Wednesday, December 1, 2021

The Morning Call---Toot a loo 'transitory'

 

The Morning Call

 

12/1/21

 

The Market

         

    Technical

 

            Tuesday in the charts.

            https://www.zerohedge.com/markets/powell-sparks-taper-tantrum-bonds-scream-policy-error

 

            More selling to come?

            https://www.zerohedge.com/the-market-ear/cdeaqkvcmc

 

Two items: (1) the Dow ended below its 100 DMA for the third day, reverting to resistance and (2) the S&P finished below the lower boundary of its short term uptrend; if it remains there through the close on Thursday, it will reset to a trading range. Even if this challenge is successful, remember from late Spring to mid Fall, the S&P broke its short term uptrend several times only to quickly reset to an uptrend. The point being that it is too soon to get squirrely.

 

            What the VIX is telling us….or not.

            https://www.zerohedge.com/the-market-ear/timetosell

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

Weekly mortgage applications fell 7.2% while purchase applications were up 5.1%.

 

Month to date retail chain store sales grew slightly faster than in the prior week.

 

The September Case Shiller home price index rose 0.8% versus consensus of +0.9%.

https://www.zerohedge.com/personal-finance/us-home-price-acceleration-slowed-very-modestly-september

 

The November Chicago PMI came in at 61.8 versus expectations of 67.0.

https://www.advisorperspectives.com/dshort/updates/2021/11/30/chicago-pmi-slips-in-november

 

November consumer confidence was reported at 109.5 versus predictions of 111.0

                          https://www.zerohedge.com/personal-finance/conference-board-confidence-slumps-november-hope-nears-5-year-low

 

The November ADP private payroll report showed job increases of 534,000 versus estimates of 525,000.

                                                  https://www.zerohedge.com/personal-finance/adp-signals-modest-slowdown-job-gains-november-despite-easiest-labor-market-ever

 

                        International

 

Q3 Japanese YoY capital spending was up 1.2% versus forecasts of +4.4%; the November final manufacturing PMI was 54.5 versus 54.2.

 

October German retail sales declined 0.3% versus projections of +1.0%; the November final manufacturing PMI was 57.4 versus 57.6.

 

The November EU final manufacturing PMI came in at 58.4 versus consensus of 58.6; the November UK final manufacturing PMI was 58.1 versus 58.2.

 

                        Other

 

            The Fed

 

How many times have I said in these pages that the Fed has never, ever, ever effectively managed a transition from easy to normal monetary policy? Yesterday, in his senate testimony, Powell said that the Fed is dropping ‘transitory’ from its inflation lexicon, sounding quite hawkish after a much more moderate narrative on Monday and apparently preparing the economy/Markets for the consequences a prolonged period of inflation and a tighter than heretofore expected monetary policy. Of course, given the Fed’s ‘on the one hand, on the other hand’ communication strategy, who knows what he will say today if the Market crashes. I tol’ you.

https://www.zerohedge.com/markets/stocks-bonds-tumble-powell-warns-accelerated-taper

 

              The end of free money.

              https://www.project-syndicate.org/commentary/great-inflation-bottlenecks-wage-price-spiral-by-hans-werner-sinn-2021-11

 

 

    News on Stocks in Our Portfolios

 

Mastercard (NYSE:MA) has announced a new share repurchase program to buyback up to $8B of its Class A common stock.

What I am reading today

 

           

 

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