Stocks Substantially Higher into Final Hour on China Stimulus Hopes, Diminished US Virus Mandate/Lockdown Fears, Oil Gain, Biotech/Tech Sector Strength

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Higher
  

• Sector Performance: Almost Every Sector Rising
  

• Volume: Above Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 21.9 -19.6%
• Bloomberg Global Risk On/Risk Off Index 2,424.0 +481.0 points

• Euro/Yen Carry Return Index 131.80 -.2%

• Emerging Markets Currency Volatility(VXY) 11.1 -1.4%

• CBOE S&P 500 Implied Correlation Index 30.0 -15.6% 

• ISE Sentiment Index 147.0  +46.0 points
  

• Total Put/Call .92 -8.9%

• NYSE Arms .67 -1.4%

Credit Investor Angst:

• North American Investment Grade CDS Index 53.72 -4.7%
  

• US Energy High-Yield OAS 413.83 -5.5%

• European Financial Sector CDS Index 62.1 -5.9%

• Italian/German 10Y Yld Spread 130.0 +3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 89.70 -3.13%
  

• Emerging Market CDS Index 194.39 -4.9%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 33.06 +.72%

• 2-Year Swap Spread 21.5 -1.0 basis point
  

• TED Spread 14.0 -.5 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -21.5 +.5 basis point
  
• MBS  5/10 Treasury Spread  71.5 -1.75 basis points
  
• IHS Markit CMBX BBB- 6 72.75 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 53.65 +.62%
• 3-Month T-Bill Yield .05% +1.0 basis point
  

• Yield Curve 81.0 +4.5 basis points
  

• China Iron Ore Spot 115.0 USD/Metric Tonne +4.7%

• Citi US Economic Surprise Index 32.2 -.4 point

• Citi Eurozone Economic Surprise Index 3.6 +8.6 points
  

• Citi Emerging Markets Economic Surprise Index -11.4 +1.4 points

• 10-Year TIPS Spread 2.50 +3.0 basis points
• 92.6%(unch.) chance of no change at Jan. 26th meeting, 64.2%(-3.6 percentage points) chance of no change at March 16th meeting

US Covid-19:

• 253 new infections/100K people(last 7 days total) -5/100K people
• 47% of Jan. 7th, 2021 peak(highest daily avg. new infections) -1.0 percentage point
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +390 open in Japan 
• China A50 Futures: Indicating +59 open in China

• DAX Futures: Indicating -3 open in Germany

Portfolio:

• Higher: On gains in my transport/technology/medical/consumer discretionary/industrial sector longs
  

• Disclosed Trades:  Covered some of my (IWM)/(QQQ) hedges and took some profits in emerging market shorts
  

• Market Exposure:  Moved to 100% Net Long