Fri May 5, 2023

Stocks Move Lower To Kick Off May

~ Peter Lynch Good evening: Despite the prevailingly negative sentiment about the market, we entered May with the S&P 500 almost exactly where it was one year ago: it closed...

Fri May 5, 2023

As regional banks pressures spread, S&P 500 faces headwinds. But look for possible near-term bottom of banks (per Newton). April Jobs and CPI are next 2 key data points.

At the start of the week, I was hopeful that the combination of Fed decision day (5/3) and soft readings on labor (JOLTS, employment report) would cause markets to constructively...

Mon May 1, 2023

Arguably, this coming week most critical to our positive equity 2023 thesis. April ISM might be inflection = tactically favor Industrials $XLI this week. Plus, May FOMC might be last hike of cycle = thesis changing.

This is the most hated 7-month, 20% rally ever. This coming week is arguably the most critical to our positive equity thesis in 2023. The S&P 500 is up 9%...

Fri April 28, 2023

April Closes Higher, S&P 500 Up 9% In 2023

Good evening: Trading is over for April, with the SPX up about 1.46% for the month and the Nasdaq up 0.04%, in line with historical norms. Although markets did not...

Wed April 26, 2023

Equity markets bank into "bunker mode" in front of May FOMC but ATH in unemployment claims for over $200k earners = far softer wage growth ahead. April 2023 rebalance "Granny shots" net -3 (+7, -10).

Reminder, tune in this coming Thursday to an important webinar ___________________________________GRANNY SHOTS APRIL QUARTERLY REBALANCE TODAySEE BELOW FOR ADDS AND DELETES ___________________________________ Equity markets came under selling pressure on Tuesday,...

Wed April 12, 2023

We view any equity weakness (possible) post-March CPI as chance to BTD given magnitude of "trapped bears" and softening inflation trends

On the eve of the March CPI report (released on 4/12 at 8:30am ET), few investors have conviction on what to expect from the actual report -- in other words,...

Mon April 3, 2023

Setup for stocks favorable for April... inflation cooling = aiding dovish Fed. Rule of 1st 5 days implies S&P 500 >4,275 by end of April.

At the start of 2023, Street consensus was bearish on equities, both sellside and investors. We have written about the unusual bearishness of Street in 2023, so we will not...

Wed March 29, 2023

Aftershocks part 3: Ripples still widening. Technology borrowing costs now 63bp LOWER than banks and VIX closed below 20 1st time since SVB.

It has been nearly 3 weeks since the sudden failure of SVB and the aftershocks continue. The biggest impact from the banking crisis is the market's expectations for Fed policy...

Mon March 27, 2023

Even as banking crisis still expanding, FAANG/Tech nearly recovered entire 2022 losses

The scope of the banking crisis continues to edge wider, with additional regional banks seeing pressure by investors (bonds well under par) and over the weekend, a Bloomberg article noted...

Fri March 24, 2023

Post-March FOMC, Powell cited "tight" (regarding policy/banks) 23 times vs 8 in Feb = Fed reaction function changing. 5 reasons Technology/FAANG and Bitcoin holding up, despite credit/rates turmoil.

Two weeks ago, the collapse of Silicon Valley Bank (SVB Financial) triggered the current financial crisis and these aftershocks continue. The severity of the shock is far more evident in...

Wed March 22, 2023

5 thoughts heading into March FOMC decision day. Is +25bp bullish or bearish? It's both, but stocks might rally anyways

On the eve of the very consequential March Fed FOMC decision (Wed 2pm ET press conf), many investors are confounded by the relative resilience of stocks (down <2% from pre-SVB...

Mon March 20, 2023

Aftershocks Part 2: UBS/CS merger staves off failure, but confidence shaken for bank stakeholders = markets now "reaction dependent" and Fed might do so. 4 signs to see first signs the crisis ebbing. Stay OW Tech + Bitcoin.

Over the weekend, $UBS announced plans to acquire Credit Suisse, in the latest action to contain the widening financial crisis. A total of 4 notable events took place since Friday,...