Stocks Reversing Modestly Lower into Final Hour on Emerging Markets/US High-Yield Debt Angst, Earnings Outlook Worries, Oil Decline, Energy/Retail Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Mixed
  

• Volume: Slightly Below Average

• Market Leading Stocks: Underperforming

Equity Investor Angst:

• Volatility(VIX) 15.84 +3.6%

• Euro/Yen Carry Return Index 137.86 -.11%

• Emerging Markets Currency Volatility(VXY) 10.68 -.65%

• S&P 500 Implied Correlation 55.57 +2.27%

• ISE Sentiment Index 67.0 -34.95%

• Total Put/Call .84 -16.83%

• NYSE Arms 1.46 +45.9% 

Credit Investor Angst:

• North American Investment Grade CDS Index 80.70 -.49%

• America Energy Sector High-Yield CDS Index 1,124.0 +1.01%

• European Financial Sector CDS Index 70.14 -2.22%

• Western Europe Sovereign Debt CDS Index 19.28 -5.37%

• Asia Pacific Sovereign Debt CDS Index 68.84 -1.42%

• Emerging Market CDS Index 325.88 +1.76%
  

• iBoxx Offshore RMB China Corporate High Yield Index 123.68 +.02%

• 2-Year Swap Spread 9.75 +.5 basis point

• TED Spread 22.75 -3.75 basis points

• 3-Month EUR/USD Cross-Currency Basis Swap -40.5 unch.

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 71.13 +.17%
• 3-Month T-Bill Yield .13% unch.

• Yield Curve 146.0 unch.

• China Import Iron Ore Spot $48.58/Metric Tonne +.7%

• Citi US Economic Surprise Index 1.0 +.1 point

• Citi Eurozone Economic Surprise Index 23.8 +.1 point

• Citi Emerging Markets Economic Surprise Index -3.0 +1.1 points

• 10-Year TIPS Spread 1.58 -2.0 basis points
• # of Months to 1st Fed Rate Hike(Morgan Stanley) 2.98 +.10

Overseas Futures:

• Nikkei 225 Futures: Indicating +22 open in Japan 
• China A50 Futures: Indicating -17 open in China

• DAX Futures: Indicating -23 open in Germany

Portfolio: 

• Slightly Lower: On losses in my medical/biotech/retail sector longs

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges

• Market Exposure: Moved to 25% Net Long