Consumer Confidence Bucks the Trend

In a sea of weaker than expected reports recently, today’s data on Consumer Confidence managed to buck the trend.  In June’s report, overall confidence increased from 117.6 up to 118.9 compared to expectations for a decline to 116.  While off its recent highs, overall confidence still remains right near its highest levels in more than 15 years and is well above the average of 93.8 going back to 2000.  Within the June report, however, there was a bit of disparity in that while the Present Situation Index increased to a new multi-decade high, the Expectations Index pulled back.  As a result, the spread between the two indices is at its widest level since February 2008.

One reason consumers likely have to be positive about their present situation is that jobs are easier to get than they have been at any other point since August 2001.  The fact that confidence about the future hasn’t been keeping up with current conditions, though, suggests that consumers aren’t so sure that these jobs are long lasting.

 

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ETF Trends: International – 6/27/17

Solar tops our list of best perfomers this week, up about 6% along with Biotech, who continues its run at the top. Steel is another notable outperformer, up about 5% after being down almost 5% last week. Underperformers continue to come from the oil sector, down about 2%. Telecoms and Banks are also notable underperformers.

Bespoke provides Bespoke Premium and Bespoke Institutional members with a daily ETF Trends report that highlights proprietary trend and timing scores for more than 200 widely followed ETFs across all asset classes.  If you’re an ETF investor, this daily report is perfect.  Sign up below to access today’s ETF Trends report.

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Bespoke Morning Lineup – Pre-Market News and Analysis

Highlights

Bespoke’s Morning Lineup is the top pre-market report on Wall Street.  We cover everything you need to know to get your trading day started, including international market moves and events, post-market and pre-market earnings news, upgrades and downgrades, dividends and splits, economic indicators and estimates, big stock movers, market internals and much more.  It’s all presented in the original and concise format that Bespoke is known for so you can digest lots of information quickly and efficiently.

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The Closer — Monday Misses — 6/26/17

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Looking for deeper insight on global markets and economics?  In tonight’s Closer sent to Bespoke Institutional clients, we review misses in economic data from the US to start the week.

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ETF Trends: US Sectors & Groups – 6/26/17

Biotech continued to outperform among the universe of ETFs we track daily, rising by over 7% in the past 5 sessions. Solar has also outperformed. Both are a result of Trump Administration policy, with the Biotechs benefiting from the release of the Senate’s Health Care plan last week and solar stocks getting a boost from plans to construct a border wall clad with panels. Taiwan has rallied in the wake of the CBC’s policy meeting last week, and Treasuries have also turned in good performance. In the losing column: oil/Energy stocks, banks, the UK, and Australia.

Bespoke provides Bespoke Premium and Bespoke Institutional members with a daily ETF Trends report that highlights proprietary trend and timing scores for more than 200 widely followed ETFs across all asset classes.  If you’re an ETF investor, this daily report is perfect.  Sign up below to access today’s ETF Trends report.

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A Crude First Half For Oil

If there was a mercy rule in the financial markets, we may have already called it a year for crude oil.  With a decline of 20% on the year and declines in each of the last five weeks as well as eight of the last ten, 2017 just hasn’t been crude oil’s year.  Compared to prior years, crude oil is on pace for its worst first half in 20 years (1997), and if we get a decline like last week again, crude oil could conceivably see its worst first half since 1991!

Looking at crude’s chart over the last year, it closed out last week right below the lower end of its down-trending range that has been in place since its early-year highs.  The fact that it couldn’t bounce at this level is concerning if you are a bull.  It still remains extended to the downside, though, so you can’t rule out a short-term bounce from these levels.

 

 

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Bespoke Brunch Reads: 6/25/17

Welcome to Bespoke Brunch Reads — a linkfest of the favorite things we read over the past week. The links are mostly market related, but there are some other interesting subjects covered as well. We hope you enjoy the food for thought as a supplement to the research we provide you during the week.

Systemic Musings

Chart of the Week: FDI in Financial Centers (IMFBlog)

Foreign direct investment has surged over the last decade or so, but a disproportionate share of that investment (which typically has huge benefits for recipients in the form of technology transfers and productivity gains) has been finding its way to financial centers. [Link]

Fed raising the stakes (barnejek’s blog)

An argument that the Fed has not been missing its inflation target, reflexivity of markets, and a the impact of a higher inflation target. [Link]

Globalisation, inflation & political choices by Duncan Weldon (Medium)

The key question: what drove low and stable inflation in the wake of the 1980s? The traditional explanation is better monetary policy, but globalization may be a better one. [Link]

This Week In History

Bear Stearns Staves Off Collapse of 2 Hedge Funds by Vikas Bajaj and Julie Creswell (NYT)

The Times’ recounting of the events that kicked off the subprime crisis: Bear Stearns’ bailout of two hedge funds deeply invested in mortgage-backed securities. [Link; soft paywall]

Investing

Stock Picking Is Dying Because There Are No More Stocks to Pick by Jason Zweig (WSJ)

An argument that fewer listed stocks makes picking the winning ones harder. It should be noted, though, that this appears to be a phenomenon only found among the smallest listed stocks. [Link]

Short-Seller Nailed Home Capital, Then Got Stung by Buffett by Noah Buhayar (Bloomberg)

Marc Cohodes (who we talked to on Bespokecast recently, link) is on the wrong side of Buffett, who has thrown a lifeline to the struggling Home Capital Group. [Link]

Politics

Political Divisions in 2016 and Beyond by Lee Durtman (Voter Study Group)

A comprehensive review of attitudes and ideology of 2016 voters, filled with interesting charts and data on the electorate’s views. [Link]

How Tinder Could Take Back the White House by Yara Rodrigues Fowler and Charlotte Goodman (NYT)

A fascinating – and concerning – development from the UK election: chatbots that borrow a Tinder user’s profile (with permission from the Tinder usr) as a way to communicate with potential voters. [Link]

Labor Markets

‘I Need More Mexicans’: A Kansas Farmer’s Message to Trump by Michelle Jamrisko (Bloomberg)

With half of the US agricultural labor force estimated to be undocumented immigrants, farmers are facing an impossible task finding the workers necessary to get crops out of the ground. [Link]

Uber Founder Travis Kalanick Resigns as C.E.O. by Mike Isaac (NYT)

Following a damning report on internal culture from former Attorney General Holder and chaos on the Uber board, the CEO has extended a leave of absence into full departure from management of the ride-sharing behemoth. [Link; soft paywall]

Environmental Activities

The Mammoth Pirates by Amos Chapple (Radio Free Europe/Radio Liberty)

A remarkable review of mining for mammoth, a practice which is seeking to meet insatiable demand for ivory without harvesting elephants. The mining does come at a cost though. [Link]

Why the World’s Rivers Are Losing Sediment and Why It Matters by Jim Robbins (Yale Environment 360)

Background on the build-up of sediment behind dams around the world, and its negative consequences for downstream agriculture, buffer areas like wetlands, and other parts of the global ecosystem. [Link]

Food

Obesity rates are skyrocketing, and dietitians say a key factor may be to blame by Erin Browin (Business Insider)

It’s a simple truism that if you surround yourself with junk food, it’ll be hard to resist it. That’s a huge problem for most of the world as cheap, easily accessible processed foods are constantly available and constantly tempting for dieters. [Link]

The Fake Rolex of Canned Foods by Mari Uyehara (Taste)

San Marzano tomatoes are everything in sauces, but most Americans don’t hold them in the same light; one of the reasons is that most San Marzanos are not what they claim to be. [Link]

Media Matters

Media Startups Try a Lower-Cost Model: Unpaid Student Writers by Austen Hufford (WSJ)

The hot new thing in content production: don’t pay people to produce it. [Link; paywall]

New York Times Sends Cease & Desist Letter Over CalPERS’ Massive Copyright Infringement; Potential Damages Eight Figures for Times and WSJ Each; Theft Extends to Virtually Every News Publication in US by Yves Smith (naked capitalism)

Remarkably, CalPERs (California’s pension system) ran a wholly illegal website for disseminating more than 50,000 articles from media organizations via an internal server to 2700 members. [Link]

Devilish Details

Banks to vote on alternative to Libor as new rate benchmark by Karen Brettell (Reuters)

Efforts are underway to pick a new alternative to the panel-submitted LIBOR rate. [Link]

The Snowballing Power of the VIX, Wall Street’s Fear Index by Asjylyn Loder and Gunjan Benerji (WSJ)

We had no idea that the VIX index emerged due to inquiries from Mark Cuban, but that’s a fact. An excellent summary of the VIX index’s history. [Link; paywall]

Retail

How to Survive the Retail Crisis: A Master Class from T.J. Maxx by Suzanne Kapner (WSJ)

Off price retailers have been able to generate growth and solid margins despite brutal performance for traditional boutiques, department stores, and other high-dollar retailing operations. [Link; soft paywall]

Amazon Turns to Subscription Boxes to Dominate Clothing Market by Kim Bhasin and Specer Soper (Bloomberg)

Prime Wardrobe allow shoppers to pick 3 or more pieces of clothing, try them for 7 days, and return them, a direct shot at a number of start-ups attempting to groom consumers into similar behavior. [Link; auto-playing video]

America’s Massive Retail Workforce Is Tired of Being Ignored by Sarah Jaffe (Racked)

An update on America’s largest employment sector, massive compared to other groups that get much more political attention, and arguably at much greater economic risk. [Link]

Get Some Rest

Hammocks Over Hikes This Summer by Emily Swanson and Beth J. Harpaz (AP)

Feeling tired, burned out, and in need of a lie-in? You’re not alone. Resting and relaxing is the most important vacation activity on Americans’ minds this summer. [Link]

Weird Market News

The Stock Market Speaks: How Dr. Alchian Learned to Build the Bomb by Joseph Michael Newhard (UGA)

An astounding paper that reveals how an investor identified the secret component of a new US nuclear weapon based on equity prices. [Link; 31 page PDF]

Have a great Sunday!

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The Closer 6/23/17 – End of Week Charts

Looking for deeper insight on global markets and economics?  In tonight’s Closer sent to Bespoke clients, we recap weekly price action in major asset classes, update economic surprise index data for major economies, chart the weekly Commitment of Traders report from the CFTC, and provide our normal nightly update on ETF performance, volume and price movers, and the Bespoke Market Timing Model. This week, we’ve added a section that helps break down momentum in developed market foreign exchange crosses.

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ETF Trends: Hedge – 6/23/17

Biotech continues to lead the charge, while oil and oil services gets pounded lower. Solar stocks have caught a bid this week, probably related to comments the President made about building a wall covered in solar panels. Metals and Mining recovered a bit on the week, while China, Tech stocks, and growth also performed well.

Bespoke provides Bespoke Premium and Bespoke Institutional members with a daily ETF Trends report that highlights proprietary trend and timing scores for more than 200 widely followed ETFs across all asset classes.  If you’re an ETF investor, this daily report is perfect.  Sign up below to access today’s ETF Trends report.

See Bespoke’s full daily ETF Trends report by starting a no-obligation free trial to our premium research.  Click here to sign up with just your name and email address.

Bespoke’s Sector Trading Range Charts — Health Care Explodes

Below is a look at our custom trading range charts for the ten main S&P 500 sectors (Real Estate not yet included).  In each chart, the white line represents the sector’s 50-day moving average, while the light blue shading represents its “normal” trading range.  This area represents between one standard deviation above and below the 50-day moving average.  More volatile sectors will have wider trading ranges, while less volatile sectors will have tighter trading ranges.  The red shading represents between one and two standard deviations above the 50-day, and moves into or above the red zone are considered “overbought.”  The green shading represents between one and two standard deviations below the 50-day, and moves into or below the green zone are considered “oversold.”

Where applicable, we’ve included trend lines to show uptrends, downtrends, sideways trends, breakouts, or breakdowns.

Going through the various sectors, you can see that Consumer Discretionary recently bumped up against the top of its uptrend channel and pulled back.  Consumer Staples recently broke above key resistance and has now pulled right back to that level which is acting as support.

The Energy sector has been trending down all year, and it just recently broke to a new 52-week low.

The Financial sector has been trending sideways for all of 2017.  We wouldn’t be aggressively long until it breaks out to a new 52-week high.  If it breaks below the bottom trend channel that we’ve drawn, look out below.

Health Care’s chart looks somewhat like a bullish cup and handle formation, and when it finally broke above resistance this week to make a new 52-week high, it broke out hard.  The chart for Industrials is about as slow and steady to the upside as it gets.  Both Materials and Technology look solid as well.  After a draw-down of a few percentage points from overbought levels, Tech pulled back to its 50-day and has thus far held support nicely.

Finally, Telecom remains in a downtrend channel and is approaching 52-week lows, while Utilities has been slowly trending higher all year.

The charts below are included in a section of our weekly Sector Snapshot report, which you can view when you start a 14-day free trial to our premium research platform.

 

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