Monday, June 22, 2026

Stocks Reversing Lower into Final Hour on Higher Long-Term Rates, Sector Rotation, Technical Selling, Tech/Consumer Discretionary Sector Weakness

Economic/Market Gauges:

  • North American Investment Grade CDS Index 50.3 -.1%
  • BofA Private Credit Proxy Index 67.8 -1.3% 
  • Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .26 +3.0 basis points
  • BofA Global Financial Stress Indicator -.27 unch.
  • European Financial Sector CDS Index 54.0 -.9%
  • Emerging Market CDS Index 140.47 -1.3%
  • Israel Sovereign CDS 52.3 +.1% 
  • Bloomberg Global Trade Policy Uncertainty Index .5 +.1
  • US Morning Consult Daily Consume Sentiment Index 88.2 -2.1
  • Citi US Economic Surprise Index 47.5 -1.2
  • Citi Eurozone Economic Surprise Index -26.1 +.4
  • Citi Emerging Markets Economic Surprise Index 40.5 -.7
  • S&P 500 Current Quarter EPS Growth Rate YoY(5 of 500 reporting) +16.1% -2.7 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 366.75 +1.47:  Growth Rate +24.7% +.5 percentage point, P/E 20.4 -.2
  • S&P 500 Current Year Estimated Profit Margin 15.52% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 935.83 +16.68: Growth Rate +80.5% +3.3 percentage points, P/E 18.3 -.6 
  • Bloomberg US Financial Conditions Index 1.14 -1.0 basis point
  • US Yield Curve 27.0 basis points (2s/10s) -1.5 basis points
  • Bloomberg Industrial Metal Index 179.7 -.6%
  • Dutch TTF Nat Gas(European benchmark) 42.20 euros/megawatt-hour +.2%
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 13.1% -1.7 percentage points
  • US Atlanta Fed GDPNow Q2 Forecast +3.0% unch.
  • US 10-Year T-Note Yield 4.51% +5.0 basis points
  • 1-Year TIPS Spread 1.78 -9.0 basis points
  • Highest target rate probability for September 16th FOMC meeting: 51.6% (+1.7 percentage points) chance of 3.75%-4.0%. Highest target rate probability for Oct. 28th meeting: 43.8%(-1.1 percentage points) chance of 3.75%-4.0%. (current target rate is 3.5-3.75%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +720 open in Japan 
  • China A50 Futures: Indicating -70 open in China
  • DAX Futures: Indicating +125 open in Germany
Portfolio:
  • Higher: On gains in my industrial/financial/biotech sector longs and index hedges
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

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