SVB Fin’l is in talks to sell itself after failing to raise the necessary capital to remain independent. In case you’ve ...
US market futures reversed losses this morning, and UST yields declined, after applications for US unemployment benefits rose to t...
It was clear that Powell wanted to deliver a hawkish message yesterday during his testimony. Now, investors are extrapolating a potential 6% top on rates with the potential for 50bps rate hikes, versus the prior expected consensus of 25bps at upcoming meetings. Whether or not the Fed delivers these ...
Read moreInvestors will be scrutinizing Powell’s testimony to Congress for hints on any updated economic outlook or rate path. Certainly, he’ll be discussing inflation, labor strength, growth, and everything else that is keeping investors on edge. If he coos like a dove at all, expect total reversal of s...
Read moreKey labor stats (mentioned in pic below) will shine a light on whether Jan’s strength was a blip or a trend. Also, put on your seatbelt for Powell’s semi-annual testimony to Congress....
Read morePowell will be delivering his semi-annual address to the Senate Banking Committee on Tuesday, and given his history of off-record talking moving markets, we would make sure to be in your seat. Yesterday we saw how the buy button got hit after Bostic simply said he would support a 25bps hike in Mar. ...
Read moreThe S&P kept above its 200 DMA to backstop recent weakness for a 2nd time this week. But intraday we’ve seen weakness since Feb, and if you get research from a variety of providers like we do, you’ll find that the “calls” out right now range from prioritizing US markets to shorting them. Ses...
Read moreISM factory activity for Feb was 47.7. Below 50 is in contraction. The median estimate was 48 pre-release. ISM new orders rose in Feb, by the most since 2020, yet bookings were still below 50. Prices paid for materials was up to 51.3, meaning that costs are up. ISM labor data showed a decline in hea...
Read moreCiti reported that investors increased their short bets in both US and EZ equity futures, given a more bearish sentiment. This comes on the heels of trader pricing in US rates to peak at 5.4%, versus closer to 5% last month. Treasury yields are up today, with the 10-yr UST heading toward 4%, a level...
Read moreThe S&P’s 50-day moving average (DMA) failed to hold last week, yet the 200 DMA is still holding. We’re also watching the 4Q22 floor of 3765. We’ll be watching for the incoming Jobs Report, CPI figures and Fed decision (including the updated dot plot) in mid-Mar. With Friday’s hot PCE data, ...
Read moreThat’s what the hotter-than-expected inflation reading pointed to this morning, driving the futures to retreat pre-market. UST yields rose and equities declined, with long-duration (e.g, tech, bonds) getting hit the hardest. The 2-yr UST yield, which is more responsive to Fed hikes, increased to t...
Read moreReal GDP was revised downward slightly (from 2.9% to 2.7%) due to higher inflation figures. Labor is still fairly strong, with initial unemployment claims down by 3k to 192k last week (below estimates). Continuing claims also declined by 37k, the greatest decline since Dec for the prior week’s da...
Read moreOne of the areas we cautioned clients about was the potential for reduced dividends and share repurchases, and Intel unfortunately is one data point making the case. Intel cut its quarterly dividend by more than 65%, just weeks after announcing $3bn in projected cost savings measures for 2023. Its s...
Read moreA backup in UST yields and weak guidance by Walmart and Home Depot followed an 8th consecutive weak EZ PMI reading. Stocks decidedly down to start the day. 4Q Earnings Recap Bernstein noted that during 4Q earnings season, beats on top + bottom lines resulted in 60bps of return on the print, versus ...
Read moreHawkish commentary by both US and EZ central bank leaders have increased rate-hike bets in the past few days, with messaging around investors’ lack of appreciation for the strength of inflation that will drive rates higher for longer. The USD is up (pretty much erasing losses for YTD), equities ar...
Read morePPI reported above expectations (+0.7% m/m and +6% y/y versus an expected 0.4% m/m), flagging the message we’ve been delivering for some time. Business’ high profit margins are out of sync with the disinflation storyline, and surprisingly they increased even more in Jan. So, something’s gotta ...
Read moreUS retail sales rose in Jan by the most in almost 2 yrs (+3%). All 13 retail categories improved last mo. Leaders were vehicles, furniture and restaurants. Seems like the strong labor market is keeping the retail party going here in 2023, and the Fed will definitely be watching. Thus, the US markets...
Read moreWhile the inflation print this morning was a bit more than “expected,” a lot of folks were already expecting that…so we’re not seeing markets tank at the open here. In fact, they’re up. OER (owners equivalent rent) is getting better, slowing m/m and looking like it has hit a top over the p...
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