Stocks Falling into Afternoon on Stagflationary US Economic Data, Earnings Outlook Fears, Profit-Taking, Energy/Biotech Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Lower
  

• Sector Performance: Most Sectors Declining
  

• Volume:  Around Average

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 19.9 +2.7%
• DJIA Intraday % Swing 1.0%
  
• Bloomberg Global Risk On/Risk Off Index 58.1 -1.1%

• Euro/Yen Carry Return Index 146.4 -.22%

• Emerging Markets Currency Volatility(VXY) 10.3 unch.

• CBOE S&P 500 Implied Correlation Index 35.3 +4.5% 

• ISE Sentiment Index 104.0 +11.0 point
  

• Total Put/Call .86 -3.4%

• NYSE Arms 1.32 +153.8%

Credit Investor Angst:

• North American Investment Grade CDS Index 71.9 +.17%
  

• US Energy High-Yield OAS 361.36 +1.0%
• Bloomberg TRACE # Distressed Bonds Traded 317.0 +21.0
  

• European Financial Sector CDS Index 87.4 -1.3% 
• Credit Suisse Subordinated 5Y Credit Default Swap 355.67 -.4%
  

• Italian/German 10Y Yld Spread 201.0 basis points +14.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 105.6 -.8%
  

• Emerging Market CDS Index 223.33 +.58%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 27.98 +.43%

• 2-Year Swap Spread 27.75 basis points -.5 basis point
  

• TED Spread 15.0 basis points -6.25 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -11.5 +2.25 basis points
  
• MBS  5/10 Treasury Spread  130.0 -1.0 basis point
  
• Bloomberg US Agg CMBS Avg OAS 107.0 unch.
  
• Avg. Auto ABS OAS .71 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 48.6 +.25%
• 3-Month T-Bill Yield 4.65% +5.0 basis points
  

• China Iron Ore Spot 125.3 USD/Metric Tonne -.6%
• Dutch TTF Nat Gas(European benchmark) 59.5 euros/megawatt-hour +3.8%

• Citi US Economic Surprise Index -10.8 -4.7 points

• Citi Eurozone Economic Surprise Index 101.3 +4.1 points
  

• Citi Emerging Markets Economic Surprise Index 2.7 -5.6 points
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 225.01 -1.81:  Growth Rate +.9% -9.0 percentage points, P/E 18.1 +.2
• S&P 500 Current Year Estimated Profit Margin 12.28% unch.
  
• Bloomberg US Financial Conditions Index .32 +2.0 basis points
  
• Yield Curve -73.5 basis points (2s/10s) -4.5 basis points
• US Atlanta Fed 1Q GDPNow Forecast +.67% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.30% unch.: CPI YoY +6.44% unch.
  
• 10-Year TIPS Spread 2.23 -3.0 basis points
  
• Highest target rate probability for March 22nd FOMC meeting: 84.2%(+1.8 percentage points) chance of 4.75%-5.0%. Highest target rate probability for May 3rd meeting: 54.3%(-.5 percentage point) chance of 4.75%-5.0%.
  

US Covid-19:

• 91 new infections/100K people(last 7 days total). 5.2%(-0.0 percentage points) of 1/14/22 peak(1,740) -0/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -81.7%(+.2 percentage points) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -160 open in Japan 
• China A50 Futures: Indicating +11 open in China

• DAX Futures: Indicating +9 open in Germany

Portfolio:

• Slightly Higher:  On gains in my tech/medical sector longs and index hedges
  

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

• Market Exposure: Moved to 25% Net Long