Monday, April 14, 2025

Stocks Rising into Final Hour on Lower Long-Term Rates, Diminished Global Trade War Fears, Short-Covering, Biotech/Utility Sector Strength

Broad Equity Market Tone:

  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Almost Every Sector Falling
  • Volume: Heavy
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 42.5 +26.5%
  • S&P 500 Intraday % Swing 3.8 +82.8%
  • Bloomberg Global Risk On/Risk Off Index 48.0 -8.6%
  • Euro/Yen Carry Return Index 182.1 +1.4%
  • Emerging Markets Currency Volatility(VXY) 9.7 -3.8%
  • CBOE S&P 500 Implied Correlation Index 46.0 +17.1% 
  • ISE Sentiment Index 108.0 -21.0 points
  • Total Put/Call 1.10 +4.8%
  • NYSE Arms .89 +423.5%
  • NYSE Non-Block Money Flow -$285.1M 
Credit Investor Angst:
  • North American Investment Grade CDS Index 71.8 +5.7%
  • US Energy High-Yield OAS 533.1 +4.6%
  • Bloomberg TRACE # Distressed Bonds Traded 330.0 -18.0
  • European Financial Sector CDS Index 81.9 -10.6%
  • Deutsche Bank Subordinated 5Y Credit Default Swap 188.5 -10.8%
  • Italian/German 10Y Yld Spread 121.0 basis points -8.0 basis points
  • Asia Ex-Japan Investment Grade CDS Index 113.0 -11.0%
  • Emerging Market CDS Index 212.3 +5.3%
  • Israel Sovereign CDS 118.8 -1.8%
  • China Corp. High-Yield Bond USD ETF(KHYB) 23.0 -1.6%
  • 2-Year SOFR Swap Spread -25.0 basis points -3.0 basis points
  • 3M T-Bill Treasury Repo Spread -8.75 basis points -5.25 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -3.5 +.75 basis point
  • MBS  5/10 Treasury Spread 158.0 +3.0 basis points
  • Bloomberg CMBS Investment Grade Bbb Average OAS 639.0 -1.0 basis points
  • Avg. Auto ABS OAS 66.0 +1.0 basis point
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 36.7 +.3% 
  • US 10-Year T-Note Yield 4.37% -12.0 basis points
  • 3-Month T-Bill Yield 4.30% -1.0 basis point
  • China Iron Ore Spot 97.9 USD/Metric Tonne -.23%
  • Dutch TTF Nat Gas(European benchmark) 34.5 euros/megawatt-hour +3.1%
  • Citi US Economic Surprise Index -18.3 -.5 point
  • Citi Eurozone Economic Surprise Index 8.7 -1.5 points
  • Citi Emerging Markets Economic Surprise Index 9.2 +5.7 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(30 of 500 reporting) +7.4% n/a
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 277.34 n/a:  Growth Rate +12.9% n/a, P/E 19.4 n/a
  • S&P 500 Current Year Estimated Profit Margin 13.49% -1.0 basis point
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 418.21 n/a: Growth Rate +20.9% n/a, P/E 27.5 n/a
  • Bloomberg US Financial Conditions Index -.81 +8.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index .42 -24.0 basis points
  • US Yield Curve 52.25 basis points (2s/10s) unch.
  • US Atlanta Fed GDPNow Q1 Forecast -2.4% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 38.0% +2.25 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.54% unch.: CPI YoY +2.42% unch.
  • 10-Year TIPS Spread 2.24 +3.0 basis points
  • Highest target rate probability for June 18th FOMC meeting: 64.3% (-.1 percentage point) chance of 4.0%-4.25%. Highest target rate probability for July 30th meeting: 50.2%(+1.9 percentage points) chance of 3.75%-4.0%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +560 open in Japan 
  • China A50 Futures: Indicating -21 open in China
  • DAX Futures: Indicating +123 open in Germany
Portfolio:
  • Higher: On gains in my tech/industrial/consumer discretionary/utility sector longs
  • Disclosed Trades: None
  • Market Exposure: 75% net long

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