The Daily Shot® Brief

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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Greetings,

The United States: Historically, inflation has risen roughly six months after the first Fed rate cut if the economy does not fall into a recession within a year of the cut. This implies that inflation could rise by the end of Q1 2025, potentially resulting in a pause in the Fed’s rate-cut cycle.

China: China’s bonds have outpaced global peers this year as yields continue to decline.

Equities: Equity funds registered outflows last week.

Cryptocurrency: Political uncertainty in South Korea boosted the local bitcoin premium to global markets (Kimchi premium).

Energy: US natural gas futures are soaring amid forecasts of colder-than-normal weather in the East and Midwest.

Emerging Markets: Turkey’s central bank has begun lowering interest rates.

Alternatives: Structured product issuance has been growing steadily.

Food for Thought: Data centers’ water consumption for cooling:

Edited by William Villacis

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Greetings,

Equities: Market breadth improved on Friday.

Asia-Pacific: Australian dollar futures positioning shifted sharply into bearish territory last week.

China: The SMI manufacturing survey shows factory activity in growth mode this month.

Commodities: Wholesale egg prices hit a record high.

Cryptocurrency: Bitcoin ETFs see some outflows.

The United States: US financial conditions tightened last week.

Global Developments: What do fund managers see as the best performing asset class next year?

Food for Thought: Global ocean-going cruise passenger growth:

Edited by William Villacis

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Greetings,

The United States: Consumer spending was very strong last quarter.

The United Kingdom: The pound was lower.

Europe: The market expects about 30 bps of rate reductions by March.

India: Growth in India’s crude oil consumption is expected to surpass that of China.

Commodities: Nickel prices dropped to the lowest level since 2020.

Equities: Alpine Macro expects small-cap earnings growth to outperform large-caps next year.

Food for Thought: Estimated holiday spending:

Edited by Josh Oldmixon

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Greetings,

The United States: The FOMC boosted its inflation forecasts for 2025, with inflation risks now skewed to the upside.

Rates: Investors’ expectations for declining bond yields have dissipated.

Equities: Here is the performance of various market components on FOMC day.

Asia-Pacific: The South Korean won weakened to its lowest level against the dollar since the Global Financial Crisis.

Commodities: Cocoa and orange juice prices continue to hit new highs.

The United Kingdom: Industrial orders tumbled this month.

Food for Thought: Electric and hybrid car adoption trends by country:

Edited by William Villacis

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Greetings,

The United States: Here is a look at monthly gains in core retail sales.

The United Kingdom: Here is Morgan Stanley’s forecast for the BoE rate over the next couple of years.

Commodities: Funds have been boosting their bets on corn futures.

Equities: It’s been a while since the Dow registered nine consecutive daily losses.

Rates: Repo volumes have been surging, fueled in part by extensive cash-futures basis arbitrage activity in Treasuries.

Food for Thought: Four main types of AI and their subcategories:

Edited by Josh Oldmixon

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Greetings,

The United States: US Import prices unexpectedly rose last month despite the stronger dollar.

The United Kingdom: The latest report reveals that UK GDP contracted for the second consecutive month.

China: Here is the China-US 10-year spread.

Equities: Market breadth continues to deteriorate.

Credit: Earnings growth of US leveraged loan issuers increased in Q3.

Food for Thought: Comparison of mobile data costs across 52 countries in 2024:

Edited by Josh Oldmixon

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