Monday, July 13, 2026

Stocks Lower into Final Hour on Mideast War Resumption, More Hawkish Fed Commentary, Higher Long-Term Rates, Tech/Airline Sector Weakness

Economic/Market Gauges:

  • North American Investment Grade CDS Index 51.9 +1.5%
  • BofA Private Credit Proxy Index 69.6 -.7% 
  • Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .28 unch.
  • BofA Global Financial Stress Indicator -.20 -1.0 basis point
  • European Financial Sector CDS Index 54.8 +.9%
  • Emerging Market CDS Index 142.30 +1.7%
  • Israel Sovereign CDS 59.4 +7.3% 
  • Bloomberg Global Trade Policy Uncertainty Index .6 +.1
  • US Morning Consult Daily Consume Sentiment Index 88.9 -1.4
  • Citi US Economic Surprise Index 55.0 -3.5
  • Citi Eurozone Economic Surprise Index 5.6 +2.
  • Citi Emerging Markets Economic Surprise Index 34.0 -.7
  • S&P 500 Current Quarter EPS Growth Rate YoY(17 of 500 reporting) +136.8% -11.6 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 373.44 +.86:  Growth Rate +26.9% +.3 percentage point, P/E 20.3 +.1
  • S&P 500 Current Year Estimated Profit Margin 15.63% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(1 of 10 reporting) +1,226.6% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 897.75 +4.82: Growth Rate +74.0% +.9 percentage point, P/E 19.4 +.1 
  • Bloomberg US Financial Conditions Index 1.24 +5.0 basis points
  • US Yield Curve 34.75 basis points (2s/10s) -3.0 basis points
  • Bloomberg Industrial Metal Index 173.07 -.07%
  • Dutch TTF Nat Gas(European benchmark) 52.2 euros/megawatt-hour +7.3%
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 14.0% -.8 percentage point
  • US Atlanta Fed GDPNow Q2 Forecast +1.3% unch.
  • US 10-Year T-Note Yield 4.61% +5.0 basis points
  • 1-Year TIPS Spread 1.38 +7.0 basis points
  • Highest target rate probability for September 29th FOMC meeting: 51.3% (+.1 percentage point) chance of 3.75%-4.0%. Highest target rate probability for Oct. 28th meeting: 43.6%(-3.0 percentage points) chance of 3.75%-4.0%. (current target rate is 3.5-3.75%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +305 open in Japan 
  • China A50 Futures: Indicating -38 open in China
  • KOSPI 200 Futures: Indicating +20 open in South Korea 
  • DAX Futures: Indicating +10 open in Germany
Portfolio:
  • Slightly Lower: On losses in my tech/industrial sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
  • Market Exposure: Moved to 50% Net Long

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