Otherwise sleepy utilities outrun S&P 500 large-caps by wide margin this year Valuations stretched, but XLU’s dividend yields compare favorably to 30-year yields With signs of crowded trade, worth waiting on XLU, as path of least resistance lower near-term Utilities … Continued
One of the perplexing things in the current economic cycle has been the suppressed velocity of money. Six years into recovery, velocity has yet to pick up steam. As the chart below shows, excess reserves have gone toe-to-toe with the … Continued
3Q14 GDP numbers revive – once again – hopes of surge in business capX Collapse in November y/y growth in orders for non-defense capital goods ex-aircraft With energy accounting for nearly 1/3rd of S&P 500 capX, capX bulls will have … Continued
Dollar continues to act well technically, amid signs of overcrowded trade U.S. exports’ share of GDP near all-time highs, means higher risk/reward to economy Strong greenback has not resulted in higher current account deficit last three years, a trend to … Continued
Yesterday came news that U.S.-based funds attracted $36.5bn in stock inflows in the week ended December 24 (courtesy of Thomson Reuters Lipper Service). Some thoughts on this: 1. The inflows are simply massive. There is no other way to describe it. … Continued
October 15th bottom in stocks forces shorts to cover in many sectors IWM expends lots of short-covering fuel to approach crucial resistance Nasdaq, NYSE short interest at multi-year highs, can bulls force squeeze? Since stocks bottomed on October 15th, naysayers … Continued
Despite escape-velocity meme, yield curve continues to tighten Message of belly/long end of curve to short-end: be careful what you ask for Financials diverge from 10-2 spread, perhaps setting up as shorting opportunity next month One of the contrarian themes … Continued
On a day when we are enjoying the blockbuster 3Q GDP numbers comes another data point that points to continued sluggishness in U.S. housing. Yesterday, existing home sales disappointed. Sales were lowest since May this year. I even heard one … Continued
10-year notes yielding lower vs when Nov’s blockbuster jobs report came out Large speculators’ net shorts in 10-year-note futures at four-plus-year high Bond vigilantes not buying hopes and prayers of escape-velocity backers Treasury bonds continue to catch a bid. A … Continued
Markit forecast of sub-200k private payroll growth this month a surprise U.S. unemployment claims, near historical lows, need catalyst to begin to move up Oil-heavy states are yet to see jobs impact of drop in crude, but only a matter … Continued