Stocks Finish Sharply Lower on US Economic Data, Earnings Outlook Jitters, Yen Strength, Tech/Alt Energy Sector Weakness

Broad Equity Market Tone:

• Advance/Decline Line: Substantially Lower
  

• Sector Performance: Almost Every Sector Declining
  

• Volume: Around Average
  

• Market Leading Stocks: Performing In Line
  

Equity Investor Angst:

• Volatility(VIX) 22.8 +14.3%
• DJIA Intraday % Swing 1.61 +16.8%
  
• Bloomberg Global Risk On/Risk Off Index 47.7 -4.7%

• Euro/Yen Carry Return Index 174.2 -1.0%

• Emerging Markets Currency Volatility(VXY) 8.9 unch.

• CBOE S&P 500 Implied Correlation Index 24.6 +18.9% 

• ISE Sentiment Index 126.0 -9.0 points
  

• Total Put/Call 1.15 +36.9%

• NYSE Arms 1.21 -6.9%
  
• NYSE Non-Block Money Flow -$266.7M 
  

Credit Investor Angst:

• North American Investment Grade CDS Index 53.3 +3.3%
  

• US Energy High-Yield OAS 329.04 +4.2%
• Bloomberg TRACE # Distressed Bonds Traded 262 +13
  

• European Financial Sector CDS Index 64.2 +2.4%
  
• Deutsche Bank Subordinated 5Y Credit Default Swap 166.8 +.34%
  

• Italian/German 10Y Yld Spread 145.0 basis points +2.0 basis points
  

• Asia Ex-Japan Investment Grade CDS Index 95.7 +.34%
  

• Emerging Market CDS Index 168.2 +1.2%
  
• Israel Sovereign CDS 134.5 -.43%
  

• China Corp. High-Yield Bond USD ETF(KHYB) 24.76 -.28%

• 2-Year SOFR Swap Spread -21.25 basis points -1.0 basis point
  

• Treasury Repo 3M T-Bill Spread -27.25 basis points -1.5 basis points
  

• 3-Month EUR/USD Cross-Currency Basis Swap -2.5 -.5 basis point
  
• MBS  5/10 Treasury Spread 129.0 -4.0 basis points
  
• Bloomberg CMBS Investment Grade Bbb Average OAS 705.0 +6.0 basis points
  
• Avg. Auto ABS OAS 67.0 unch.
  

Economic Gauges:

• Bloomberg Emerging Markets Currency Index 38.8 -.33%
• 3-Month T-Bill Yield 5.05% -1.0 basis point
  

• China Iron Ore Spot 90.25 USD/Metric Tonne -1.6%
• Dutch TTF Nat Gas(European benchmark) 36.48 euros/megawatt-hour +.78%

• Citi US Economic Surprise Index -30.1 -.6 point

• Citi Eurozone Economic Surprise Index -43.6 +7.2 points

• Citi Emerging Markets Economic Surprise Index -8.8 -.8
• S&P 500 Current Quarter EPS Growth Rate YoY(498 of 500 reporting) +11.6% +.2 percentage point
  
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 266.18 +.11:  Growth Rate +13.9% unch., P/E 20.3 -.3
  
• S&P 500 Current Year Estimated Profit Margin 12.65% -4.0 basis points
  
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(9 of 10 reporting) +36.3% unch.
  
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 347.88 +.97: Growth Rate +22.2% -.5 percentage point, P/E 30.1 -1.1
  
• Bloomberg US Financial Conditions Index .52 +6.0 basis points
  
• Bloomberg Euro-Zone Financial Conditions Index .61 -9.0 basis points
  
• US Yield Curve 5.5 basis point (2s/10s) +7.75 basis points
  
• US Atlanta Fed 3Q GDPNow Forecast +2.09% unch.
  
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 73.1% +.8 percentage point
  

• Cleveland Fed Inflation Nowcast Core PCE YoY +2.74% unch.: CPI YoY +2.56% unch.
  
• 10-Year TIPS Spread 2.03 -1.0 basis point
  
• Highest target rate probability for Nov. 7th FOMC meeting: 52.4%(+3.5 percentage points) chance of 4.5%-4.75%. Highest target rate probability for Dec. 18th meeting: 40.6%(+6.9 percentage points) chance of 4.0%-4.25%.
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -1,081 open in Japan 
• China A50 Futures: Indicating -75 open in China

• DAX Futures: Indicating +2 open in Germany

Portfolio:

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

• Disclosed Trades: Added to my (IWM)/(QQQ) hedges, then covered some
  

• Market Exposure: 25% Net Long