Tuesday, February 20, 2024

Stocks Lower into Close on US Policy-Induced Stagflation Fears, Earnings Outlook Jitters, Technical Selling, Gambling/Alt Energy Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Most Sectors Declining
  • Volume: Around Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 15.6 +5.7%
  • DJIA Intraday % Swing .53 +.9%
  • Bloomberg Global Risk On/Risk Off Index 71.0 -2.3%
  • Euro/Yen Carry Return Index 175.3 +.2%
  • Emerging Markets Currency Volatility(VXY) 6.4 -1.8%
  • CBOE S&P 500 Implied Correlation Index 18.6 +9.6% 
  • ISE Sentiment Index 133.0 +11.0
  • Total Put/Call .94 -11.3%
  • NYSE Arms 1.26 +26.0% 
  • NYSE Non-Block Money Flow -$247.3M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 53.0 +.06%
  • US Energy High-Yield OAS 305.1 +.9%
  • Bloomberg TRACE # Distressed Bonds Traded 271 -23
  • European Financial Sector CDS Index 66.88 +.97% 
  • Deutsche Bank Subordinated 5Y Credit Default Swap 211.4 +.9%
  • Italian/German 10Y Yld Spread 149.0 basis points +1.0 basis point
  • Asia Ex-Japan Investment Grade CDS Index 98.9 -.44%
  • Emerging Market CDS Index 178.6 +.57%
  • Israel Sovereign CDS 113.9 -1.2%
  • China Corp. High-Yield Bond USD ETF(KHYB) 24.6 +.14%
  • 2-Year SOFR Swap Spread -12.75 basis points +.75 basis point
  • Treasury Repo 3M T-Bill Spread 6.25 basis points -1.25 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -5.25 -.5 basis point
  • MBS  5/10 Treasury Spread 157.0 -2.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 834.0 +1.0 basis point
  • Avg. Auto ABS OAS 65.0 -1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 40.3 +.01%
  • 3-Month T-Bill Yield 5.36% -1.0 basis point
  • China Iron Ore Spot 119.6 USD/Metric Tonne -1.0%
  • Dutch TTF Nat Gas(European benchmark) 24.2 euros/megawatt-hour +2.0%
  • Citi US Economic Surprise Index 40.3 -.1 point
  • Citi Eurozone Economic Surprise Index 34.3 -.4
  • Citi Emerging Markets Economic Surprise Index -2.5 -.4 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(402 of 500 reporting) +4.9% -.1 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 246.16 +.35:  Growth Rate +11.2% +.2 percentage point, P/E 20.2 -.3
  • S&P 500 Current Year Estimated Profit Margin 11.20% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +44.2% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 308.09 +2.15: Growth Rate +44.4% +.5 percentage point, P/E 31.0 -1.2
  • Bloomberg US Financial Conditions Index 1.11 +3.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index .45 -44.0 basis points
  • US Yield Curve -33.75 basis points (2s/10s) +2.25 basis points
  • US Atlanta Fed 1Q GDPNow Forecast +2.9% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 53.8% -.5 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.74% unch.: CPI YoY +3.06% unch.
  • 10-Year TIPS Spread 2.32 -1.0 basis point
  • Highest target rate probability for May 1st FOMC meeting: 62.0%(-7.7 percentage points) chance of 5.25%-5.5%. Highest target rate probability for June 12th meeting: 51.2%(-4.1 percentage points) chance of 5.0%-5.25%.
Overseas Futures:
  • Nikkei 225 Futures: Indicating -73 open in Japan 
  • China A50 Futures: Indicating -29 open in China
  • DAX Futures: Indicating +53 open in Germany
Portfolio:
  • Lower:  On losses in my tech/industrial/transport/biotech sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

No comments: