Stocks Lower into Final Hour on Mideast War Resumption Fears, AI Infrastructure Build Out Worries, Profit-Taking, Tech/Alt Energy Sector Weakness

Economic/Market Gauges:

• North American Investment Grade CDS Index 55.1 +1.3%
• BofA Private Credit Proxy Index 75.5 +1.0% 
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .21 -2.0 basis points
• BofA Global Financial Stress Indicator -.03 -6.0 basis points
• European Financial Sector CDS Index 63.1 +.7%
• Emerging Market CDS Index 162.0 +.9%
• Israel Sovereign CDS 68.2 +2.6% 
• Bloomberg Global Trade Policy Uncertainty Index .4 -.1
• US Morning Consult Daily Consume Sentiment Index 89.8 +.6

• Citi US Economic Surprise Index 8.4 -.3

• Citi Eurozone Economic Surprise Index -53.7 -2.2

• Citi Emerging Markets Economic Surprise Index 41.9 +6.3
• S&P 500 Current Quarter EPS Growth Rate YoY(170 of 500 reporting) +24.0% -.8 percentage point
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 343.74 +.14:  Growth Rate +24.0% unch., P/E 20.7 -.1
• S&P 500 Current Year Estimated Profit Margin 15.10% -2.0 basis points
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(2 of 10 reporting) +314.5% unch.
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 823.81 +.28: Growth Rate +108.1% +.1 percentage point, P/E 19.6 -.3 
• Bloomberg US Financial Conditions Index .94 +7.0 basis points
• US Yield Curve 50.75 basis points (2s/10s) -2.75 basis points
• Bloomberg Industrial Metal Index 178.1 -.9%
• Dutch TTF Nat Gas(European benchmark) 43.3 euros/megawatt-hour -3.0% 
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 18.8% -1.1 percentage points
• US Atlanta Fed GDPNow Q1 Forecast +1.2% unch.
• US 10-Year T-Note Yield 4.35% +1.0 basis point
• 1-Year TIPS Spread 3.28 +3.0 basis points

• Highest target rate probability for June 17th FOMC meeting: 96.9% (+2.5 percentage points) chance of 3.5%-3.75%. Highest target rate probability for July 29th meeting: 90.7%(+2.3 percentage points) chance of 3.5%-3.75%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -677 open in Japan 
• China A50 Futures: Indicating -28 open in China

• DAX Futures: Indicating +105 open in Germany

Portfolio:

• Lower: On losses in my consumer discretionary/tech/industrial/biotech sector longs
• Disclosed Trades: Added to my (IWM)/(QQQ) hedges
• Market Exposure: Moved to 75% Net Long