Monday, August 26, 2024

Stocks Finish Modestly Lower on Mid-East Regional War Fears, Sector Rotation, Technical Selling, Tech/Homebuilding Sector Weakness

Broad Equity Market Tone:

  • Advance/Decline Line: Around Even
  • Sector Performance: Most Sectors Declining
  • Volume: Below Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 16.0 +.7%
  • DJIA Intraday % Swing .58 -34.9%
  • Bloomberg Global Risk On/Risk Off Index 54.3 +2.7%
  • Euro/Yen Carry Return Index 177.9 -.3%
  • Emerging Markets Currency Volatility(VXY) 8.8 +1.3%
  • CBOE S&P 500 Implied Correlation Index 12.8 -1.3% 
  • ISE Sentiment Index 148.0 +20.0
  • Total Put/Call .93 -13.9%
  • NYSE Arms 1.03 +37.3%
  • NYSE Non-Block Money Flow +$118.1M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 49.4 +.5%
  • US Energy High-Yield OAS 293.0 -.78%
  • Bloomberg TRACE # Distressed Bonds Traded 246 -14
  • European Financial Sector CDS Index 60.0 +.44%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 162.5 +.57%
  • Italian/German 10Y Yld Spread 135.0 basis points +1.0 basis point
  • Asia Ex-Japan Investment Grade CDS Index 93.2 -1.7%
  • Emerging Market CDS Index 158.5 -.62%
  • Israel Sovereign CDS 138.2 +1.3%
  • China Corp. High-Yield Bond USD ETF(KHYB) 25.1 unch.
  • 2-Year SOFR Swap Spread -21.5 basis points -.75 basis point
  • Treasury Repo 3M T-Bill Spread -19.25 basis points -2.0 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -1.25 unch.
  • MBS  5/10 Treasury Spread 134.0 +1.0 basis point
  • Bloomberg CMBS Investment Grade Bbb Average OAS 695.0 unch.
  • Avg. Auto ABS OAS 66.0 -1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 39.1 -.06%
  • 3-Month T-Bill Yield 5.13% unch.
  • China Iron Ore Spot 100.2 USD/Metric Tonne -.2%
  • Dutch TTF Nat Gas(European benchmark) 37.7 euros/megawatt-hour +2.2%
  • Citi US Economic Surprise Index -31.1 +6.5 points
  • Citi Eurozone Economic Surprise Index -56.2 +3.7 points
  • Citi Emerging Markets Economic Surprise Index -14.2 -.6 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(477 of 500 reporting) +9.4% unch.
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 264.82 n/a:  Growth Rate +16.2% n/a, P/E 21.2 n/a
  • S&P 500 Current Year Estimated Profit Margin 12.65% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(8 of 10 reporting) +26.3% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 344.11 n/a: Growth Rate +28.3% n/a, P/E 32.3 n/a
  • Bloomberg US Financial Conditions Index .71 +4.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index .73 -2.0 basis points
  • US Yield Curve -12.0 basis points (2s/10s) unch.
  • US Atlanta Fed 3Q GDPNow Forecast +1.99% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 71.7% +.6 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.64% unch.: CPI YoY +2.59% unch.
  • 10-Year TIPS Spread 2.15 +3.0 basis points
  • Highest target rate probability for Nov. 7th FOMC meeting: 47.4%(+6.7 percentage points) chance of 4.75%-5.0%. Highest target rate probability for Dec. 18th meeting: 44.6%(+.7 percentage point) chance of 4.25%-4.5%.
Overseas Futures:
  • Nikkei 225 Futures: Indicating -10 open in Japan 
  • China A50 Futures: Indicating -32 open in China
  • DAX Futures: Indicating +66 open in Germany
Portfolio:
  • Slightly Higher:  On gains in my consumer discretionary/utility sector longs, index hedges and emerging market shorts
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

No comments: