Stocks Rising into Afternoon on Earnings Outlook Optimism, Stable Long-Term Rates, Short-Covering, Alt Energy/Technology Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Below Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 13.6 +1.7%
• DJIA Intraday % Swing .53%
  
• Bloomberg Global Risk On/Risk Off Index 65.0 -.8%

• Euro/Yen Carry Return Index 164.5 +.07%

• Emerging Markets Currency Volatility(VXY) 8.4 +1.45%

• CBOE S&P 500 Implied Correlation Index 16.5 -.5% 

• ISE Sentiment Index 132.0 +16.0 points
  

• Total Put/Call .75 -11.8%

• NYSE Arms 1.28 -22.4%

Credit Investor Angst:

• North American Investment Grade CDS Index 66.7 +.43%
  

• US Energy High-Yield OAS 353.80 +1.44%
• Bloomberg TRACE # Distressed Bonds Traded 390.0 -6.0
  

• European Financial Sector CDS Index 82.0 +1.1% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 266.8 +1.1%
  

• Italian/German 10Y Yld Spread 167.0 basis points +2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 111.0 +.03%
  

• Emerging Market CDS Index 204.70 -.36%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 25.9 -.33%

• 2-Year Swap Spread 21.75 basis points unch.
  

• TED Spread 21.75 basis points +1.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -12.75 -1.5 basis points
  
• MBS  5/10 Treasury Spread 162.0 +6.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 715.0 -3.0 basis points
  
• Avg. Auto ABS OAS 78.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 43.8 -.26%
• 3-Month T-Bill Yield 5.38% unch.
  

• China Iron Ore Spot 112.9 USD/Metric Tonne +.4%
• Dutch TTF Nat Gas(European benchmark) 25.1 euros/megawatt-hour  -3.3%

• Citi US Economic Surprise Index 74.8 +7.0 points

• Citi Eurozone Economic Surprise Index -129.5 +6.4 points

• Citi Emerging Markets Economic Surprise Index -10.2 -10.0 points
• S&P 500 Current Quarter EPS Growth Rate YoY(28 of 500 reporting) +12.7% +19.7 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 231.33 +.10:  Growth Rate +3.5% +.1 percentage point, P/E 19.5 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.17% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 216.87 +.63: Growth Rate +42.5% +.4 percentage point, P/E 37.2 +.3
  
• Bloomberg US Financial Conditions Index .41 +1.0 basis point
  
• Bloomberg Euro-Zone Financial Conditions Index -4.22 -10.0 basis points
  
• US Yield Curve -93.5 basis points (2s/10s) -4.75 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +2.29% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.19% unch.: CPI YoY +3.35% unch.
  
• 10-Year TIPS Spread 2.26 +1.0 basis point
  
• Highest target rate probability for Sept. 20th FOMC meeting: 84.1%(+.5 percentage point) chance of 5.25%-5.5%. Highest target rate probability for  Nov. 1st meeting: 68.2%(-.6 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -27 open in Japan 
• China A50 Futures: Indicating -46 open in China

• DAX Futures: Indicating +124 open in Germany

Portfolio:

• Higher:  On gains in my tech/industrial sector longs
  

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

• Market Exposure: Moved to 100% Net Long