Stocks Falling into Afternoon on Surging Long-Term Rates, Earnings Outlook Jitters, Rising Oil Prices, Alt Energy/Airline Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 19.7 +9.7%
• DJIA Intraday % Swing .71% -18.0%
  
• Bloomberg Global Risk On/Risk Off Index 70.3 -2.9%

• Euro/Yen Carry Return Index 168.4 -.25%

• Emerging Markets Currency Volatility(VXY) 8.39 unch.

• CBOE S&P 500 Implied Correlation Index 27.9 +9.2% 

• ISE Sentiment Index 91.0 -8.0 points
  

• Total Put/Call .99 -5.7%

• NYSE Arms .93 +72.2%

Credit Investor Angst:

• North American Investment Grade CDS Index 76.37 +1.6%
  

• US Energy High-Yield OAS 360.3 +1.7%
• Bloomberg TRACE # Distressed Bonds Traded 372 +11
  

• European Financial Sector CDS Index 98.71 +2.2% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 302.3 +1.0%
  

• Italian/German 10Y Yld Spread 206.0 basis points +5.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 129.5 +1.7%
  

• Emerging Market CDS Index 238.62 +2.1%
• Israel Sovereign CDS 128.8 +.8%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.78 unch.

• 2-Year SOFR Swap Spread -11.75 basis points +1.0 basis point
  

• TED Spread 16.0 basis points -1.75 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -26.0 +.75 basis point
  
• MBS  5/10 Treasury Spread 188.0 +2.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 907.0 -2.0 basis points
  
• Avg. Auto ABS OAS 86.0 -2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.1 -.29%
• 3-Month T-Bill Yield 5.50% +1.0 basis point
  

• China Iron Ore Spot 115.7 USD/Metric Tonne -.2%
• Dutch TTF Nat Gas(European benchmark) 50.8 euros/megawatt-hour +4.0%

• Citi US Economic Surprise Index 54.4 -1.1 points

• Citi Eurozone Economic Surprise Index -36.2 +1.2 points

• Citi Emerging Markets Economic Surprise Index 23.9 +5.5 points
• S&P 500 Current Quarter EPS Growth Rate YoY(53 of 500 reporting) +6.5% -1.2 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 240.65 +4.43:  Growth Rate +9.4% +1.1 percentage points, P/E 18.2 -.3
  
• S&P 500 Current Year Estimated Profit Margin 12.15% -12.0 basis points
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 267.52 +.14: Growth Rate +57.8% +.1 percentage point, P/E 28.2 -.4
  
• Bloomberg US Financial Conditions Index .03 -8.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index -.13 +7.0 basis points
  
• US Yield Curve -32.5 basis points (2s/10s) +5.0 basis pointss
  
• US Atlanta Fed 2Q GDPNow Forecast +5.41% +26.0 basis points
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.70% unch.: CPI YoY +3.36% unch.
  
• 10-Year TIPS Spread 2.43 +2.0 basis points
  
• Highest target rate probability for Dec. 13th FOMC meeting: 61.1%(+3.7 percentage points) chance of 5.25%-5.5%. Highest target rate probability for Jan. 31st meeting: 52.3%(+2.0 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -282 open in Japan 
• China A50 Futures: Indicating -100 open in China

• DAX Futures: Indicating +89 open in Germany

Portfolio:

• Slightly Higher:  On gains in my commodity sector longs, index hedges and emerging market shorts
  

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

• Market Exposure: Moved to Market Neutral