Friday, February 02, 2024

Stocks Rising into Afternoon on Earnings Outlook Optimism, US Economic Data, Technical Buying, Tech/Transport Sector Strength

Broad Equity Market Tone:

  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Mixed
  • Volume: Above Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 14.0 +.6%
  • DJIA Intraday % Swing .74 -.69%
  • Bloomberg Global Risk On/Risk Off Index 57.5 +2.6%
  • Euro/Yen Carry Return Index 172.7 +.52%
  • Emerging Markets Currency Volatility(VXY) 7.2 +.3%
  • CBOE S&P 500 Implied Correlation Index 19.7 +7.3% 
  • ISE Sentiment Index 149.0 unch.
  • Total Put/Call .96 -4.0%
  • NYSE Arms .95 -31.2% 
  • NYSE Non-Block Money Flow -$158.3M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 55.23 -.3%
  • US Energy High-Yield OAS 319.99 -2.7%
  • Bloomberg TRACE # Distressed Bonds Traded 326 -5
  • European Financial Sector CDS Index 69.1 -2.3% 
  • Deutsche Bank Subordinated 5Y Credit Default Swap 206.4 -1.2%
  • Italian/German 10Y Yld Spread 158.0 basis points unch.
  • Asia Ex-Japan Investment Grade CDS Index 100.71 -1.9%
  • Emerging Market CDS Index 179.4 +1.2%
  • Israel Sovereign CDS 132.3 +2.2%
  • China Corp. High-Yield Bond USD ETF(KHYB) 24.49 +.08%
  • 2-Year SOFR Swap Spread -13.0 basis points +1.5 basis points
  • Treasury Repo 3M T-Bill Spread 6.0 basis points +.75 basis point
  • 3-Month EUR/USD Cross-Currency Basis Swap -8.5 +.25 basis point
  • MBS  5/10 Treasury Spread 150.0 +11.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 873.0 -14.0 basis points
  • Avg. Auto ABS OAS 71.0 +1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 40.7 -.5%
  • 3-Month T-Bill Yield 5.37% +1.0 basis point
  • China Iron Ore Spot 127.0 USD/Metric Tonne +.6%
  • Dutch TTF Nat Gas(European benchmark) 29.3 euros/megawatt-hour +1.1%
  • Citi US Economic Surprise Index 39.5 +8.8 points
  • Citi Eurozone Economic Surprise Index 7.0 +2.6 points
  • Citi Emerging Markets Economic Surprise Index -2.4 +2.5 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(230 of 500 reporting) +4.4% +4.4 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 244.14 +.11:  Growth Rate +10.3% +.1 percentage point, P/E 20.3 +.3
  • S&P 500 Current Year Estimated Profit Margin 11.44% -5.0 basis points
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +44.2% +13.1 percentage points
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 295.82 +.14: Growth Rate +38.7% +.1 percentage point, P/E 32.3 +1.5
  • Bloomberg US Financial Conditions Index .90 +5.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index .65 +5.0 basis points
  • US Yield Curve -34.25 basis points (2s/10s) -.5 basis point
  • US Atlanta Fed 1Q GDPNow Forecast +4.2% +1.2 percentage points
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 64.2% -3.4 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.66% unch.: CPI YoY +2.96% unch.
  • 10-Year TIPS Spread 2.21 +2.0 basis points
  • Highest target rate probability for May 1st FOMC meeting: 56.2%(-3.4 percentage points) chance of 5.0%-5.25%. Highest target rate probability for June 12th meeting: 52.2%(+1.9 percentage points) chance of 4.75%-5.0%.
Overseas Futures:
  • Nikkei 225 Futures: Indicating +200 open in Japan 
  • China A50 Futures: Indicating -99 open in China
  • DAX Futures: Indicating +97 open in Germany
Portfolio:
  • Higher:  On gains in my consumer discretionary/industrial/tech sector longs
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

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