Tuesday, January 21, 2025

Stocks Surging into Final Hour on Earnings Outlook Optimism, Falling Long-Term Rates, Short-Covering, Tech/Biotech Sector Strength

Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 37.0 +.04%
  • 3-Month T-Bill Yield 4.30% unch.
  • China Iron Ore Spot 103.9 USD/Metric Tonne -.9%
  • Dutch TTF Nat Gas(European benchmark) 50.02 euros/megawatt-hour +4.5%
  • Citi US Economic Surprise Index 20.6 -2.2 points
  • Citi Eurozone Economic Surprise Index -24.2 -4.3 points
  • Citi Emerging Markets Economic Surprise Index 8.7 +3.1 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(47 of 500 reporting) +20.1% -1.8 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 274.28 +.54:  Growth Rate +15.1% +.2 percentage point, P/E 22.0 +.1
  • S&P 500 Current Year Estimated Profit Margin 12.28% -8.0 basis points
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 396.95 +.62: Growth Rate +26.6% +.2 percentage point, P/E 33.7 +.3
  • Bloomberg US Financial Conditions Index .79 +7.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 2.23 +60.0 basis points
  • US Yield Curve 29.0 basis points (2s/10s) -5.0 basis points
  • US Atlanta Fed Q4 GDPNow Forecast +2.99% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 24.6% -1.2 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.83% unch.: CPI YoY +2.82% unch.
  • 10-Year TIPS Spread 2.40 -2.0 basis points
  • Highest target rate probability for March 19th FOMC meeting: 73.6% (+1.2 percentage points) chance of 4.25%-4.5%. Highest target rate probability for May 7th meeting: 57.2%(+.9 percentage point) chance of 4.25%-4.5%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +280 open in Japan 
  • China A50 Futures: Indicating -89 open in China
  • DAX Futures: Indicating +192 open in Germany
Portfolio:
  • Higher: On gains in my industrial/financial/tech/utility/consumer discretionary sector longs
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

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