Stocks Falling into Afternoon on Rising Long-Term Rates, Earnings Outlook Worries, Technical Selling, Tech/Homebuilding Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.8 +7.3%
• DJIA Intraday % Swing .95%
  
• Bloomberg Global Risk On/Risk Off Index 73.2 +.6%

• Euro/Yen Carry Return Index 167.5 +.5%

• Emerging Markets Currency Volatility(VXY) 8.5 -.7%

• CBOE S&P 500 Implied Correlation Index 20.1 +10.0% 

• ISE Sentiment Index 98.0 +4.0 points
  

• Total Put/Call .93 -17.0%

• NYSE Arms .94 +28.8%

Credit Investor Angst:

• North American Investment Grade CDS Index 63.4 +1.3%
  

• US Energy High-Yield OAS 309.9 +1.47%
• Bloomberg TRACE # Distressed Bonds Traded 362.0 -12
  

• European Financial Sector CDS Index 79.5 +.51% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 262.5 -2.8%
  

• Italian/German 10Y Yld Spread 179.0 basis points +4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 115.5 -.03%
  

• Emerging Market CDS Index 203.6 +1.3%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 25.0 -.08%

• 2-Year SOFR Swap Spread -10.0 basis points +.75 basis point
  

• TED Spread 22.5 basis points +1.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -10.25 unch.
  
• MBS  5/10 Treasury Spread 166.0 +3.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 922.0 -1.0 basis point
  
• Avg. Auto ABS OAS 78.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 42.3 -.01%
• 3-Month T-Bill Yield 5.45% -1.0 basis point
  

• China Iron Ore Spot 120.5 USD/Metric Tonne -2.0%
• Dutch TTF Nat Gas(European benchmark) 36.5 euros/megawatt-hour +2.7%

• Citi US Economic Surprise Index 64.8 +3.4 points

• Citi Eurozone Economic Surprise Index -68.9 +1.7 points

• Citi Emerging Markets Economic Surprise Index 15.2 +4.4 points
• S&P 500 Current Quarter EPS Growth Rate YoY(3 of 500 reporting) +7.2% n/a
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 239.0 +.07:  Growth Rate +8.7% unch., P/E 18.9 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.14% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 247.29 +.16: Growth Rate +49.1% +.1 percentage point, P/E 31.3 -.6
  
• Bloomberg US Financial Conditions Index .50 -6.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .47 +21.0 basis points
  
• US Yield Curve -71.5 basis points (2s/10s) +1.5 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +4.94% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.95% unch.: CPI YoY +3.66% unch.
  
• 10-Year TIPS Spread 2.35 +1.0 basis point
  
• Highest target rate probability for Nov. 1st FOMC meeting: 68.5%(+5.5 percentage points) chance of 5.25%-5.5%. Highest target rate probability for Dec. 13th meeting: 61.1%(+1.8 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -458 open in Japan 
• China A50 Futures: Indicating -38 open in China

• DAX Futures: Indicating +136 open in Germany

Portfolio:

• Lower:  On losses in my tech/medical/transport/industrial/commodity sector longs
  

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
  

• Market Exposure: Moved to 25% Net Long