Stocks Reversing Slightly Higher into Final Hour on US Economic Soft-Landing Hopes, Dollar Weakness, Short-Covering, Tech/Defense Sector Strength

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) 18.9 -7.2%
• DJIA Intraday % Swing 1.48%
  
• Bloomberg Global Risk On/Risk Off Index 62.6 +2.0%

• Euro/Yen Carry Return Index 148.4 +.6%

• Emerging Markets Currency Volatility(VXY) 10.6 -.5%

• CBOE S&P 500 Implied Correlation Index 32.7 -3.0% 

• ISE Sentiment Index 96.0 -18.0 points
  

• Total Put/Call 1.03 +12.0%

• NYSE Arms .90 +9.8%

Credit Investor Angst:

• North American Investment Grade CDS Index 72.1 +.8%
  

• US Energy High-Yield OAS 356.7 -1.7%
• Bloomberg TRACE # Distressed Bonds Traded 325.0 +6.0
  

• European Financial Sector CDS Index 85.6 -1.1% 
• Credit Suisse Subordinated 5Y Credit Default Swap 381.2 -1.4%
  

• Italian/German 10Y Yld Spread 179.0 basis points -1.0 basis point
  

• Asia Ex-Japan Investment Grade CDS Index 109.5 -.41%
  

• Emerging Market CDS Index 228.20 -1.6%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 27.6 -.23%

• 2-Year Swap Spread 33.75 basis points +4.75 basis points
  

• TED Spread 12.0 basis points -1.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -8.5 +.25 basis point
  
• MBS  5/10 Treasury Spread  147.0 +4.0 basis points
  
• Bloomberg US Agg CMBS Avg OAS 102.0 +1.0 basis point
  
• Avg. Auto ABS OAS .67 +1.0 basis point
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 47.9 +.08%
• 3-Month T-Bill Yield 4.73% -3.0 basis points
  

• China Iron Ore Spot 123.10 USD/Metric Tonne +.5%
• Dutch TTF Nat Gas(European benchmark) 52.4 euros/megawatt-hour +1.3%

• Citi US Economic Surprise Index 23.6 +.1 point

• Citi Eurozone Economic Surprise Index 86.1 -1.2 points
  

• Citi Emerging Markets Economic Surprise Index 6.1 -.9 point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 223.95 +.06:  Growth Rate +.1% -.2 percentage point, P/E 18.3 -.1
• S&P 500 Current Year Estimated Profit Margin 12.43% +52.0 basis points
  
• Bloomberg US Financial Conditions Index .43 +5.0 basis points
  
• Yield Curve -86.25 basis points (2s/10s) -3.75 basis points
• US Atlanta Fed 1Q GDPNow Forecast +2.16% unch.
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +4.30% unch.: CPI YoY +6.24% -24.0 basis points
  
• 10-Year TIPS Spread 2.31 -1.0 basis point
  
• Highest target rate probability for May 3rd FOMC meeting: 75.3%(+2.7 percentage points) chance of 5.0%-5.25%. Highest target rate probability for June 14th meeting: 51.7%(+9.6 percentage points) chance of 5.25%-5.5%.
  

US Covid-19:

• 84 new infections/100K people(last 7 days total). 4.8%(-0.0 percentage point) of 1/14/22 peak(1,740) -0/100K people from prior report.
  
• New Covid-19 patient hospital admissions per 100K population -83.4%(+1.6 percentage points) from peak 7-day avg. of 1/9/22 - 1/15/22
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +153 open in Japan 
• China A50 Futures: Indicating +19 open in China

• DAX Futures: Indicating +120 open in Germany

Portfolio:

• Higher:  On gains in my commodity/industrial/tech sector longs and emerging market shorts
  

• Disclosed Trades:  Covered some of my (IWM)/(QQQ) hedges
  

• Market Exposure: Moved to 75% Net Long