No one seemed prepared for Brexit. Seriously. Polls were wrong. Bookmakers were wrong. Paddy Power, Ladbrokes, they all missed it. Reaction in the various asset markets was equally treacherous. Stocks dropped everywhere on Friday. The German Dax composite collapsed 6.8 … Continued
Last Friday, post-Brexit win, the 10-year Treasury yield declined 16 basis points to end the session at 1.58 percent. It fell as low as 1.53 percent at one point during the session. The drop ensured 10-year yields remained below support … Continued
The following are futures positions of non-commercials as of June 21, 2016. Change is week-over-week. (Please note holdings are prior to non-commercials’ potential Friday reaction post-Brexit win.) 10-year note: There goes any sliver of hope for a rate hike in … Continued
Dividend income is an important source of income. In 1Q16, it increased 1.3 percent year-over-year to a seasonally adjusted annual rate of $874.3 billion, down from $876.9 billion in the prior quarter. Dividends made up 5.6 percent of U.S. personal … Continued
Corporate bond issuance in May surged 74.5 percent month-over-month and 15.6 percent year-over-year to $205.8 billion. Of this, investment-grade was $177.1 billion and high-yield $28.7 billion. IG jumped 105.6 percent m/m and 21.8 percent y/y, while HY was down 9.8 … Continued
Chart 1 in yesterday’s post drew many e-mail responses, some of which were critical. Critical because the post used a trailing price to earnings (P/E) for the S&P 500 index, rather than forward. To refresh, the chart used a four-quarter … Continued
Many times in the past spot VIX spikes, but cannot hang on to the gains and reverses quickly. Chart 1 only goes back eight months, but this phenomenon goes back a lot longer. VIX just experienced one such spike reversal. … Continued
This week, May’s existing and new home sales data come out – on Wednesday and Thursday, respectively. In April, the former rose 1.7 percent month-over-month to a seasonally adjusted annual rate of 5.45 million units, and has essentially gone sideways … Continued
If the past couple of weeks were an indication, bulls and bears are locked in a vicious tug of war over the near- and medium-term direction of crude oil. From the February 11th low to the June 9th high, spot … Continued
The following are futures positions of non-commercials as of June 14, 2016. Change is week-over-week. 10-year note: In Godfather III, Michael Corleone famously says: “Just when I thought I was out, they pull me back in.” Given the circumstances, this … Continued