Stocks Falling Substantially into Afternoon on Escalating Russia/Ukraine Tensions, US Policy-Induced Stagflation Fears, Technical Selling, Tech/Pharma Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line:  Substantially Lower
  

• Sector Performance:  Almost Every Sector Declining
  

• Volume:  Heavy

• Market Leading Stocks: Outperforming
  

Equity Investor Angst:

• Volatility(VIX) 35.3 +21.7%
• Bloomberg Global Risk On/Risk Off Index 2,288.0 -480.0 points

• Euro/Yen Carry Return Index 132.77 unch.

• Emerging Markets Currency Volatility(VXY) 9.9 +3.3%

• CBOE S&P 500 Implied Correlation Index 47.3 +4.9% 

• ISE Sentiment Index 78.0  -17.0 points
  

• Total Put/Call 1.26 -4.6%

• NYSE Arms 1.2 -19.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 59.11 +1.47%
  

• US Energy High-Yield OAS 408.32 +4.2%

• European Financial Sector CDS Index 66.63 +4.6%

• Italian/German 10Y Yld Spread 139.0 +4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 89.40 +1.94%
  

• Emerging Market CDS Index 219.0 +2.5%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 32.10 +.31%

• 2-Year Swap Spread 18.25 unch.
  

• TED Spread 9.75 +.25 basis point
  

• 3-Month EUR/USD Cross-Currency Basis Swap -12.25 -.75 basis point
  
• MBS  5/10 Treasury Spread  86.75 unch.
  
• IHS Markit CMBX BBB- 6 75.0 +2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 54.05 -.61%
• 3-Month T-Bill Yield .16% -1.0 basis point
  

• Yield Curve 73.25 -2.5 basis points
  

• China Iron Ore Spot 132.30 USD/Metric Tonne -3.1%

• Citi US Economic Surprise Index -22.10 -18.7 points

• Citi Eurozone Economic Surprise Index 58.2 +17.8 points
  

• Citi Emerging Markets Economic Surprise Index 20.9 +2.1 points

• 10-Year TIPS Spread 2.38 +3.0 basis points
  
• 13.9%(+7.3 percentage points) chance of no change at March 16th FOMC meeting, 7.1%(+3.7 percentage points) chance of no change at May 4th meeting

US Covid-19:

• 1,485 new infections/100K people(last 7 days total). 86%(-6.0 percentage points) of 1/14 peak -88/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -8.0%(-5.2 percentage points) from peak 7-day avg. of 1/9/21 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -588 open in Japan 
• China A50 Futures: Indicating -144 open in China

• DAX Futures: Indicating +67 open in Germany

Portfolio:

• Slightly Higher: On gains in my consumer discretionary longs, emerging market shorts and index hedges
  

• Disclosed Trades:  Added to my emerging market shorts
  

• Market Exposure:  Moved to 25% Net Long