Stocks Higher into Final Hour on US Economic Soft-Landing Hopes, Less European/Emerging Markets/US High-Yield Debt Angst, Dollar Weakness, Tech/Alt Energy Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Slightly Higher
  

• Sector Performance: Most Sectors Rising
  

• Volume:  Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 19.4 +1.3%
• DJIA Intraday % Swing .68%
  
• Bloomberg Global Risk On/Risk Off Index 54.3 +2.5%

• Euro/Yen Carry Return Index 150.6 +.22%

• Emerging Markets Currency Volatility(VXY) 12.1 +.08%

• CBOE S&P 500 Implied Correlation Index 34.8 +.17% 

• ISE Sentiment Index 112.0 +30.0 points
  

• Total Put/Call .96 -2.0%

• NYSE Arms 1.08 +77.1%

Credit Investor Angst:

• North American Investment Grade CDS Index 78.7 -2.7%
  

• US Energy High-Yield OAS 405.3 -1.84%
• Bloomberg TRACE # Distressed Bonds Traded 458.0 -15
  

• European Financial Sector CDS Index 103.11 -3.2% 
• Deutsche Bank Subordinated 5Y Credit Default Swap 365.978 -23.0%
  

• Italian/German 10Y Yld Spread 186.0 basis basis points +4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 133.0 -5.0%
  

• Emerging Market CDS Index 235.30 -2.2%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.69 +.58%

• 2-Year Swap Spread 34.0 basis points +.75 basis point
  

• TED Spread 39.75 basis points -8.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -19.75 +2.0 basis points
  
• MBS  5/10 Treasury Spread  155.0 -2.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 670.0 +4.0 basis points
  
• Avg. Auto ABS OAS 91.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.9 +.18%
• 3-Month T-Bill Yield 4.74% +1.0 basis point
  

• China Iron Ore Spot 124.75 USD/Metric Tonne -.46%
• Dutch TTF Nat Gas(European benchmark) 43.6 euros/megawatt-hour +1.9%

• Citi US Economic Surprise Index 59.2 -1.6 points

• Citi Eurozone Economic Surprise Index 54.2 -5.8 points
  

• Citi Emerging Markets Economic Surprise Index 21.8 -.7 point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 226.11 -.18:  Growth Rate +1.7% -.1 percentage point, P/E 17.9 +.3
  
• S&P 500 Current Year Estimated Profit Margin 12.31% -2.0 basis points
  
• Bloomberg US Financial Conditions Index -.32 +8.0 basis points
• Bloomberg Euro-Zone Financial Conditions Index -4.05 +10.0 basis points
  
• US Yield Curve -55.25 basis points (2s/10s) -4.5 basis points
• US Atlanta Fed 1Q GDPNow Forecast +3.19% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.73% unch.: CPI YoY +5.22% unch.
  
• 10-Year TIPS Spread 2.34 +1.0 basis point
  
• Highest target rate probability for June 14th FOMC meeting: 49.0%(-9.5 percentage points) chance of 4.75%-5.0%. Highest target rate probability for July 26th meeting: 48.6%(+2.3 percentage points) chance of 4.75%-5.0%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +188 open in Japan 
• China A50 Futures: Indicating +70 open in China

• DAX Futures: Indicating +139 open in Germany

Portfolio:

• Higher:  On gains in my tech/medical/industrial/utility sector longs
  

• Disclosed Trades:  Covered some of my (IWM)/(QQQ) hedges
  

• Market Exposure: Moved to 75% Net Long
  

Bear Radar

Style Underperformer:

• Small-Cap Value -.6%
  

Sector Underperformers:

• 1) Regional Banks -1.9% 2) Oil Service -1.1% 3) Biotech -.8%

Stocks Falling on Unusual Volume: 

• PRCT, ROKU, NEP, RH, FRC, LOVE, NEOG, SCHW, AMLX, ACLX, AKRO, VRNT, SJT, AGL, TRMD, RNA, SMTC and MCB
  

Stocks With Unusual Put Option Activity:

• 1) JETS 2) RL 3) VOYA 4) HAS 5) RH
  

Stocks With Most Negative News Mentions:

• 1) SMTC 2) ANGO 3) SCHW 4) BBBY 5) SNDA
  

Charts:

• ETFs Falling on Unusual Volume
• Stocks Falling on Unusual Volume

Bull Radar

Style Outperformer:

• Large-Cap Growth +.2%
  

Sector Outperformers:

• Alt Energy +1.6% 2) Airlines +1.7% 3) Semis +1.2%

Stocks Rising on Unusual Volume:

• CXM, FLNC, EBS, VKTX, OSH, RMBS, KSS and IOT
  

Stocks With Unusual Call Option Activity:

• 1) SMTC 2) BTG 3) XRX 4) AGI 5) PWR

Stocks With Most Positive News Mentions:

• 1) EVGO 2) RMTI 3) CXM 4) KSS 5) SWAG
  

Charts:

• ETFs Rising on Unusual Volume
• Stocks Rising on Unusual Volume

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open: 

• None of note
  

After the Close: 

• None of note
  

Economic Releases

8:30 am EST

• Personal Income for Feb. is estimated to rise +.2% versus a +.6% gain in Jan.
• Personal Spending for Feb. is estimated to rise +.3% versus a +1.8% gain in Jan.
• The PCE Core MoM for Feb. is estimated to rise +.4% versus a +.6% gain in Jan.
  

9:45 am EST

• The MNI Chicago PMI for March is estimated to fall to 43.0 versus 43.6 in Feb.

10:00 am EST

• Univ. of Mich. Consumer Sentiment revisions. 
  

Upcoming Splits

• None of note
  

Other Potential Market Movers

• The Fed's Cook speaking, Fed's Williams speaking, Fed's Waller speaking and the China Non-Manufacturing PMI report could also impact global trading tomorrow.

US Equity Market Hours

• 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

• Volume Running +3.4% Above 100-Day Average 
• Nasdaq/NYSE Volume Ratio 9.1 +.7
  
• 2 Sectors Declining, 9 Sectors Rising
• 84.7% of Issues Advancing, 12.7% Declining
• 31 New 52-Week Highs, 4 New Lows
• 43.9%(+3.3%) of Issues Above 200-day Moving Average
• Average 14-Day RSI 52.0 +3.0
  
• Bloomberg Global Risk-On/Risk-Off Index 54.3 +2.4%
  
• Russell 1000: Growth/Value 15,979.2 +.2%
  
• Vix 19.3 +.7%
• Total Put/Call .89 -9.2%
• TRIN/Arms 1.11 +82.0%
  

Thursday Watch

Night Trading 

• Asian equity indices are -.25% to +.75% on average.

• Asia Ex-Japan Investment Grade CDS Index 134.75 -7.25 basis points. 

• China Sovereign CDS 77.0 -6.0 basis points. 
• China Iron Ore Spot 122.8 USD/Metric Tonne -.08%.

• Bloomberg Emerging Markets Currency Index 47.8 -.06%.
• Bloomberg Global Risk-On/Risk Off Index  53.8 +1.5%. 
• Bloomberg US Financial Conditions Index -.45 -6.0 basis points.
  
• Volatility Index(VIX) futures 21.1 +.8%.
• Euro Stoxx 50 futures +.19%.

• S&P 500 futures -.05%.

• NASDAQ 100 futures -.17%.  

Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by technology and commodity shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher.  The Portfolio is 50% net long heading into the day.