Tuesday, January 14, 2025

Stocks Reversing Slightly Lower into Final Hour on Earnings Outlook Jitters, Fed Policy Mistake Worries, Ongoing Rotation from "Growth" to "Value", Consumer Discretionary/Pharma Sector Weakness

Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 36.9 +.2%
  • 3-Month T-Bill Yield 4.31% -1.0 basis point
  • China Iron Ore Spot 100.5 USD/Metric Tonne +.16%
  • Dutch TTF Nat Gas(European benchmark) 47.0 euros/megawatt-hour -2.7%
  • Citi US Economic Surprise Index 13.3 +.2 point
  • Citi Eurozone Economic Surprise Index -19.3 +.3 point
  • Citi Emerging Markets Economic Surprise Index 3.3 unch.
  • S&P 500 Current Quarter EPS Growth Rate YoY(22 of 500 reporting) +20.2% unch.
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 273.08 -.03:  Growth Rate +14.6% unch., P/E 21.3 +.1
  • S&P 500 Current Year Estimated Profit Margin 12.59% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 395.53 +.22: Growth Rate +26.2% +.1 percentage point, P/E 32.4 -.1
  • Bloomberg US Financial Conditions Index .63 unch.
  • Bloomberg Euro-Zone Financial Conditions Index 1.45 -8.0 basis points
  • US Yield Curve 42.25 basis points (2s/10s) +3.0 basis points
  • US Atlanta Fed Q4 GDPNow Forecast +2.73% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 20.1% +.6 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.87% unch.: CPI YoY +2.86% unch.
  • 10-Year TIPS Spread 2.46 -1.0 basis point
  • Highest target rate probability for March 19th FOMC meeting: 77.9% (-2.3 percentage points) chance of 4.25%-4.5%. Highest target rate probability for May 7th meeting: 64.7%(-4.1 percentage points) chance of 4.25%-4.5%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +356 open in Japan 
  • China A50 Futures: Indicating -39 open in China
  • DAX Futures: Indicating +145 open in Germany
Portfolio:
  • Slightly Higher: On gains in my industrial/financial/tech/utility sector longs
  • Disclosed Trades: None
  • Market Exposure: Moved to 50% Net Long

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