Passa ai contenuti principali

Stocks Bid Into Month-End Despite Americans' Unprecedented Scramble For Cash

 Amid an ever-escalating guess at the size of pension fund re-allocations funds (latest we saw was $150 billion) into month-end, both bonds and stocks were bid early on today, but as the day wore on, bonds weakened as stocks gained (driven by record IG issuance-driven rate-locks)...

Source: Bloomberg

But while some are rebalancing into stocks, the scramble for cash among average Americans has almost never been more panicky...

Tracking End-of-Month Re-Balancing

Source: Bloomberg

Just as notably, crude oil prices crashed to multi-decade lows today, completely decoupling from stocks (correlation crashed)...

Source: Bloomberg

The question is - how long will the bounce last? If it's month-end, then 2008 is still in play...

Source: Bloomberg

Maybe it's better not to play...

And most of all, some context shows that today's ramp merely unwinds the carnage from the last 30 minutes of Friday... (note this was a 1300 points rally off overnight lows)

S&P and Nasdaq managed to erase that late-day plunge...(Note the Dow ended perfectly unch from Friday highs)

Breadth was very weak with declining volume dominating advancing volume for most of the day...

Source: Bloomberg

The Dow pushed back above the Dec 2008 lows today...

Source: Bloomberg

Defensives outpeformed cyclicals today...

Source: Bloomberg

US IG credit has dramatically outperformed Europe since The Fed promise to start buying...

Source: Bloomberg

Treasuries were bid overnight but selling pressure accelerated as the US day session wore on (month-end rebalance and record IG issuance-driven rate-locks - U.S. companies borrowed a record $109 billion, which was met with $550 billion of demand, in what one dealer called a "food fight" for new bonds, according to Bloomberg)

Source: Bloomberg

Intraday, 10Y Yields fell back to a 59bps handle before the US session sell-off...

Source: Bloomberg

Mission Accomplished for The Fed as Agency MBS dislocations have corrected...

Source: Bloomberg

The Dollar Index managed gains today (the first in 5 days and best in 7 days)...

Source: Bloomberg


Cryptos rallied today but were unable to erase the losses from the weekend...

Source: Bloomberg

Commodities were all lower today led by crude's carnage...

Source: Bloomberg

WTI broke down to $19.27 at its lows (before bouncing back above $20.00 on the settle)...

And finally, as the oil market struggles with an unprecedented hit to demand caused by the coronavirus, its main measure of supply and demand is screaming that a historic glut is emerging.

Source: Bloomberg

As Bloomberg details, Brent crude futures for May are now trading at an incredible $13.30 a barrel discount to November prices, a deeper and more bearish super-contango than the market saw even in the depths of the 2008-09 global financial crisis. Consultants say that, as things currently stand, the world is just a few months from running out of places to stash crude.

And we note that the 'Virus Fear'-trade started to pick up again today...

Source: Bloomberg

Commenti

Posta un commento

Post popolari in questo blog

Charting the World Economy: The U.S. Jobs Market Is On Fire - Bloomberg

Charting the World Economy: The U.S. Jobs Market Is On Fire - Bloomberg https://www.bloomberg.com/news/articles/2019-12-06/charting-the-world-economy-the-u-s-jobs-market-is-on-fire Charting the World Economy: The U.S. Jobs Market Is On Fire Zoe Schneeweiss Explore what's moving the global economy in the new season of the Stephanomics podcast. Subscribe via  Apple Podcast , Spotify or  Pocket Cast . The last U.S. payrolls report of the decade was a doozy, beating expectations and doing its bit to keep the consumer in good health heading into 2020. That's good news given the various pressures still weighing on global growth. Here's some of the charts that appeared on Bloomberg this week, offering a pictorial insight into the latest developments in the global economy. U.S. Advertisement Scroll to continue with content ...
Posta un commento
Continua a leggere

Fwd: The Looming Bank Collapse The U.S. financial system could be on the cusp of calamity. This time, we might not be able to save it.

After months  of living with the coronavirus pandemic, American citizens are well aware of the toll it has taken on the economy: broken supply chains, record unemployment, failing small businesses. All of these factors are serious and could mire the United States in a deep, prolonged recession. But there's another threat to the economy, too. It lurks on the balance sheets of the big banks, and it could be cataclysmic. Imagine if, in addition to all the uncertainty surrounding the pandemic, you woke up one morning to find that the financial sector had collapsed. You may think that such a crisis is unlikely, with memories of the 2008 crash still so fresh. But banks learned few lessons from that calamity, and new laws intended to keep them from taking on too much risk have failed to do so. As a result, we could be on the precipice of another crash, one different from 2008 less in kind than in degree. This one could be worse. John Lawrence: Inside the 2008 financial crash The financial...
Posta un commento
Continua a leggere

Another Paradox: Consumer Spending Expectations Surge, Despite Dismal Income, Earnings

Call it the latest economic paradox. Despite widespread stories of doom and gloom about the state of US consumer finances once the fiscal stimulus bill expires on Dec 31, the latest NY Fed survey of consumer expectations unexpectedly shows that US consumers have little intention of slowing down their spending. In fact, and very paradoxically,  despite depressed and flat income and earnings growth expectations,  with median one-year ahead expected earnings growth at 2.0% for fifth consecutive month and expected income growth barely little changed at 2.14% ... ...  consumers' 1-year ahead  spending growth expectations  jumped to 3.73% over the next 12 months in November  - the highest level in more than four years, not only up from the 3.06% in the previous month but a whopping 33% more than the 2.8% reported last November,  making this the biggest Y/Y increase in expected spending in series history. This bizarre increase took place even as labor market signals were mixed: although t...
Posta un commento
Continua a leggere