Greetings, United States: The Philly Fed’s manufacturing report showed solid factory activity in the region, exceeding market expectations. The report also showed manufacturers facing some price pressures, which they are passing on to their customers. United Kingdom: The CBI report showed UK manufacturers struggling with the confluence of the pandemic and Brexit. …
Continue reading “The Daily Shot Brief – January 22nd, 2021”
Greetings, United States: Fed communications remain highly focused on employment and household spending instead of inflation. By holding down rates, the US central bank has allowed the federal government to massively increase its debt without incurring higher interest expenses. Will the Fed sustain this trend as the US implements another fiscal stimulus package? …
Continue reading “The Daily Shot Brief – January 21st, 2021”
Greetings, United States: Consumer delinquency rates have been creeping higher in recent months. However, US household leverage hit a multi-decade low last year. Eurozone: France’s retail sector has taken a massive hit due to renewed lockdown measures. Asia-Pacific: Home sales point to further gains in Australia’s residential construction. China: State-owned …
Continue reading “The Daily Shot Brief – January 20th, 2021”
Greetings, United States: The fiscal package proposed by President-elect Biden is almost as big as the CARES Act. A new stimulus program of this size will turbo-charge economic growth and take the US to “full employment” by the fall of 2022, according to Moody’s Analytics. Eurozone: Italy’s Conte is trying to hold …
Continue reading “The Daily Shot Brief – January 19th, 2021”
Greetings, United States: The U. Michigan consumer sentiment index declined this month. The Republican-Democrat expectations gap continues to widen. Eurozone: Italy’s GDP contracted again in Q4 and will see another decline this quarter, according to Prometeia. Commodities: Commodities had an impressive run since last March. Equities: The Bespoke Investment’s “ludicrous” indicator …
Continue reading “The Daily Shot Brief – January 18th, 2021”
Greetings, United States: Many households are struggling to pay rent. Eurozone: This chart shows the ECB’s monthly asset purchases. Equities: The momentum factor has outperformed significantly over the past decade. Credit: Investment-grade corporate bond spreads are the tightest since 2018. The average energy-sector high-yield spread is below 500bps. Rates: US …
Continue reading “The Daily Shot Brief – January 15th, 2021”
Greetings, United States: Mortgage applications to purchase a home started the year on a strong note. Refinancing activity is also robust. Eurozone: Here we go again … The euro weakened in response to the news from Italy. Cryptocurrency: The mother of all bubbles? Equities: Tech represents a relatively small slice of …
Continue reading “The Daily Shot Brief – January 14th, 2021”
Greetings, Equities: The volume of call options is hitting unprecedented levels. These are effectively leveraged bets that allow retail investors to punch above their weight. Dealers are increasingly short gamma as they sell more options to clients. This tends to exacerbate volatility, especially during selloffs. Here is the GEX index, which is a rough estimate …
Continue reading “The Daily Shot Brief – January 13th, 2021”
Greetings, Equities: Tech stocks came under pressure on Monday in the aftermath of the Capitol attack last week. Rates: How much would the 10yr Treasury yield rise without the Fed’s QE program? Energy: The US rig count is recovering as oil prices strengthen. Asia is importing more US LNG as the …
Continue reading “The Daily Shot Brief – January 12th, 2021”
Greetings, United Kingdom: UK hospitals are stretched (3 charts). Cryptocurrency: Bitcoin is undergoing a correction as global markets shift into risk-off mode on Monday. Energy: The Brent backwardation increased sharply last week. Rates: Some traders are betting on a Fed rate hike in 2022. Global Developments: Speculative bets against the …
Continue reading “The Daily Shot Brief – January 11th, 2021”
