Wednesday, July 22, 2026

Stocks Reversing Slightly Lower into Final Hour on Mideast War Escalation Fears, Rising Long-Term Rates, Oil Gain, Transport/Healthcare Sector Weakness

Economic/Market Gauges:

  • North American Investment Grade CDS Index 52.0 +.6%
  • BofA Private Credit Proxy Index 68.8 -1.2% 
  • Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .30 unch.
  • BofA Global Financial Stress Indicator -.12 -2.0 basis points
  • European Financial Sector CDS Index 55.3 +.2%
  • Emerging Market CDS Index 144.7 +.5%
  • Israel Sovereign CDS 66.0 +.3% 
  • Bloomberg Global Trade Policy Uncertainty Index .8 +.1
  • US Morning Consult Daily Consume Sentiment Index 91.8 +3.5
  • Citi US Economic Surprise Index 47.5 -1.1
  • Citi Eurozone Economic Surprise Index 21.6 +1.1
  • Citi Emerging Markets Economic Surprise Index 20.8 -.5
  • S&P 500 Current Quarter EPS Growth Rate YoY(79 of 500 reporting) +42.4% -5.0 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 376.70 +.49:  Growth Rate +27.6% +.1 percentage point, P/E 20.0 unch.
  • S&P 500 Current Year Estimated Profit Margin 15.69% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(2 of 10 reporting) +510.0% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 910.83 +1.82: Growth Rate +75.6% +.3 percentage point, P/E 19.1 -.1 
  • Bloomberg US Financial Conditions Index 1.15 +9.0 basis points
  • US Yield Curve 35.25 basis points (2s/10s) -1.25 basis points
  • Bloomberg Industrial Metal Index 176.8 +.3%
  • Dutch TTF Nat Gas(European benchmark) 62.6 euros/megawatt-hour +4.9%
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 13.3% -.8 percentage point
  • US Atlanta Fed GDPNow Q2 Forecast +1.7% unch.
  • US 10-Year T-Note Yield 4.66% +3.0 basis points
  • 1-Year TIPS Spread 1.14 -4.0 basis points
  • Highest target rate probability for September 29th FOMC meeting: 54.9% (+.4 percentage point) chance of 3.75%-4.0%. Highest target rate probability for Oct. 28th meeting: 45.1%(-2.4 percentage points) chance of 3.75%-4.0%. (current target rate is 3.5-3.75%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +410 open in Japan 
  • China A50 Futures: Indicating -54 open in China
  • KOSPI 200 Futures: Indicating +20 open in South Korea 
  • DAX Futures: Indicating +90 open in Germany
Portfolio:
  • Higher: On gains in my tech/industrial/consumer discretionary sector longs and index hedges
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges 
  • Market Exposure: Moved to 75% net long

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