Stocks Lower into Final Hour on Escalating Mideast War Tensions, Mideast War-Induced Inflation Fears, Rising Long-Term Rates, Consumer Discretionary/Transport Sector Weakness

Economic/Market Gauges:

• North American Investment Grade CDS Index 50.5 +.2%
• BofA Private Credit Proxy Index 72.1 -.4% 
• Bloomberg US Securitized MBS/ABS/CMBS Avg. OAS .31 +1.0 basis point
• BofA Global Financial Stress Indicator -.13 +2.0 basis points
• European Financial Sector CDS Index 54.7 +1.7%
• Emerging Market CDS Index 137.7 +.4%
• Israel Sovereign CDS 53.1 +1.7%
• Bloomberg Global Trade Policy Uncertainty Index 1.0 +.4
• US Morning Consult Daily Consume Sentiment Index 89.5 +2.8

• Citi US Economic Surprise Index 25.6 -.4

• Citi Eurozone Economic Surprise Index 76.1 -3.1

• Citi Emerging Markets Economic Surprise Index 19.2 unch.
• S&P 500 Current Quarter EPS Growth Rate YoY(493 of 500 reporting) +53.2% unch.
• S&P 500 Blended Forward 12 Months Mean EPS Estimate 400.26 +.70:  Growth Rate +22.0% +.3 percentage point, P/E 19.1 -.2
• S&P 500 Current Year Estimated Profit Margin 16.31% +2.0 basis points
• NYSE FANG+ Current Quarter EPS Growth Rate YoY(10 of 10 reporting) +131.6% unch.
• NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 976.02 +1.42: Growth Rate +45.4% +.3 percentage point, P/E 19.0 -.1
• Bloomberg US Financial Conditions Index 1.23 -1.0 basis point
• US Yield Curve 40.75 basis points (2s/10s) +.5 basis point
• Bloomberg Industrial Metal Index 185.4 +.7%
• Dutch TTF Nat Gas(European benchmark) 79.1 euros/megawatt-hour +4.3%
• US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 11.2 -.1 percentage point
• US Atlanta Fed GDPNow Q3 Forecast +4.7% unch.
• US 10-Year T-Note Yield 4.84% +5.0 basis points
• 1-Year TIPS Spread 2.45 +2.0 basis points

• Highest target rate probability for Oct. 28th FOMC meeting: 54.3% (-.1 percentage point) chance of 3.75%-4.0%. Highest target rate probability for Dec. 9th meeting: 39.6%(-1.3 percentage points) chance of 3.75%-4.0%. (current target rate is 3.5-3.75%)
  

Overseas Futures:

• Nikkei 225 Futures: Indicating -970 open in Japan 
• China A50 Futures: Indicating -85 open in China
• KOSPI 200 Futures: Indicating -1 open in South Korea 

• DAX Futures: Indicating -10 open in Germany

Portfolio:

• Higher: On gains in my tech/energy sector longs, index hedges and emerging market shorts
• Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
• Market Exposure: Moved to 50% net long