Friday, December 15, 2023

The Morning Call--Traders go all in on the great 'Fed pivot'

 

The Morning Call

 

 

12/15/23

 

The Market

         

    Technical

               

            Thursday in the charts.

            https://www.zerohedge.com/markets/crude-oil-crap-stocks-credit-soar-amid-hedge-fund-carnage-ahead-largest-opex-history

 

            For the bulls.

            https://investorplace.com/hypergrowthinvesting/2023/12/the-fed-just-confirmed-2024-could-be-colossal-for-stocks/

 

            Traders go all in on great ‘Fed pivot’.

            https://www.bloomberg.com/news/articles/2023-12-14/wall-street-traders-go-all-in-on-great-monetary-pivot-of-2024?srnd=premium&sref=loFkkPMQ

 

            Odds favor a risk-on positioning.

            https://www.capitalspectator.com/risk-on-signal-for-global-markets-strengthens-after-fed-news/

 

                From the Goldman desk.

            https://www.zerohedge.com/markets/goldman-trader-are-6-trillion-money-market-funds-about-flood-stock-market

 

                TLT closes above its 200 DMA.

            https://www.zerohedge.com/the-market-ear/king-tlt-0

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

The December NY Fed manufacturing index came in at -14.5 versus projections of +2.0.

                          https://www.zerohedge.com/economics/empire-fed-manufacturing-unexpectedly-crashes-contraction

                                    

                        International

 

The December Japanese flash manufacturing PMI was 47.7 versus estimates of 49.5; the flash services PMI was 52.0, in line; the flash composite PMI was 50.4 versus 50.8.

 

The December German flash manufacturing PMI was 43.1 versus predictions of 43.2; the flash services PMI was 48.4 versus 49.8; the flash composite PMI was 46.7 versus 48.2.

                                   

The December EU flash manufacturing PMI was 44.2 versus consensus of 44.6; the flash services PMI was 48.1 versus 49.0; the flash composite PMI was 47.0 versus 48.0; the November trade balance was E11.1 billion versus E14.0 billion.

https://www.zerohedge.com/economics/eurozone-pmis-paint-disheartening-picture-economy

 

The December UK flash manufacturing PMI was 46.4 versus expectations of 47.5; the flash services PMI was 52.7 versus 51.0; the flash composite PMI was 51.7 versus 50.8; the December consumer confidence index was -22, in line.

 

December Chinese YoY industrial production was up 6.6% versus forecasts of 5.6%; December YoY retail sales were up 10.1% versus +12.5%; December YoY fixed asset investments were up 2.9% versus 3.0%; the November unemployment rate was 5.0%, in line.

                       

                        Other

              

                          The perils of forecasting.

                          https://www.tker.co/p/tker-2023-chart-of-the-year

 

               The Fed

 

  Talk about a contrary opinionist.  I don’t think that I have ever seen one as strong         as this.  Even though I have my doubts about a soft landing, I don’t think it wise to vehemently disagree with the bond market.

               https://www.washingtonexaminer.com/opinion/bond-markets-get-ahead-of-jerome-powell-again              

 

                      A cynic’s take on the ‘Fed pivot’.

                 https://www.zerohedge.com/markets/now-it-all-makes-sense

 

                      What rising (or falling) interest rates mean.

                 https://www.econlib.org/a-very-good-question/

 

   Fiscal Policy

  

  Here is the fly in the ‘Fed pivot’ euphoria ointment.  Granted lower interest   rates will help.  But this is a problem that haunts developed countries as well as emerging markets---the problem being too much debt that continues to grow.         https://www.cnbc.com/2023/12/13/developing-nations-spent-record-high-on-debt-in-2022-world-bank.html

                                  

    Recession

 

     Update on big four economic indicators.

        https://www.advisorperspectives.com/dshort/updates/2023/12/14/the-big-four-recession-indicators-real-retail-sales-up-0-2-in-november

 

 

                    Geopolitics

 

                 The West’s false narrative about Russia’s invasion of Ukraine.

                 https://www.nakedcapitalism.com/2023/12/russias-goal-conquering-ukraine-say-western-media-not-so-say-experts.html

 

                      Now read this and tell me the risks of a European war aren’t going up.

                 https://www.zerohedge.com/geopolitical/us-hails-historic-eu-membership-talks-ukraine-after-hungarys-orban-caves

 

                      Like I said.

                 https://www.zerohedge.com/geopolitical/russia-warns-if-nato-bases-used-ukrainian-jets-they-could-be-targeted

 

    News on Stocks in Our Portfolios

 

 

What I am reading today

 

           

 

 

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