Tuesday, October 21, 2025

Stocks Sightly Higher into Final Hour on Lower Long-Term Rates, Earnings Outlook Optimism, Technical Buying, Consumer Discretionary/Industrial Sector Strength

Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 36.2 -.4%
  • US 10-Year T-Note Yield 3.96% -2.0 basis points
  • 3-Month T-Bill Yield 3.87% -2.0 basis points
  • China Iron Ore Spot 103.9 USD/Metric Tonne +.33%
  • Dutch TTF Nat Gas(European benchmark) 32.2 euros/megawatt-hour +1.5%
  • Citi US Economic Surprise Index 11.1 +.3 point
  • Citi Eurozone Economic Surprise Index -4.1 -.6 point
  • Citi Emerging Markets Economic Surprise Index 10.6 +.6 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(78 of 500 reporting) +12.9% -2.1 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 296.47 +.11:  Growth Rate +13.2% unch., P/E 22.8 +.1
  • S&P 500 Current Year Estimated Profit Margin 13.48% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 482.18 +.61: Growth Rate +18.7% +.2 percentage point, P/E 34.1 +.1
  • Bloomberg US Financial Conditions Index .54 +11.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.28 +15.0 basis points
  • Bloomberg Global Trade Policy Uncertainty Index 3.9 -.6 point
  • US Yield Curve 50.5 basis points (2s/10s) -1.75 basis points
  • US Atlanta Fed GDPNow Q2 Forecast +3.9% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 39.8% +.2 percentage point
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.87% unch.: CPI YoY +2.99% unch.
  • 1-Year TIPS Spread 2.58 -2.0 basis points
  • 10-Year TIPS Spread 2.28 +2.0 basis points
  • Highest target rate probability for Dec. 10th FOMC meeting: 94.5% (-4.3 percentage points) chance of 3.5%-3.75%. Highest target rate probability for Jan. 28th meeting: 55.4%(+.4 percentage point) chance of 3.25%-3.5%. (current target rate is 4.0-4.25%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +210 open in Japan 
  • China A50 Futures: Indicating -89 open in China
  • DAX Futures: Indicating +102 open in Germany
Portfolio:
  • Slightly Higher: On gains in my tech/industrial/consumer discretionary sector longs 
  • Disclosed Trades: None
  • Market Exposure: 100% Net Long

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