Stocks Lower into Close on China Economy Worries, Escalating Geopolitical Tensions, Emerging Markets/European/US High-Yield Debt Angst, Tech/Transport Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.3 +6.5%
• DJIA Intraday % Swing .74% +208.3%
  
• Bloomberg Global Risk On/Risk Off Index 55.4 -1.3%

• Euro/Yen Carry Return Index 167.0 -.13%

• Emerging Markets Currency Volatility(VXY) 8.2 -.24%

• CBOE S&P 500 Implied Correlation Index 19.4 +.6% 

• ISE Sentiment Index 137.0 -1.0
  

• Total Put/Call .97 unch.

• NYSE Arms .93 -33.6% 
• NYSE Non-Block Money Flow -$115.7M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 58.5 +3.4%
  

• US Energy High-Yield OAS 351.4 +3.6%
• Bloomberg TRACE # Distressed Bonds Traded 253 -8
  

• European Financial Sector CDS Index 70.5 +4.4% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 212.60 +3.8%
  

• Italian/German 10Y Yld Spread 165.0 basis points -1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 90.3 -.06%
  

• Emerging Market CDS Index 176.3 +5.3%
• Israel Sovereign CDS 111.5 +1.0%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.1 +.4%

• 2-Year SOFR Swap Spread -18.25 basis points unch.
  

• TED Spread 22.0 basis points -1.0 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -2.25 -.5 basis point
  
• MBS  5/10 Treasury Spread 149.0 +6.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 966.0 -1.0 basis point
  
• Avg. Auto ABS OAS 76.0 -2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.4 -.70%
• 3-Month T-Bill Yield 5.37% -1.0 basis point
  

• China Iron Ore Spot 140.7 USD/Metric Tonne -.75%
• Dutch TTF Nat Gas(European benchmark) 30.60 euros/megawatt-hour -5.5%

• Citi US Economic Surprise Index 1.1 -9.3 points

• Citi Eurozone Economic Surprise Index -40.5 +.1 point

• Citi Emerging Markets Economic Surprise Index 13.8 -1.6 points
• S&P 500 Current Quarter EPS Growth Rate YoY(17 of 500 reporting) +13.5% unch.
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 243.36 +.12:  Growth Rate +11.8% +.1 percentage point, P/E 19.5 -.2
  
• S&P 500 Current Year Estimated Profit Margin 12.04% unch.
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) +0.0% -0.0 percentage points
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 289.55 +.62: Growth Rate +35.7% +.2 percentage point, P/E 29.5 -.9
  
• Bloomberg US Financial Conditions Index n/a
  
• Bloomberg Euro-Zone Financial Conditions Index .74 +38.0 basis points
  
• US Yield Curve -39.25 basis points (2s/10s) +.75 basis point
  
• US Atlanta Fed 4Q GDPNow Forecast +2.03% -23.0 basis points
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 67.0% -.8 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.02% unch.: CPI YoY +3.32% unch.
  
• 10-Year TIPS Spread 2.21 +3.0 basis points
  
• Highest target rate probability for March 20th FOMC meeting: 71.9%(-1.5 percentage points) chance of 5.0%-5.25%. Highest target rate probability for May 1st meeting: 69.2%(-2.7 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -279 open in Japan 
• China A50 Futures: Indicating -18 open in China

• DAX Futures: Indicating +111 open in Germany

Portfolio:

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

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
  

• Market Exposure: Moved to 25% Net Long