Stocks Modestly Higher into Final Hour on Earnings Outlook Optimism, US Economic Data, Short-Covering, Commodity/Financial Sector Strength

Economic/Market Gauges:

• North American Investment Grade CDS Index 50.5 -.6%
• BofA Private Credit Proxy Index 73.9 +.4% 
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .32 unch.
• BofA Global Financial Stress Indicator -.15 +2.0 basis points
• European Financial Sector CDS Index 54.5 unch.
• Emerging Market CDS Index 138.5 -.7%
• Israel Sovereign CDS 53.0 +1.1%
• Bloomberg Global Trade Policy Uncertainty Index .8 -.2
• US Morning Consult Daily Consume Sentiment Index 86.4 -1.1

• Citi US Economic Surprise Index 16.7 +.4

• Citi Eurozone Economic Surprise Index 72.9 +.6

• Citi Emerging Markets Economic Surprise Index 23.0 -1.2
• S&P 500 Current Quarter EPS Growth Rate YoY(488 of 500 reporting) +52.5% +.5 percentage point
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 397.24 +.31:  Growth Rate +21.1% +.1 percentage point, P/E 19.3 unch.
• S&P 500 Current Year Estimated Profit Margin 16.28% -1.0 basis point
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(9 of 10 reporting) +133.3% unch.
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 970.51 +2.20: Growth Rate +87.1% +.4 percentage point, P/E 19.1 -.2
• Bloomberg US Financial Conditions Index 1.23 -10.0 basis points
• US Yield Curve 40.25 basis points (2s/10s) -.5 basis point
• Bloomberg Industrial Metal Index 179.5 -2%
• Dutch TTF Nat Gas(European benchmark) 73.3 euros/megawatt-hour +1.5%
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 12.0 -.3 percentage point
• US Atlanta Fed GDPNow Q3 Forecast +4.8% unch.
• US 10-Year T-Note Yield 4.80% unch.
• 1-Year TIPS Spread 2.27 -2.0 basis points

• Highest target rate probability for Oct. 28th FOMC meeting: 56.0% (-1.7 percentage points) chance of 3.75%-4.0%. Highest target rate probability for Dec. 9th meeting: 41.3%(-1.9 percentage points) chance of 4.0%-4.25%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +230 open in Japan 
• China A50 Futures: Indicating -41 open in China
• KOSPI 200 Futures: Indicating +12 open in South Korea 

• DAX Futures: Indicating +25 open in Germany

Portfolio:

• Slightly Lower: On losses in my tech sector longs and index hedges
• Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges
• Market Exposure: Moved to 50% net long