Monday, May 12, 2025

Stocks Soaring into Final Hour on US Global Trade Deal Hopes, Plunging US Recession Odds, Short-Covering, Tech/Consumer Discretionary Sector Strength

Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 36.86 -.23% 
  • US 10-Year T-Note Yield 4.46% +8.0 basis points
  • 3-Month T-Bill Yield 4.39% +7.0 basis points
  • China Iron Ore Spot 99.4 USD/Metric Tonne -.7%
  • Dutch TTF Nat Gas(European benchmark) 35.4 euros/megawatt-hour +2.2%
  • Citi US Economic Surprise Index -5.3 +.5 point
  • Citi Eurozone Economic Surprise Index 10.5 -.1 point
  • Citi Emerging Markets Economic Surprise Index 26.8 +1.4 points
  • S&P 500 Current Quarter EPS Growth Rate YoY(453 of 500 reporting) +12.3% unch.
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 276.34 +.35:  Growth Rate +12.1% +.2 percentage point, P/E 21.0 +.5
  • S&P 500 Current Year Estimated Profit Margin 13.33% +1.0 basis point
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(7 of 10 reporting) +29.1% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 424.78 +.88: Growth Rate +22.8% +.2 percentage point, P/E 30.8 +.7
  • Bloomberg US Financial Conditions Index .08 +3.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.19 +8.0 basis points
  • Bloomberg Global Trade Policy Uncertainty Index 8.9 -.6 point
  • US Yield Curve 45.5 basis points (2s/10s) -4.5 basis points
  • US Atlanta Fed GDPNow Q2 Forecast +2.3% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 36.2% -5.4 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.61% unch.: CPI YoY +2.34% unch.
  • 1-Year TIPS Spread 2.86 -26.0 basis points
  • 10-Year TIPS Spread 2.31 unch.
  • Highest target rate probability for July 30th FOMC meeting: 59.6% (+19.6 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Sept. 17th meeting: 52.2%(+8.9 percentage points) chance of 4.0%-4.25%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +1,120 open in Japan 
  • China A50 Futures: Indicating +79 open in China
  • DAX Futures: Indicating +140 open in Germany
Portfolio:
  • Higher: On gains in my consumer discretionary/utility/technology/industrial sector longs
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

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