Stocks Slightly Lower into Final Hour on Higher Long-Term Rates, Rotation From FANG, Technical Selling, Consumer Discretionary/Healthcare Provider Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Most Sectors Rising

• Volume: Above Average

• Market Leading Stocks: Outperforming

Equity Investor Angst:

• Volatility(VIX) 15.8 +2.9%
• S&P 500 Intraday % Swing .27 -14.2%.
  
• Bloomberg Global Risk On/Risk Off Index 77.2 +.8%

• Euro/Yen Carry Return Index 177.5 -.08%

• Emerging Markets Currency Volatility(VXY) 8.83 -1.5%

• CBOE S&P 500 Implied Correlation Index 12.5 +3.1% 

• ISE Sentiment Index 180.0 -12.0 points
  

• Total Put/Call .74 -43.5%

• NYSE Arms .75 -50.0%
  
• NYSE Non-Block Money Flow -$194.8M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 46.8 +.2%
  

• US Energy High-Yield OAS 287.4 -1.1%
• Bloomberg TRACE # Distressed Bonds Traded 174.0 -10

• European Financial Sector CDS Index 55.60 -.9%
  
• Deutsche Bank Subordinated 5Y Credit Default Swap 134.4 -1.6%
  

• Italian/German 10Y Yld Spread 105.0 basis points -5.0 basis points

• Asia Ex-Japan Investment Grade CDS Index 65.9 -4.4%
  

• Emerging Market CDS Index 150.6 +.02%
• Israel Sovereign CDS 88.1 +.2%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.1 -.1%

• 2-Year SOFR Swap Spread -15.0 basis points +.25 basis point

• 3M T-Bill Treasury Repo Spread .5 basis point +1.25 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -.75 unch.
• MBS  5/10 Treasury Spread 131.0 -3.0 basis points
• Bloomberg CMBS Investment Grade Bbb Average OAS 599.0 -4.0 basis points
• Avg. Auto ABS OAS 47.0 unch.

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 37.3 +.08%
• 3-Month T-Bill Yield 4.31% unch.

• China Iron Ore Spot 107.3 USD/Metric Tonne +.5%
• Dutch TTF Nat Gas(European benchmark) 49.2 euros/megawatt-hour +2.2%

• Citi US Economic Surprise Index .4 +.9 point

• Citi Eurozone Economic Surprise Index 26.0 +11.0 points

• Citi Emerging Markets Economic Surprise Index 3.5 -2.1 points
• S&P 500 Current Quarter EPS Growth Rate YoY(391 of 500 reporting) +10.6% +.2 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 275.14 +.15:  Growth Rate +16.1% +.1 percentage point, P/E 22.2 unch.
• S&P 500 Current Year Estimated Profit Margin 11.84% +3.0 basis points
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +26.6% unch.
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 405.22 +.69: Growth Rate +31.0% +.2 percentage point, P/E 34.3 -.3
• Bloomberg US Financial Conditions Index .81 -2.0 basis points
• Bloomberg Euro-Zone Financial Conditions Index 2.13 +53.0 basis points
• US Yield Curve 24.25 basis points (2s/10s) +2.75 basis points
• US Atlanta Fed GDPNow Q1 Forecast +2.34% unch.
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 25.0% -.7 percentage point

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.66% unch.: CPI YoY +2.81% unch.
• 10-Year TIPS Spread 2.46 +2.0 basis points
• Highest target rate probability for May 7th FOMC meeting: 84.1% (+3.1 percentage points) chance of 4.25%-4.5%. Highest target rate probability for June 18th meeting: 54.2%(+4.6 percentage points) chance of 4.25%-4.5%. (current target rate is 4.25-4.5%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating unch. open in Japan 
• China A50 Futures: Indicating +3 open in China

• DAX Futures: Indicating +80 open in Germany

Portfolio:

• Higher: On gains in my tech/financial/utility/industrial sector longs
• Disclosed Trades: None
• Market Exposure: 100% Net Long