Bulls buck the bears
Despite the post-pandemic hangover intensifying for some parts of the economy, stocks are off session lows as the bull continues bucking the bears with nascent signs of an economic landing of some type other than hard supported by steady-state activity data, lower inflation expectations, and hopes for a dovish Fed turn keep investors hopes alive….
Oil Update: 2 Drivers and 1 Subplot
Putting aside last night’s oil spill, two key drivers should keep markets supported, Russian production declining and Chinese mobility indicators rising. On the broader macro landscape, global data, for the most part, augers for some landing other than hard that should keep the dollar on the defensive and favourable for oil prices. The Fed-generated deflation…
Nuts & Bolts in focus
US stocks are little changed Tuesday, holding on to recent gains as investors digest a weak Richmond Fed Index (-11 vs +1 a month ago) and a mixed set of earnings releases suggesting the stock market is unsure where it sits this week regarding the good news-bad news dichotomy for the US economy. In recent…
Market Wrap: “Legoland Effect” on markets
MARKETS The US inflation improvement is working magic and reducing fears of most other structural impediments, including micro impulses from earnings as calmer seas ahead have investors sailing to the soft landing camp. Since we are still in a very uneven trading environment, a good portion of the street is still worried about when the…
Pre Open: Will the Fed cut in 2023?
Although there was little fresh macro news to drive sentiment, US stocks are starting the week on a high note, building on last Friday’s late rally as perhaps investors are deeply reflecting on easing concerns about inflation, rates, and the US economy’s path from here on out. Markets are assuming a pro-growth stance as investors…
Asia Open: Stocks supported – Oil down but not out
US equities were stronger Friday, S&P 500 up 1.9%, recovering from declines the previous three days. Short covering was the day’s flavour as expectations for less aggressive Fed policy soared after Fed Waller, a notable hawk, joined the downshift camp and sent short sellers scurrying for the exits. And importantly, US inflation continues to slink lower,…
Pre Monday open – ceilings
MARKETS After a solid start to the year, markets took a step back last week, and bond yields sagged further on renewed doubts over the growth outlook. At the same time, the U.S. ran into the debt ceiling, setting up possibly months of headlines and negotiation while extraordinary funding measures get used. Suppose you thought…
Macro thoughts: The stampede into bonds
The 2022 macro narrative was dominated by the highly positive correlation between bond and stock prices (i.e. rising yields and falling stocks). In this period, exogenous central bank action drove real rates higher, pushing discount rates up and sharply impacting equity valuations. The explicit intention of the Fed to tighten financial conditions meant that both…
Week Ahead : A Highly Overvalued US Dollar
WEEK AHEAD This week’s economic calendar is relatively light, particularly given that Fed officials ahead of next week’s FOMC meeting are in their traditional communications blackout period. That being said, there are a few critical data points this week that could, on the margin, influence the tone of next week’s meeting-namely, Thursday’s Q4 real GDP…
End of Week Report : 2023 favorite’s trades are trending to form
US stocks are trading higher Friday but still on track for a ~1.5% loss for the week (for the S7P 500 as of 2:00 PM EST Friday) as investors digested a mix of growth data and an uneven cadence of earnings that may have compelled some investors to move to the sidelines even as the…
