%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 25.6 +.09%

• 2-Year Swap Spread 21.25 basis points unch.
  

• TED Spread 19.0 basis points -2.0 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -11.0 +.75 basis point
  
• MBS  5/10 Treasury Spread 160.0 -3.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 731.0 unch.
  
• Avg. Auto ABS OAS 73.0 -2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 43.5 +.15%
• 3-Month T-Bill Yield 5.42% +1.0 basis point
  

• China Iron Ore Spot 112.9 USD/Metric Tonne -.3%
• Dutch TTF Nat Gas(European benchmark) 29.3 euros/megawatt-hour  -10.3%

• Citi US Economic Surprise Index 68.2 -2.1 points

• Citi Eurozone Economic Surprise Index -136.7 +2.2 points

• Citi Emerging Markets Economic Surprise Index -8.3 -.8 point
• S&P 500 Current Quarter EPS Growth Rate YoY(149 of 500 reporting) +4.0% +1.5 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 231.54 +.05:  Growth Rate +3.7% unch., P/E 19.7 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.07% -1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(4 of 10 reporting) +15.9% +12.5 percentage points
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 220.01 +.14: Growth Rate +43.0% +.1 percentage point, P/E 35.4 -.3
  
• Bloomberg US Financial Conditions Index .51 +2.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index -.90 -83.0 basis points
  
• US Yield Curve -98.0 basis points (2s/10s) +1.0 basis point
  
• US Atlanta Fed 2Q GDPNow Forecast +2.41% -1.0 basis point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.19% unch.: CPI YoY +3.37% unch.
  
• 10-Year TIPS Spread 2.36 -3.0 basis points
  
• Highest target rate probability for Nov. 1st FOMC meeting: n/a(n/a) chance of 5.25%-5.5%. Highest target rate probability for  Dec. 13th meeting: n/a(n/a percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -113 open in Japan 
• China A50 Futures: Indicating +68 open in China

• DAX Futures: Indicating +81 open in Germany

Portfolio:

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

• Disclosed Trades: None
  

• Market Exposure: 75% Net Long