Stocks Reversing Slightly Lower into Final Hour on Declining Fed Rate-Cut Odds, China Economy Worries, Higher Long-Term Rates, Technology/Commodity Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Mixed
  

• Volume: Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 13.9 -1.2%
• DJIA Intraday % Swing .78% +32.0%
  
• Bloomberg Global Risk On/Risk Off Index 55.8 +3.4%

• Euro/Yen Carry Return Index 170.2 +1.2%

• Emerging Markets Currency Volatility(VXY) 8.04 -1.1%

• CBOE S&P 500 Implied Correlation Index 20.6 -2.3% 

• ISE Sentiment Index 160.0 +25.0
  

• Total Put/Call .93 -8.8%

• NYSE Arms .88 -25.4% 
• NYSE Non-Block Money Flow -$64.6M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 59.6 -.8%
  

• US Energy High-Yield OAS 347.16 -2.5%
• Bloomberg TRACE # Distressed Bonds Traded 271 +21
  

• European Financial Sector CDS Index 73.81 -.86% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 222.27 +1.0%
  

• Italian/German 10Y Yld Spread 169.0 basis points +1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 99.0 +3.1%
  

• Emerging Market CDS Index 183.9 +1.2%
• Israel Sovereign CDS 113.05 +1.1%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.2 +.04%

• 2-Year SOFR Swap Spread -17.0 basis points +.75 basis point
  

• TED Spread 20.75 basis points +1.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -3.25 -.75 basis point
  
• MBS  5/10 Treasury Spread 149.0 +2.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 966.0 unch.
  
• Avg. Auto ABS OAS 76.0 -1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 41.3 +.02%
• 3-Month T-Bill Yield 5.38% -1.0 basis point
  

• China Iron Ore Spot 139.6 USD/Metric Tonne -1.1%
• Dutch TTF Nat Gas(European benchmark) 33.41 euros/megawatt-hour +1.9%

• Citi US Economic Surprise Index 6.4 +6.0 points

• Citi Eurozone Economic Surprise Index -30.4 +9.6 points

• Citi Emerging Markets Economic Surprise Index 15.5 +1.1 points
• S&P 500 Current Quarter EPS Growth Rate YoY(20 of 500 reporting) +9.0% -4.5 percentage points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 243.43 +.01:  Growth Rate +11.9% +.1 percentage point, P/E 19.4 unch.
  
• S&P 500 Current Year Estimated Profit Margin 12.05% +1.0 basis point
  
• 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 289.90 +.28: Growth Rate +35.9% +.1 percentage point, P/E 29.1 unch.
  
• Bloomberg US Financial Conditions Index n/a
  
• Bloomberg Euro-Zone Financial Conditions Index .33 -11.0 basis points
  
• US Yield Curve -39.75 basis points (2s/10s) +2.25 basis points
  
• US Atlanta Fed 4Q GDPNow Forecast +2.51% +48.0 basis points
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 65.7% -.1 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +3.02% unch.: CPI YoY +3.32% unch.
  
• 10-Year TIPS Spread 2.22 +2.0 basis points
  
• Highest target rate probability for March 20th FOMC meeting: 60.4%(-4.3 percentage points) chance of 5.0%-5.25%. Highest target rate probability for May 1st meeting: 49.4%(-7.0 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +48 open in Japan 
• China A50 Futures: Indicating -14 open in China

• DAX Futures: Indicating +102 open in Germany

Portfolio:

• Slightly Higher:  On gains in my biotech/transport sector longs and emerging market shorts
  

• Disclosed Trades: None
  

• Market Exposure: 25% Net Long