The tailwinds that have been propelled the S&P 500 and Nasdaq up 7.5% and 9.8% respectively for the month seem to have disappeared. Rising concerns over the strength of the consumer and economy have become headwinds for equities. US Treasury rates fell after Jobless claims and Continuing claims were higher than estimates, with continuing claims rising every week since the beginning of September. Unlike previous sessions this month, the falling rates were not enough to push equities higher after…

The post CPI optimism continued into today’s equity trading but not quite as ebullient, as investors turned their attention to the most disregarded stocks of the last few months — banks, airlines, consumer discretionary etc. Shorted names were covered or outright bought as investors scrambled to add beta to their portfolios—as evidenced by the GS Most Short Rolling index up over 9% in the past two sessions. The move looks like early November’s jump of 11%, but that move was short-lived and t…

Just give me a reason, just a little bit’s enough

After a strong week of rallying, equities pulled back from a ~two-month high driven by peaking Fed rates bets. Albeit the S&P 500 fluctuated near its key 4,400 mark, equities seemed rather directionless throughout today’s trading session. Futures started out rocky as the U.S debt rating cut by Moody’s last week bled into this morning to only trade sideways in today’s session. As we have a plethora of economic data and FOMC speakers on deck, all hands and eyes are glued for tomorrow’s US CPI pri…

Equities were back in the saddle today with the S&P breaking out (and holding) above 4400. In dissecting indicies’ decided march up, a few curious trends emerge – the most glaring being an MVP award for the magnificent 7. As we move into year-end investors are playing catch up by betting on big tech while concerning relative lows this week for the Nasdaq, S&P, and Russell *equal weight* indices paint a more bearish picture. Today, the S&P finished up +1.56%, a stark divergence from its equal we…

What a week can do. Even after today’s drop, the S&P 500 is still 110 points higher than when Powell spoke post-FOMC. Markets have shifted their outlook to higher till next May (as of this morning), with rate cuts starting then. Fed heads this week have not changed that new investor expectation, but traders will always give added attention to Chairman Powell. Today he commented that the Fed is “not confident” policy is at a restrictive enough level, offsetting the dovish tilt investors had pric…

Equities finished mixed in a monotonous trading session marking the eighth consecutive up day in the S&P and ninth up day in the Nasdaq. In terms of catalyst, rather bare until next Tuesday, November 14th, when we get US CPI data. 10-year Treasury yield fell further, assisted in part by a decent auction which bolstered stocks higher in the latter half of the day. The tone of headlines around the US-China relationship continued to improve ahead of the Biden-Xi summit next week at APEC, while the…

Remember in the early days of the Zoom call boom, when invariably one of the ‘attendees’ faces would freeze, and usually in some unflattering manner to boot. I was reminded of that as I monitored the indices movements in the afternoon. Were they frozen? Not quite, but after an early dip in the red and an equally fast move into the green, equities were largely static for the balance of the afternoon. It’s been a wild few weeks (months? year?) so any calm may be welcome. Minnesota Fed President K…

It’s official- just another manic Monday… and the 6th consecutive day of gains for US equities, if only on a technicality. We can now declare that the S&P has been up six days in a row only seven total times over the course of the last 2 years. Despite an ultimate close in the green for the major US indices, today served as more of a respite from the ascension of late in mostly listless trading. Yields resumed their advance from the get and ate into equity gains for the afternoon but were ul…

The rally continues…US Stock futures rose while bond yields fell after signs of a labor-market slowdown bolstered speculation the Fed will hold policy rates steady through year-end. With the strong finish in equities to the week, in fact the best of 2023 thus far and the strongest weekly performance since November 2022. I can’t help but point out how squeezy it feels, specifically Goldman’s most shorted basket GSCBMSAL Index (+4.42%), while the most shorted baskets in Europe outperformed, the M…