Stocks Reversing Lower into Afternoon on Crypto Crash, US Policy-Induced Stagflation Fears, US Voting Irregularity Concerns, Consumer Discretionary/Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Modestly Higher
  

• Sector Performance: Mixed
  

• Volume:  Around Average

• Market Leading Stocks: Underperforming
  

Equity Investor Angst:

• Volatility(VIX) 24.9 +2.1%
• DJIA Intraday % Swing 1.5%
  
• Bloomberg Global Risk On/Risk Off Index 49.8 -4.0%

• Euro/Yen Carry Return Index 151.3 -.23%

• Emerging Markets Currency Volatility(VXY) 12.2 -.33%

• CBOE S&P 500 Implied Correlation Index 50.3 +2.6% 

• ISE Sentiment Index 99.0 -16.0 points
  

• Total Put/Call 1.01 +14.8%

• NYSE Arms 1.20 +11.1%

Credit Investor Angst:

• North American Investment Grade CDS Index 88.3 -.41%
  

• US Energy High-Yield OAS 360.91 +1.9%
• Bloomberg TRACE # Distressed Bonds Traded 478.0 -20.0
  

• European Financial Sector CDS Index 114.20 -1.5% 
• Credit Suisse Subordinated 5Y Credit Default Swap 355.0 -.2%
  

• Italian/German 10Y Yld Spread 211.0 basis points -4.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 194.33 -1.9%
  

• Emerging Market CDS Index 270.52 -.01%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.0 +.50%

• 2-Year Swap Spread 36.0 basis points +1.0 basis point
  

• TED Spread 40.75 basis points -4.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -55.75 basis points -2.5 basis points
  
• MBS  5/10 Treasury Spread  162.0 -5.0 basis points
  
• Bloomberg US Agg CMBS Avg OAS 129.0 -1.0 basis point
  
• Avg. Auto ABS OAS 1.17 +2.0 basis points
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.01 +.18%
• 3-Month T-Bill Yield 4.14% +6.0 basis points
  

• Yield Curve -54.25 basis points (2s/10s) -3.5 basis points
  

• China Iron Ore Spot 88.5 USD/Metric Tonne +1.7%
• Dutch TTF Nat Gas(European benchmark) 118.2 euros/megawatt-hour +7.8%

• Citi US Economic Surprise Index 21.6 +.1 point

• Citi Eurozone Economic Surprise Index 10.5 -.4 point
  

• Citi Emerging Markets Economic Surprise Index 2.8 +1.6 points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 231.22 -.0:  Growth Rate +12.0% +.3 percentage point, P/E 16.5 +.0
  
• Bloomberg US Financial Conditions Index .95 +2.0 basis points
  
• US Atlanta Fed GDPNow Forecast +3.60% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +5.16% unch.: CPI YoY +8.09% unch.
  
• 10-Year TIPS Spread 2.49 -4.0 basis points
  
• Highest target rate probability for Feb. 1st FOMC meeting: 50.3%(-.2 percentage point) chance of 4.75%-5.0%. Highest target rate probability for March 22nd meeting: 45.5%(-1.5 percentage points) chance of 5.0%-5.25%.
  

US Covid-19:

• 84 new infections/100K people(last 7 days total). 4.8%(+.0 percentage point) of 1/14/22 peak(1,740) +0/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -83.7%(+1.9 percentage point) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -87 open in Japan 
• China A50 Futures: Indicating -13 open in China

• DAX Futures: Indicating -70 open in Germany

Portfolio:

• Slightly Higher:  On gains in my industrial sector longs and index hedges
  

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

• Market Exposure:  Moved to 50% Net Long