Stocks Higher into Afternoon on Lower Long-Term Rates, Earnings Outlook Optimism, Short-Covering, Gambling/Metals & Mining Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 15.4 -2.0%
• DJIA Intraday % Swing .48% -30.8%
  
• Bloomberg Global Risk On/Risk Off Index 64.7 -1.6%

• Euro/Yen Carry Return Index 171.2 +.35%

• Emerging Markets Currency Volatility(VXY) 7.82 -.64%

• CBOE S&P 500 Implied Correlation Index 25.8 -.9% 

• ISE Sentiment Index 101.0 +6.0
  

• Total Put/Call .88 -9.3%

• NYSE Arms 1.04 +28.4%

Credit Investor Angst:

• North American Investment Grade CDS Index 70.54 -2.96%
  

• US Energy High-Yield OAS 325.70 -1.56%
• Bloomberg TRACE # Distressed Bonds Traded 391 -18
  

• European Financial Sector CDS Index 89.70 -2.1% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 258.66 -2.2%
  

• Italian/German 10Y Yld Spread 187.0 basis points -4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 127.3 -1.9%
  

• Emerging Market CDS Index 206.80 -2.0%
• Israel Sovereign CDS 142.57 +2.1%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.82 +.45%

• 2-Year SOFR Swap Spread -13.0 basis points +.5 basis point
  

• TED Spread 24.5 basis points +3.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -20.0 +2.5 basis points
  
• MBS  5/10 Treasury Spread 169.0 -3.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 923.0 -3.0 basis points
  
• Avg. Auto ABS OAS 97.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.75 +.64%
• 3-Month T-Bill Yield 5.41% -1.0 basis point
  

• China Iron Ore Spot 123.2 USD/Metric Tonne +1.2%
• Dutch TTF Nat Gas(European benchmark) 48.1 euros/megawatt-hour -1.0%

• Citi US Economic Surprise Index 51.2 -5.2 points

• Citi Eurozone Economic Surprise Index -47.9 -.2 point

• Citi Emerging Markets Economic Surprise Index 24.3 +.3 point
• S&P 500 Current Quarter EPS Growth Rate YoY(404 of 500 reporting) +2.2% +.5 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 240.56 +.06:  Growth Rate +8.9% -.6 percentage point, P/E 18.1 +.2
  
• S&P 500 Current Year Estimated Profit Margin 12.20% +3.0 basis points
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +38.4% -13.5 percentage points
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 273.42 +.13: Growth Rate +61.3% +.1 percentage point, P/E 27.5 +.1
  
• Bloomberg US Financial Conditions Index -.07 -2.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .66 +6.0 basis points
  
• US Yield Curve -28.5 basis points (2s/10s) +2.5 basis points
  
• US Atlanta Fed 3Q GDPNow Forecast +1.24% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.63% unch.: CPI YoY +3.28% unch.
  
• 10-Year TIPS Spread 2.38 -2.0 basis points
  
• Highest target rate probability for Jan. 31st FOMC meeting: 89.4%(+18.4 percentage points) chance of 5.25%-5.5%. Highest target rate probability for March 20th meeting: 67.3%(+3.6 percentage points) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +830 open in Japan 
• China A50 Futures: Indicating +79 open in China

• DAX Futures: Indicating +64 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 100% Net Long