Greetings, China: After the worst stock market slump since 2008 (amid a surge in COVID cases), Beijing has had enough. The authorities announced a number of measures to support the markets. Subsequently, Hong Kong and mainland shares jumped in response to the announcement. United States: Financial conditions have tightened sharply this year. According …
The Daily Shot Brief – March 15th, 2022
Greetings, United States: Seven Fed rate hikes for 2022 are now fully priced in. The chart below shows the futures market’s expectations for rate increases (in addition to the 25 bps hike this month). Eurozone: Economists have sharply reduced their GDP forecasts while bumping up inflation projections – a stagflationary trend. As a …
The Daily Shot Brief – March 14th, 2022
Greetings, United States: The 10-year yield is back above 2%. Meanwhile, the Treasury curve keeps flattening. Commodities: Here is last week’s performance across different commodity markets. Energy: US shale oil production and fracking fleet counts are recovering, albeit still below pre-pandemic levels. A wave of exploration and production activity could occur …
The Daily Shot Brief – March 11th, 2022
Greetings, United States: The CPI report was in line with expectations, as inflation hit the highest level in over 40 years. Energy: Energy markets are well off recent highs. Meanwhile, uranium prices are surging. Eurozone: The ECB will wind down QE sooner than expected, but will delay rate hikes due to the …
The Daily Shot Brief – March 10th, 2022
Greetings, United States: The CPI peak projections keep getting pushed out by economists The labor market remains tight, with the job openings report topping expectations. Equities: Small caps have been resilient in the recent selloff, with microcaps outperforming over the past week. Eurozone: European natural gas futures tumbled but remain well …
The Daily Shot Brief – March 9th, 2022
Greetings, United States: Below is a new index of consumer inflation expectations from ICE. Imports from China are still elevated. Energy: Making plastics is becoming unprofitable in Asia. Demand destruction? Will Russia turn off the spigot? Equities: Risk appetite has deteriorated, but is sentiment about to stabilize? Eurozone: The …
The Daily Shot Brief – March 8th, 2022
Greetings, United States: The yield curve keeps flattening as the market prices in slower growth ahead. This comes as President Biden announces a ban on US imports of Russian oil. Commodities: Nickel exploded to the upside as market participants got caught in a short squeeze (hedges have blown up amid massive margin calls). …
The Daily Shot Brief – March 7th, 2022
Greetings, Energy: Discussions of a Russian oil embargo and a setback in the Iran deal sent crude oil to multi-year highs. At this point, however, it’s not clear if Europe will agree to halt Russian oil purchases. European natural gas is up 45% today on Russian supply concerns. Commodities: COMEX copper futures hit …
The Daily Shot Brief – March 4th, 2022
Greetings, United States: Forget 50 bps. The market is no longer sure about a 25 bps rate hike this month. Concerns about the consequences of Russia’s invasion keep markets on edge. Russia’s attack on the nuclear power plant sent Treasury yields sharply lower. Eurozone: Market-based inflation expectations are soaring. Emerging Markets: Ukrainian …
The Daily Shot Brief – March 3rd, 2022
tGreetings, Commodities: Commodity inventories have been drawing down to near-record lows over the past year. Copper and aluminum inventories remain extremely low (2 charts). Energy: Brent crude is nearing $117/bbl, the highest level in a decade. Equities: Small caps are widening their outperformance. Rates: Treasury market liquidity has deteriorated. United …
