Monday, December 02, 2024

Stocks Rising into Final Hour on US Economic Data, Earnings Outlook Optimism, Stable Long-Term Rates, Tech/Gambling Sector Strength

Broad Equity Market Tone:

  • Advance/Decline Line: Around Even
  • Sector Performance: Mixed
  • Volume: Above Average
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 13.6 +.9%
  • DJIA Intraday % Swing .70 unch.
  • Bloomberg Global Risk On/Risk Off Index 64.5 +3.0%
  • Euro/Yen Carry Return Index 174.5 -.9%
  • Emerging Markets Currency Volatility(VXY) 8.9 +2.1%
  • CBOE S&P 500 Implied Correlation Index 12.3 +1.7% 
  • ISE Sentiment Index 195.0 +22.0 points
  • Total Put/Call .81 -8.0%
  • NYSE Arms 1.40 -18.5%
  • NYSE Non-Block Money Flow -$110.4M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 47.5 -.2%
  • US Energy High-Yield OAS 288.7 -.3%
  • Bloomberg TRACE # Distressed Bonds Traded 175 -13
  • European Financial Sector CDS Index 63.5 +1.1%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 161.7 +.7%
  • Italian/German 10Y Yld Spread 123.0 basis points +3.0 basis points
  • Asia Ex-Japan Investment Grade CDS Index 72.8 -.7%
  • Emerging Market CDS Index 156.3 -.14%
  • Israel Sovereign CDS 108.7 -1.1%
  • China Corp. High-Yield Bond USD ETF(KHYB) 24.8 +.05%
  • 2-Year SOFR Swap Spread -17.5 basis points -3.5 basis points
  • 3M T-Bill Treasury Repo Spread -9.0 basis points -2.75 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -3.75 -1.0 basis point
  • MBS  5/10 Treasury Spread 136.0 -2.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 646.0 unch.
  • Avg. Auto ABS OAS 45.0 -2.0 basis points
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 37.3 -.3%
  • 3-Month T-Bill Yield 4.49% -1.0 basis point
  • China Iron Ore Spot 105.0 USD/Metric Tonne +.3%
  • Dutch TTF Nat Gas(European benchmark) 48.7 euros/megawatt-hour +1.8%
  • Citi US Economic Surprise Index 34.3 +4.3 points
  • Citi Eurozone Economic Surprise Index -24.3 -2.5 points
  • Citi Emerging Markets Economic Surprise Index .3 -1.0 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(485 of 500 reporting) +8.2% unch.
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 270.22 +.26:  Growth Rate +13.3% +.1 percentage point, P/E 22.4 +.1
  • S&P 500 Current Year Estimated Profit Margin 12.59% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(9 of 10 reporting) +33.3% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 383.37 +1.36: Growth Rate +22.4% +1.0 percentage point, P/E 32.8 +.1 point
  • Bloomberg US Financial Conditions Index .83 +2.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.04 -24.0 basis points
  • US Yield Curve -.5 basis point (2s/10s) -1.0 basis point
  • US Atlanta Fed Q4 GDPNow Forecast +3.16% +58.0 basis points
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 34.7% -.6 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.94% +18.0 basis points: CPI YoY +2.70% unch.
  • 10-Year TIPS Spread 2.27 +1.0 basis point
  • Highest target rate probability for Jan. 29th FOMC meeting: 57.7%(-.1 percentage point) chance of 4.25%-4.5%. Highest target rate probability for March 19th meeting: 42.9%(+3.3 percentage points) chance of 4.25%-4.5%. (current target rate is 4.5-4.75%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +177 open in Japan 
  • China A50 Futures: Indicating +3 open in China
  • DAX Futures: Indicating +51 open in Germany
Portfolio:
  • Slightly Higher:  On gains in my tech/consumer discretionary sector longs
  • Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 100% Net Long

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