Post U.S. tax-cuts, the sell-side pencils in massive earnings for S&P 500 companies for this year and next. Given already lofty valuations, investors are likely to treat this as an anomaly more than a trend. Earnings estimates for this year … Continued
After a big rally in recent months, 10-year Treasury yields are giving out signs of fatigue – at least near term. Interest rates have suddenly become the talk of the town. Ten-year yields rallied from 2.03 percent on September 7 … Continued
Following futures positions of non-commercials are as of February 13, 2018. 10-year note: Currently net short 296.9k, down 30.6k. If 10-year Treasury yields (2.88 percent) reach three percent – or even where they are currently – would/could that be used … Continued
How times have changed? It did not take long for markets’ attention to do a 360 from fears of deflation to that of inflation. January’s consumer price index was reported Wednesday. It was stronger than expected. In the 12 months … Continued
Small-business optimism remains near multi-decade highs. Small-cap stocks do not quite share this optimism. The NFIB optimism index rose two points month-over-month in January to 106.9, just a hair’s breadth away from November’s 107.5, which was a 34-year high. Optimism … Continued
U.S corporate bond issuance slowed down in January, but it is too early to read too much into this. In the first month of the year, corporations issued $109 billion in investment-grade (IG) and $23.2 billion in high-yield (HY) – … Continued
It is a top. But is this the top? All of a sudden, it is not a crazy question to ask. The ferocity by which U.S. equities have dropped in recent sessions, one has to wonder if this marks a … Continued
Following futures positions of non-commercials are as of February 6, 2018. 10-year note: Currently net short 327.5k, up 111.9k. The bond market is worried. Yes, beginning last October the Fed has been curtailing its bloated $4.5-trillion balance sheet. Yes, foreigners’ … Continued
Mediocre demand for Wednesday’s auction of $24 billion in 10-year Treasury notes probably reflects worries over rising deficit spending. In that auction, yields obviously were not attractive enough to entice aggressive buying. Ten-year yields ended the session up eight basis … Continued
Having stopped responding to improving U.S. fundamentals, the US dollar index currently sits at a confluence of technical support. The U.S. economy in recent quarters has put up strong numbers. Real GDP in 4Q17 grew at a seasonally adjusted annual … Continued