Stocks Falling into Final Hour on Surging Long-Term Rates, Mideast War-Induced Inflation Fears, Fed Rate-Hike Worries, Financial/Alt Energy Sector Weakness

Economic/Market Gauges:

• North American Investment Grade CDS Index 59.3 +2.1% 
• BofA Private Credit Proxy Index 69.5 -.5% 
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .38 -5.0 basis points
• BofA Global Financial Stress Indicator -.05 -1.0 basis point
• European Financial Sector CDS Index 67.2 +2.5% 
• Emerging Market CDS Index 155.6 +3.2% 
• Israel Sovereign CDS 60.6 +1.8% 
• Bloomberg Global Trade Policy Uncertainty Index 1.3 unch.
• US Morning Consult Daily Consume Sentiment Index 84.9 -1.3

• Citi US Economic Surprise Index 46.3 -.2

• Citi Eurozone Economic Surprise Index 79.6 -3.3

• Citi Emerging Markets Economic Surprise Index 18.4 +.5
• S&P 500 Current Quarter EPS Growth Rate YoY(9 of 500 reporting) +15.9% -.3 percentage point
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 403.97 +.82:  Growth Rate +23.1% +.2 percentage point, P/E 19.0 unch.
• S&P 500 Current Year Estimated Profit Margin 16.28% -1.0 basis point
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 1,052.10 +3.47: Growth Rate +56.7% +.5 percentage point, P/E 18.1 -.2
• Bloomberg US Financial Conditions Index 1.22 -5.0 basis points
• US Yield Curve 30.75 basis points (2s/10s) unch.
• Bloomberg Industrial Metal Index 178.7 -1.4%
• Dutch TTF Nat Gas(European benchmark) 71.1 euros/megawatt-hour -1.3%
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 8.0% -.5 percentage point
• US Atlanta Fed GDPNow Q3 Forecast +5.0% -10.0 basis points
• US 10-Year T-Note Yield 5.23% +7.0 basis points
• 1-Year TIPS Spread 2.54 +4.0 basis points

• Highest target rate probability for Dec. 9th FOMC meeting: 58.3% (+7.3 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Jan. 27th meeting: 46.4%(+.1 percentage point) chance of 4.25%-4.5%. (current target rate is 3.75-4.0%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating +2 open in Japan 
• China A50 Futures: Indicating -68 open in China
• KOSPI 200 Futures: Indicating -3 open in South Korea 

• DAX Futures: Indicating +323 open in Germany

Portfolio:

• Higher: On gains in my biotech/consumer discretionary sector longs, index hedges and emerging market shorts
• Disclosed Trades: None
• Market Exposure: 50% net long