Thursday, January 30, 2025

Stocks Rising into Final Hour on Earnings Outlook Optimism, Dissipation of Overblown AI Infrastructure Fears, Lower Long-Term Rates, Tech/Consumer Discretionary Sector Strength

Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 37.2 +.2%
  • 3-Month T-Bill Yield 4.28% -1.0 basis point
  • China Iron Ore Spot 106.60 USD/Metric Tonne +1.2%
  • Dutch TTF Nat Gas(European benchmark) 51.7 euros/megawatt-hour +1.1%
  • Citi US Economic Surprise Index 9.4 +.7 point
  • Citi Eurozone Economic Surprise Index .3 -1.5 points
  • Citi Emerging Markets Economic Surprise Index 3.5 -3.8 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(152 of 500 reporting) +12.5% +1.9 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 274.74 -.09:  Growth Rate +15.4% unch., P/E 22.1 +.1
  • S&P 500 Current Year Estimated Profit Margin 12.20% -5.0 basis points
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(4 of 10 reporting) +26.5% -71.1 percentage points
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 400.22 +.11: Growth Rate +28.0% unch., P/E 33.7 -.4
  • Bloomberg US Financial Conditions Index .76 -2.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.81 +1.0 basis point
  • US Yield Curve 31.25 basis points (2s/10s) -1.25 basis points
  • US Atlanta Fed Q4 GDPNow Forecast +2.27% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 26.3% +.3 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.83% unch.: CPI YoY +2.85% unch.
  • 10-Year TIPS Spread 2.38 -3.0 basis points
  • Highest target rate probability for May 7th FOMC meeting: 57.0% (+1.0 percentage point) chance of 4.25%-4.5%. Highest target rate probability for June 18th meeting: 47.0%(+.7 percentage point) chance of 4.0%-4.25%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +222 open in Japan 
  • China A50 Futures: Indicating +151 open in China
  • DAX Futures: Indicating +173 open in Germany
Portfolio:
  • Higher: On gains in my utility/industrial/financial/consumer discretionary/tech sector longs
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

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