Stocks Falling into Afternoon on US Policy-Induced Stagflation Fears, Earnings Outlook Worries, Technical Selling, Tech/Alt Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance:  Most Sectors Declining
  

• Volume:  Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 23.3 +.8%
• DJIA Intraday % Swing .65% -47.7%
  
• Bloomberg Global Risk On/Risk Off Index 4,044.0 -248.0 points

• Euro/Yen Carry Return Index 143.20 -.84%

• Emerging Markets Currency Volatility(VXY) 12.1 -1.1%

• CBOE S&P 500 Implied Correlation Index 43.2 -.8% 

• ISE Sentiment Index 87.0 -5.0 points
  

• Total Put/Call 1.05 +12.9%

• NYSE Arms 1.99 +83.9%

Credit Investor Angst:

• North American Investment Grade CDS Index 83.85 +.01%
  

• US Energy High-Yield OAS 501.24 +.74%
• Bloomberg TRACE # Distressed Bonds Traded 464.0 -20.0
  

• European Financial Sector CDS Index 115.83 -3.3%

• Italian/German 10Y Yld Spread 229.0 basis points -3.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 158.97 -3.5%
  

• Emerging Market CDS Index 354.39 +.27%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 26.4 +.15%
  
• Ukraine Sovereign Debt Credit Default Swap 11,472.0 -8.6%
  

• 2-Year Swap Spread 22.25 basis points -1.5 basis points
  

• TED Spread 37.25 basis points +7.0 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -22.25 basis points -1.75 basis points
  
• MBS  5/10 Treasury Spread  132.0 -4.0 basis points
  
• iShares CMBS ETF 48.62 +.81%
• Avg. Auto ABS OAS .95 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 48.93 -.02%
• 3-Month T-Bill Yield 2.39% -3.0 basis points
  

• Yield Curve -20.75 basis points (2s/10s) -1.25 basis points
  

• China Iron Ore Spot 106.0 USD/Metric Tonne +4.2%

• Citi US Economic Surprise Index -64.40 -4.4 points

• Citi Eurozone Economic Surprise Index -92.20 -30.6 points
  

• Citi Emerging Markets Economic Surprise Index 21.9 +.1 point

• 10-Year TIPS Spread 2.35 +5.0 basis points
  
• Highest target rate probability for September 21st FOMC meeting: 58.2%(+17.8 percentage points) chance of 2.75%-3.0%. Highest target rate probability for November 2nd meeting: 46.4%(+17.9 percentage points) chance of 3.0%-3.25%.
  

US Covid-19:

• 266 new infections/100K people(last 7 days total). 15.3%(-.4 percentage point) of 1/14/22 peak(1,740) -7/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -71.3%(unch.) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -214 open in Japan 
• China A50 Futures: Indicating -74 open in China

• DAX Futures: Indicating -65 open in Germany

Portfolio:

• Slightly Higher:  On gains in my index hedges and emerging market shorts
  

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

• Market Exposure:  Moved to 25% Net Long