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”
Greetings, United States: The 2020 surge in reserves has been concentrated at large banks. Eurozone: China is increasingly important for German exporters. Asia-Pacific: Taiwan’s and South Korea’s stocks are soaring. Commodities: The wheat rally has stalled. Credit: High-yield munis rallied in response to Democrats taking control of the US Senate. …
Greetings, Equities: The news of Democrats taking control of the US Senate reignited the reflation trade. The market is betting on the federal government unleashing further fiscal stimulus, boosting consumption, economic growth, and inflation. Here is the relative performance of stocks that benefit from higher prices (Citi inflation long index) vs. those that do …
Greetings and Happy New Year, United States: The betting markets are now predicting that Democrats will take control of the Senate after the Georgia races. This was a surprise for the markets. The impact on equities is unclear as massive stimulus programs may offset higher corporate taxes. Stock futures are a bit softer …
Greetings and Happy New Year, United States: The updated December manufacturing PMI (from Markit) shows faster growth in the nation’s factory activity. However, the report points to rising supply bottlenecks as the pandemic worsened. Here is a comment from Markit. Eurozone: Germany’s VAT (sales tax) cut will be rolling off from …
Greetings and Happy New Year, United States: The dollar weakness should help improve US exports. This chart shows the annual changes in the Bloomberg US dollar index. Eurozone: German hospitals are under pressure. China: The stock market is pushing toward record highs. Cryptocurrency: Bitcoin blasted past $30k. So far, Bitcoin is …
Greetings, Administrative Update: Please note that The Daily Shot will not be published from Thursday, December 24 through Friday, January 1. However, in keeping with our annual tradition, here is our special edition of Food for Thought. As a reminder, scheduling updates are available online at https://thedailyshot.com/administrative-updates/ Business/Personal Finances: Public construction spending: …
Continue reading “The Daily Shot Brief – December 30th, 2020”
Greetings, Administrative Update: Please note that The Daily Shot will not be published from Thursday, December 24 through Friday, January 1. However, in keeping with our annual tradition, we will send out a special edition of Food for Thought next week. As a reminder, scheduling updates are available online at https://thedailyshot.com/administrative-updates/ United States: …
Continue reading “The Daily Shot Brief – December 23rd, 2020”
