Stocks Rising into Final Hour on Diminished Mid-East Regional War Fears, Lower Long-Term Rates, Earnings Outlook Optimism, Tech/Homebuilding Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Around Even
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 14.9 -.2%
• DJIA Intraday % Swing .53% +36.0%
  
• Bloomberg Global Risk On/Risk Off Index 64.7 -1.3%

• Euro/Yen Carry Return Index 171.8 +.06%

• Emerging Markets Currency Volatility(VXY) 7.82 -.9%

• CBOE S&P 500 Implied Correlation Index 24.4 -.7% 

• ISE Sentiment Index 123.0 +32.0
  

• Total Put/Call .97 -11.8%

• NYSE Arms 1.12 -22.2% 
• NYSE Non-Block Money Flow -$60.3M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 70.0 -1.7%
  

• US Energy High-Yield OAS 340.7 +3.6%
• Bloomberg TRACE # Distressed Bonds Traded 367 -11
  

• European Financial Sector CDS Index 89.47 -1.1% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 265.6 +1.3%
  

• Italian/German 10Y Yld Spread 189.0 basis points -2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 118.8 -3.2%
  

• Emerging Market CDS Index 211.42 -.88%
• Israel Sovereign CDS 125.1 -4.1%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.8 -.08%

• 2-Year SOFR Swap Spread -15.75 basis points -1.5 basis points
  

• TED Spread 21.0 basis points -4.0 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -21.5 -1.25 basis points
  
• MBS  5/10 Treasury Spread 168.0 -2.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 908.0 +1.0 basis point
  
• Avg. Auto ABS OAS 98.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.67 -.17%
• 3-Month T-Bill Yield 5.42% unch.
  

• China Iron Ore Spot 121.8 USD/Metric Tonne -1.1%
• Dutch TTF Nat Gas(European benchmark) 46.1 euros/megawatt-hour +2.7%

• Citi US Economic Surprise Index 50.6 +.1 point

• Citi Eurozone Economic Surprise Index -45.3 -1.9 points

• Citi Emerging Markets Economic Surprise Index 20.9 -2.1 points
• S&P 500 Current Quarter EPS Growth Rate YoY(424 of 500 reporting) +2.5% -.5 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 239.76 -.66:  Growth Rate +8.3% -.4 percentage point, P/E 18.3 +.1
  
• S&P 500 Current Year Estimated Profit Margin 12.13% -1.0 basis point
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +38.4% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 274.71 +.82: Growth Rate +62.1% +.5 percentage point, P/E 28.4 +.5
  
• Bloomberg US Financial Conditions Index .05 -3.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .83 +79.0 basis points
  
• US Yield Curve -34.75 basis points (2s/10s) -7.25 basis points
  
• US Atlanta Fed 3Q GDPNow Forecast +2.09% +.85 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.63% unch.: CPI YoY +3.28% unch.
  
• 10-Year TIPS Spread 2.39 -2.0 basis points
  
• Highest target rate probability for Jan. 31st FOMC meeting: 84.6%(+1.7 percentage points) chance of 5.25%-5.5%. Highest target rate probability for March 20th meeting: 65.1%(-.5 percentage point) chance of 5.25%-5.5%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +229 open in Japan 
• China A50 Futures: Indicating +15 open in China

• DAX Futures: Indicating +70 open in Germany

Portfolio:

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

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

• Market Exposure: Moved to 100% Net Long