Monday, May 11, 2026

Stocks Slightly Higher into Final Hour on Earnings Outlook Optimism, Technical Buying, Short-Covering, Tech/Alt Energy Sector Strength

Economic/Market Gauges:

  • North American Investment Grade CDS Index 53.1 +.4%
  • BofA Private Credit Proxy Index 73.9 -2.2% 
  • Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .22 unch.
  • BofA Global Financial Stress Indicator -.13 -4.0 basis points
  • European Financial Sector CDS Index 59.0 -.6%
  • Emerging Market CDS Index 156.4 +.6%
  • Israel Sovereign CDS 63.0 -.8% 
  • Bloomberg Global Trade Policy Uncertainty Index .8 -.1
  • US Morning Consult Daily Consume Sentiment Index 86.7 -1.6
  • Citi US Economic Surprise Index 36.4 +1.7
  • Citi Eurozone Economic Surprise Index -57.9 -9
  • Citi Emerging Markets Economic Surprise Index 49.9 -3.3
  • S&P 500 Current Quarter EPS Growth Rate YoY(447 of 500 reporting) +25.3% -.2 percentage point
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 353.68 +1.53:  Growth Rate +27.6% +.5 percentage point, P/E 21.0 +.1
  • S&P 500 Current Year Estimated Profit Margin 15.42% +6.0 basis points
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(8 of 10 reporting) +62.1% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 852.97 +2.54: Growth Rate +115.4% +.6 percentage point, P/E 20.4 +.5 
  • Bloomberg US Financial Conditions Index 1.17 +14.0 basis points
  • US Yield Curve 46.0 basis points (2s/10s) -1.5 basis points
  • Bloomberg Industrial Metal Index 185.0 +2.2%
  • Dutch TTF Nat Gas(European benchmark) 46.6 euros/megawatt-hour +5.6% 
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 17.0% -.8 percentage point
  • US Atlanta Fed GDPNow Q2 Forecast +3.7% unch.
  • US 10-Year T-Note Yield 4.41% +6.0 basis points
  • 1-Year TIPS Spread 3.10 +10.0 basis points
  • Highest target rate probability for July 29th FOMC meeting: 93.6% (+6.2 percentage points) chance of 3.5%-3.75%. Highest target rate probability for Sept. 16th meeting: 89.2%(+2.8 percentage points) chance of 3.5%-3.75%. (current target rate is 3.5-3.75%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +440 open in Japan 
  • China A50 Futures: Indicating +30 open in China
  • DAX Futures: Indicating -29 open in Germany
Portfolio:
  • Higher: On gains in my tech/industrial/energy sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 75% Net Long

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