The Daily Shot® Brief

Greetings,

The United States: This is the second longest streak of continuous payroll gains since 1939.

Betting markets have sharply reduced the likelihood of a recession this year following the election.

Equities: The options market is anticipating record-high earnings reactions, with implied single-stock moves outpacing broader market volatility.

The sharp drop in funding spreads reflects reduced demand for equity derivatives. Institutional investors, including pension funds and hedge funds, appear to have shifted to net selling amid evolving Fed rate expectations.

The Eurozone:  French bond spreads remain elevated amid political budget uncertainty.

India: The rupee has been under pressure.

Japan: Japan’s stock/bond correlation remains elevated, which typically occurs during periods of high inflation.

Food for Thought: Grocery retailers’ market share:

Edited by William Villacis

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Greetings,

The United States: The unemployment rate declined.

The United Kingdom: Here is a look at the UK’s energy sources.

China: Trade was a substantial portion of the GDP growth last year.

Emerging Markets: Here is Mexico’s factory output.

Equities: Small caps have struggled in recent weeks as bond yields climb.

Credit: Bank loan funds continue to see inflows.

Food for Thought: Math scores:

Edited by Josh Oldmixon

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Greetings,

The United States: US labor force growth has stalled.

The United Kingdom: The pound remains under pressure.

Emerging Markets: Argentina’s factory output continues to rebound.

Cryptocurrency: It has been a tough week for cryptos so far, with DeFi tokens underperforming.

Equities: Bank stocks continue to underperform the S&P 500 since the SVB collapse.

Rates: USD-denominated money market fund assets are nearing $7 trillion.

Food for Thought: OpenAI’s valuation:

Edited by Josh Oldmixon

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Greetings,

The United States:  FOMC participants sharply shifted their views on inflation risks (to the upside).

Consumer credit unexpectedly fell in November, marked by the steepest drop in credit card debt since the 2020 COVID shock.

The United Kingdom: Gilt yields are hitting multi-year highs.

Japan: Wage growth has accelerated.

Equities: The UBS Early Warning Signal points to downside risk for stocks.

Rates: Treasury yields continue to diverge for the copper-to-gold ratio.

Commodities: US egg prices are at record highs.

Food for Thought: Cancer rates have been rising among younger Americans, driven by gastrointestinal cancers.

Edited by William Villacis

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Greetings,

The United States: Layoffs remain subdued.

The United Kingdom: Falling vacancy rates point to weaker wage pressures.

Asia-Pacific: Australia’s job vacancies have paused their downward trend, which began in mid-2022.

Commodities: Shanghai steel futures remain under pressure.

Equities: The stock-bond correlation is positive again.

Credit: Last year’s bankruptcy filings reached their highest level since 2010.

Food for Thought: Support for the TikTok ban in the US by age group:

Edited by Josh Oldmixon

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Greetings,

Equities: The S&P 500 average stock (Equal Weight Index) valuation discount to the S&P 500 continues to widen.

Canada: Canada’s yield curve has been steepening.

China: China’s total private debt service ratio hit a record high.

Emerging Markets: Here is an overview of projected policy rate changes for LatAm central banks.

Rates: TLT is down 14% from the September 2024 peak.

Cryptocurrency: Crypto funds saw modest outflows last week after attracting a record $44 billion in fresh capital last year.

Food for Thought: Declining fish consumption in Japan:

Edited by William Villacis

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Greetings,

The United States: According to the ISM PMI report, the US manufacturing downturn eased in December as demand strengthened

Equities: Crowded longs are outperforming again.

The Eurozone: Hedge funds are increasingly bearish on the euro.

China: The renminbi weakened beyond 7.3 to the dollar as Beijing increasingly signals its intent to curb the currency’s decline.

Emerging Markets: Argentina’s USD-denominated bonds continue to see a rebound as Milei secures bank financing.

Credit: US corporate BBB/single-A spread hit a multi-year low, indicating higher risk appetite.

 Commodities: Cattle futures continue to rally.

Food for Thought: Holiday debt trends:

Edited by William Villacis

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Greetings,

The United States: Construction spending was unchanged in November, weighing on Q4 GDP growth.

The United Kingdom: The pound started the year on a weak note.

Energy: Brent crude is nearing $76/bbl.

Commodities: Chicago cattle futures are surging.

Equities: The S&P 500 has been down for five sessions in a row.

Credit: This chart compares the ratings distribution of the US high-yield index before the Global Financial Crisis and the present.

Food for Thought: The number of babies born every hour by country:

Edited by Josh Oldmixon

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Greetings,

The United States: Shares of homebuilders have sold off sharply.

Rates: Here is the 10-year Treasury total return around the start of Fed cutting cycles.

Europe: Are markets too dovish on the ECB policy rate trajectory?

China: The stock market started the year with a sharp decline.

Emerging Markets: Increased trade barriers could weigh on EM currency performance.

Equities: The composition of the S&P 500 has increasingly tilted toward innovation sectors, with growth coming at the expense of manufacturing. This shift reflects the broader transformation of the US economy toward technology and services.

Global Developments: This scatterplot shows economic vs. inflation surprises across developed markets.

Food for Thought: Optimism for 2025 by country:

Edited by William Villacis

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Greetings,

The United States: The Dallas Fed’s regional manufacturing index shifted into growth territory for the first time since early 2022.

Europe: Spain’s consumer inflation unexpectedly accelerated in December.

Commodities: A sustained rise in commodity prices may require a turnaround in China’s credit impulse.

Equities: The Nasdaq 100 is testing support at the 50-day moving average.

Credit: This chart provides an overview of total US outstanding debt securities, categorized by type.

Rates: The Global Financial Crisis led to significant deleveraging in the private sector, particularly within households and financial institutions, while the government increased borrowing substantially to support the economy through fiscal stimulus.

Food for Thought: Most played openings at Chess Olympiad 2024:

Edited by Josh Oldmixon

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