Thursday, December 20, 2018

Stocks Lower into Final Hour on Fed Policy Mistake Worries, Govt Shutdown Concerns, Global Growth Fears, Energy/Restaurant Sector Weakness

 Broad Equity Market Tone:
  • Advance/Decline Line: Substantially Lower
  • Sector Performance: Almost Every Sector Declining
  • Volume: Heavy
  • Market Leading Stocks: Performing In Line
Equity Investor Angst:
  • Volatility(VIX) 29.6 +15.6%
  • Euro/Yen Carry Return Index 132.48 -.43%
  • Emerging Markets Currency Volatility(VXY) 9.54 -.93%
  • S&P 500 Implied Correlation 51.48 +1.3%
  • ISE Sentiment Index 56.0 -52.9%
  • Total Put/Call 1.92 +53.6%
  • NYSE Arms .82 -36.8%
Credit Investor Angst:
  • North American Investment Grade CDS Index 88.97 +4.46%
  • America Energy Sector High-Yield CDS Index 758.0 +4.28%
  • European Financial Sector CDS Index 108.22 +5.53%
  • Italian/German 10Y Yld Spread 221.0 -2.25 basis points
  • Asia Pacific Sovereign Debt CDS Index 11.62 unch.
  • Emerging Market CDS Index 204.24 +1.61%
  • iBoxx Offshore RMB China Corporate High Yield Index 151.09 +.10%
  • 2-Year Swap Spread 14.75 +1.25 basis points
  • TED Spread 40.5 -3.0 basis points
  • 3-Month EUR/USD Cross-Currency Basis Swap -3.5 +11.25 basis points
Economic Gauges:
  • Bloomberg Emerging Markets Currency Index 67.04 +.17%
  • 3-Month T-Bill Yield 2.38% unch.
  • Yield Curve 12.0 -1.25 basis points
  • China Iron Ore Spot 70.43 USD/Metric Tonne +.43%
  • Citi US Economic Surprise Index -10.6 -.9 point
  • Citi Eurozone Economic Surprise Index -74.60 +.4 point
  • Citi Emerging Markets Economic Surprise Index -3.7 -.3 point
  • 10-Year TIPS Spread 1.76 -4.0 basis points
  • 21.3% chance of Fed rate hike at March 20th meeting, 27.0% chance at May 1st meeting
Overseas Futures:
  • Nikkei 225 Futures: Indicating -167 open in Japan 
  • China A50 Futures: Indicating -47 open in China
  • DAX Futures: Indicating -79 open in Germany
Portfolio: 
  • Slightly Lower: On losses in my tech/biotech sector longs and emerging market shorts
  • Disclosed Trades: Covered some of my (IWM)/(QQQ) hedges and some of my emerging market shorts
  • Market Exposure: Moved to 75% Net Long

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