Stocks Falling into Final Hour on Mid-East Regional War Fears, Earnings Outlook Jitters, Tightening US Financial Conditions, Tech/Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Mixed
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 20.6 +2.1%
• DJIA Intraday % Swing .92% +9.0%
  
• Bloomberg Global Risk On/Risk Off Index 64.4 -.7%

• Euro/Yen Carry Return Index 169.4 +.06%

• Emerging Markets Currency Volatility(VXY) 8.44 +.48%

• CBOE S&P 500 Implied Correlation Index 32.3 +1.3% 

• ISE Sentiment Index 111.0 +15.0
  

• Total Put/Call 1.05 -12.5%

• NYSE Arms .87 +22.5%

Credit Investor Angst:

• North American Investment Grade CDS Index 80.4 +.4%
  

• US Energy High-Yield OAS 3711.53 +1.2%
• Bloomberg TRACE # Distressed Bonds Traded 342 +13
  

• European Financial Sector CDS Index 103.09 +2.4% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 297.60 unch.
  

• Italian/German 10Y Yld Spread 201.0 basis points -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 138.6 +3.1%
  

• Emerging Market CDS Index 238.8 +.03%
• Israel Sovereign CDS 144.17 +1.1%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.7 unch.

• 2-Year SOFR Swap Spread -11.0 basis points -.25 basis point
  

• TED Spread 19.25 basis points +1.0 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -24.5 -.25 basis point
  
• MBS  5/10 Treasury Spread 188.0 -1.0 basis point
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 932.0 +1.0 basis point
  
• Avg. Auto ABS OAS 93.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.2 +.03%
• 3-Month T-Bill Yield 5.45% -1.0 basis point
  

• China Iron Ore Spot 116.8 USD/Metric Tonne -.21%
• Dutch TTF Nat Gas(European benchmark) 50.81 euros/megawatt-hour +1.8%

• Citi US Economic Surprise Index 61.2 +8.6 points

• Citi Eurozone Economic Surprise Index -42.6 -1.4 points

• Citi Emerging Markets Economic Surprise Index 27.4 +3.7 points
• S&P 500 Current Quarter EPS Growth Rate YoY(209 of 500 reporting) +11.1% +2.6 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 240.09 -.17:  Growth Rate +9.2% -.1 percentage point, P/E 17.3 -.2
  
• S&P 500 Current Year Estimated Profit Margin 12.11% +1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(4 of 10 reporting) +22.8% +43.7 percentage points
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 268.39 +.24: Growth Rate +58.3% +.1 percentage point, P/E 27.4 -.5
  
• Bloomberg US Financial Conditions Index -.25 -8.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index -.04 +5.0 basis points
  
• US Yield Curve -16.5 basis points (2s/10s) +9.5 basis points
  
• US Atlanta Fed 2Q GDPNow Forecast +5.41% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.70% unch.: CPI YoY +3.32% unch.
  
• 10-Year TIPS Spread 2.42 -2.0 basis points
  
• Highest target rate probability for Dec. 13th FOMC meeting: 72.9%(+3.8 percentage points) chance of 5.25%-5.5%. Highest target rate probability for Jan. 31st meeting: 67.1%(+6.4 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +94 open in Japan 
• China A50 Futures: Indicating +33 open in China

• DAX Futures: Indicating +69 open in Germany

Portfolio:

• Higher:  On gains in my utility/industrial sector longs, index hedges and emerging market shorts
  

• Disclosed Trades: None
  

• Market Exposure: 25% Net Long