In March-April, Big Vacuum Left By Foreigners In US Sovereign Bond Market Filled By Fed

posted in: Credit, Economy | 0

Foreigners comprise an important source of buying in the US sovereign and corporate bond markets.  In March and April, they bought some corporate bonds but massively sold off Treasury notes and bonds.  The vacuum was filled by the Fed, whose … Continued

End-June Short Interest Dynamics Big Yawn, But Likely Factor In Current Period

posted in: Equities | 0

Much ado about nothing!  Really. A lot happened in the second half of June.  The 1.3-percent rally in the S&P 500 large cap index between June 15th and 30th belies the crazy roller-coaster ride those two weeks went through. First, … Continued

Last Week – Was It Risk-On Or Risk-Off?

posted in: Commodities, Credit, Equities, Technicals | 0

Post-Brexit two-session sell-off in stocks was a clear risk-off.  The S&P 500 large cap index dropped 5.3 percent in those two sessions.  The subsequent four-session, 5.1-percent surge through last Friday was risk-on.  Risk-off quickly followed by risk-on!  The average investor … Continued

Short Squeeze A Factor In Equity Rally, Longs Likely Using This As Opportunity To Exit

posted in: Equities | 0

Turns out short interest was indeed a tailwind for stocks in the two weeks ended October 15th. On SPY, the SPDR S&P 500 ETF, short interest declined 10.6 percent, to 332.1 million (Chart 1).  The ETF rallied 5.6 percent during … Continued

JNK Relief Rally Possible Short-Term, But More Pain Probably Lies Ahead Medium- To Long-Term

posted in: Commodities, Credit, Equities, Technicals | 0

One look at Chart 1, and it is hard to notice a significant change in momentum behind the U.S. high-yield debt market.  Through July, issuance totaled $188.4 billion.  Annualized, 2015 is on track to issuing north of $300 billion – … Continued

End-March short interest: Indices flat, lots of changes industry- and sector-wide

posted in: Equities | 0

Short interest as of the end of March was flat on an index level, but action was hot and heavy on an industry/sector level. On the NYSE, short interest was 15.68 billion, down from 15.69 billion two weeks ago.  On … Continued

HYG, JNK not likely to take kindly to hawkish Fed, let alone end of ZIRP

posted in: Credit, Economy, Equities | 0

Last six years, U.S. high-yield bond issuance of $1.6tn This week, several Fed officials signal imminent rate hike this year Junk bonds – popular risk-on vehicle – not likely to take kindly to end of ZIRP A week ago, HYG, … Continued

Has margin debt peaked? Can have repercussions for stocks, C&I loans

posted in: Credit, Equities | 0

Sideways movement in margin debt a sign investors’ risk appetite waning? 35-year correlation between stocks and margin debt of 0.95, 2014 was only 0.28 In 2000 and 2007, peak in margin debt preceded peak in C&I loans by one-plus year … Continued