Stocks Lower into Final Hour on Mideast War Resumption Fears, Rising Fed Rate-Hike Odds, Higher Long-Term Rates, Alt Energy/Metals & Mining Sector Weakness

Economic/Market Gauges:

• North American Investment Grade CDS Index 54.4 +1.2%
• BofA Private Credit Proxy Index 71.7 -.2% 
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .29 unch.
• BofA Global Financial Stress Indicator -.10 +1.0 basis point
• European Financial Sector CDS Index 61.0 +1.2%
• Emerging Market CDS Index 162.5 +1.3%
• Israel Sovereign CDS 63.0 -2.1% 
• Bloomberg Global Trade Policy Uncertainty Index .7 unch.
• US Morning Consult Daily Consume Sentiment Index 89.4 +3.4

• Citi US Economic Surprise Index 45.3 +.2

• Citi Eurozone Economic Surprise Index -52.2 unch.

• Citi Emerging Markets Economic Surprise Index 32.1 +.5
• S&P 500 Current Quarter EPS Growth Rate YoY(455 of 500 reporting) +24.9% -.2 percentage point
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 355.64 +.35:  Growth Rate +28.3% +.1 percentage point, P/E 20.7 -.1
• S&P 500 Current Year Estimated Profit Margin 15.38% unch.
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(8 of 10 reporting) +62.1% unch.
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 865.81 +2.83: Growth Rate +118.7% +.7 percentage point, P/E 19.6 -.2 
• Bloomberg US Financial Conditions Index .98 unch.
• US Yield Curve 54.75 basis points (2s/10s) +1.25 basis points
• Bloomberg Industrial Metal Index 181.8 -.4%
• Dutch TTF Nat Gas(European benchmark) 52.0 euros/megawatt-hour +3.6%
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 12.0% -.9 percentage point
• US Atlanta Fed GDPNow Q2 Forecast +4.0% unch.
• US 10-Year T-Note Yield 4.66% +8.0 basis points
• 1-Year TIPS Spread 3.07 -5.0 basis points

• Highest target rate probability for July 29th FOMC meeting: 84.0% (-9.0 percentage points) chance of 3.5%-3.75%. Highest target rate probability for Sept. 16th meeting: 67.2%(-10.5 percentage points) chance of 3.5%-3.75%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +245 open in Japan 
• China A50 Futures: Indicating -149 open in China

• DAX Futures: Indicating -3 open in Germany

Portfolio:

• Slightly Higher: On gains in my energy/biotech sector longs, index hedges and emerging market shorts
• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges, then added them back
• Market Exposure: 50% Net Long