Stocks Rising into Final Hour on Earnings Outlook Optimism, Loosening US Financial Conditions, Less China Economy Pessimism, Tech/Transport Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.8 -.4%
• DJIA Intraday % Swing .45%
  
• Bloomberg Global Risk On/Risk Off Index 71.9 +2.0%

• Euro/Yen Carry Return Index 167.0 -.42%

• Emerging Markets Currency Volatility(VXY) 8.8 +.46%

• CBOE S&P 500 Implied Correlation Index 19.7 -.6% 

• ISE Sentiment Index 101.0 -15.0 points
  

• Total Put/Call .96 -10.3%

• NYSE Arms .97 +10.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 63.4 -1.5%
  

• US Energy High-Yield OAS 310.35 -.17%
• Bloomberg TRACE # Distressed Bonds Traded 327.0 -19
  

• European Financial Sector CDS Index 81.2 -1.09% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 270.6 -.05%
  

• Italian/German 10Y Yld Spread 176.0 basis points +2.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 121.6 -.92%
  

• Emerging Market CDS Index 201.5 -.38%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.9 -.2%

• 2-Year SOFR Swap Spread -10.75 basis points -.75 basis point
  

• TED Spread 22.0 basis points +.75 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -11.25 +.5 basis point
  
• MBS  5/10 Treasury Spread 166.0 -1.0 basis point
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 807.0 +1.0 basis point
  
• Avg. Auto ABS OAS 75.0 +1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 42.3 +.41%
• 3-Month T-Bill Yield 5.44% -1.0 basis point
  

• China Iron Ore Spot 117.9 USD/Metric Tonne +.43%
• Dutch TTF Nat Gas(European benchmark) 35.8 euros/megawatt-hour +3.9%

• Citi US Economic Surprise Index 58.5 -2.9 points

• Citi Eurozone Economic Surprise Index -71.3 -2.8 points

• Citi Emerging Markets Economic Surprise Index 9.4 +3.1 points
• S&P 500 Current Quarter EPS Growth Rate YoY(497 of 500 reporting) -5.8%  unch.
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 238.6 +.23:  Growth Rate +8.6% +.1 percentage point, P/E 18.7 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.13% -1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(10 of 10 reporting) +25.4% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 246.31 +.57: Growth Rate +48.5% +.3 percentage point, P/E 32.0 +.2
  
• Bloomberg US Financial Conditions Index .48 +3.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .21 +75.0 basis points
  
• US Yield Curve -70.75 basis points (2s/10s) +1.5 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +5.57% -1.0 basis point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.03% unch.: CPI YoY +3.82% unch.
  
• 10-Year TIPS Spread 2.35 +2.0 basis points
  
• Highest target rate probability for Nov. 1st FOMC meeting: 54.5%(+.9 percentage point) chance of 5.25%-5.5%. Highest target rate probability for Dec. 13th meeting: 54.0%(+.6 percentage point) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +20 open in Japan 
• China A50 Futures: Indicating +20 open in China

• DAX Futures: Indicating +52 open in Germany

Portfolio:

• Higher:  On gains in my tech/medical/transport sector longs
  

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

• Market Exposure: Moved to 100% Net Long