Sep 27, 2024
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“For those who believe, no proof is necessary. For those who disbelieve, no amount of proof is sufficient.” – Ignatius de Loyola
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
The quote above sums up the state of US politics heading into the election which is now over a month away. Those supporting either candidate have already dug in their heels, and if you think you can convince someone to change to your side, it will not happen. No matter what you or the candidate says or does between now and then in hopes to sway an opinion isn’t going to work. Despite that, hundreds of millions of dollars (and collective hours) will be spent between now and November 5th. It’s hard to believe anyone hasn’t already made up their mind.
There’s not much going on in US markets this morning. Equity futures have a modestly negative bias, crude oil is slightly higher, gold is slightly lower, and Treasury yields are modestly lower. It’s been a busy morning for economic data, though, with Personal Income, Personal Spending, Wholesale Inventories, and Core PCE all being released at 8:30. Michigan Sentiment will then hit the tape at 10 AM. Regarding the 8:30 data, Personal Income and Personal Spending both came in weaker than expected, but the PCE data was pretty much right in line with expectations. In reaction to the data, equity futures have ticked slightly higher.
Outside of the US, the monster rally in China continued overnight with the Shanghai Composite rallying close to 3% capping off a weekly gain of over 12% and gains every day this week. The positive tone flowed over into Asia as well as the Nikkei was up 2.3%.
Futures may be looking at modest losses to close out the week, but that comes after the S&P 500, on a market cap and equal-weighted basis (charts below) hit an all-time high yesterday. Regarding the equal weight index, the ETF that tracks it has been in a steady uptrend for over two months and heads into this weekend right at the upper end of that channel. The market cap-weighted index was slower making a new high and isn’t in the same uptrend as the equal-weight index, but it looks like it has made a convincing breakout above the July highs.
For the S&P 500’s breakout to keep up its momentum, it doesn’t necessarily need to see leadership from the megacaps, but they have to perform in line with the rest of the market, which they haven’t done in the last couple of months. As shown in the charts below, the only one of the trillion-dollar stocks that have been making new highs is Meta (META). As shown in the charts below, the other five have a ways to go before they even start approaching their prior highs.
Sep 26, 2024
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“We can no longer afford to be second best. I want people all over the world to look to the United States again” – John F Kennedy
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Equity futures surged overnight with the Nasdaq indicated to be up nearly 1.5% while the S&P 500 is poised to open higher by 0.75%. The only major catalyst in the US was a strong earnings report from Micron (MU) which surged over 16% after reporting an earnings triple play. The big news once again came out of China where the government said that it would undertake the necessary spending necessary to meet this year’s growth targets. That was also accompanied by reports that the government was prepared to pump $150 bln into the country’s largest banks. All of this news pushed stocks in the country firmly higher for the third straight day of 1%+ gains, and the impact has dispersed out to the rest of the global equity market.
In Europe, stocks have piggybacked on the overnight gains out of China, and the STOXX 600 has rallied over 1%.
Here in the US this morning, it’s a busy day for economic data with revised GDP, Personal Consumption, Core PCE, Durable Goods, and jobless claims all at 8:30. The most notable of these in our view was initial jobless claims, which once again confirmed that the surge earlier this summer may have been more seasonal than anything else. The only other report on the calendar is Pending Home Sales at 10 AM. If all this economic data isn’t enough, there are a ton of Fed speakers scheduled to speak, so many in fact that we couldn’t even fit them all on page one.
After another strong night for Chinese stocks, the Shanghai Composite has now rallied over 9% in the last three trading days with a bulk of the gains coming on Tuesday and today, even as Wednesday’s gain was a not-so-modest 1.2%. As shown in the chart below, the current run ranks as the strongest since July 2020, and before that August 2015. During the financial crisis, there were multiple occurrences, and then before that, there were a handful of occurrences in the years after China entered the WTO at the end of 2001.
The chart below shows each time the Shanghai Composite rallied over 9% in three days with no occurrences in the prior three months. Besides the current period, there were only six other occurrences, and the two that stand out most came right in the middle of major bear markets.
Sep 25, 2024
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“I putt like I did when I was a kid. When you’re a kid, you’re not scared of anything.” – Arnold Palmer
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
It’s a quiet morning in the markets so far as US equity futures are flat to modestly lower while US treasuries are modestly higher as they’ve steadily risen since the Fed cut rates last week. The only economic report remaining on the calendar this morning is New Home Sales, but weekly mortgage applications were released earlier today, and while overall applications were up 11% for the week, nearly all of it was related to refinancing activity which was up 20% compared to a gain of just 1% for purchase applications.
While 10-year yields seemingly rising every day since the Fed cut rates last week, gold is on pace for its sixth straight day of gains and its fifth straight record closing high. Gold surged earlier in the year before trading in a sideways range from April through July. Still, as summer wound down and the current easing cycle became more of a certainty, investors have been piling into the world’s oldest inflation hedge.
Looking at gold from a longer-term perspective, all-time highs in the price of gold have been relatively rare. Since 1976, it has closed at a record high on just 2% of all trading days, and they were generally concentrated into three periods. The first was in the late 1970s to early 1980. Then gold went another quarter century with no record highs. It wasn’t until the financial crisis and the Fed instituted its zero-interest rate policy that gold broke out above its 1980 peak, and those new highs continued until late 2011. During Covid, gold briefly hit another all-time high but traded in a sideways range again through the end of 2023. This year, though, the pace of new highs has been coming in heavy with 36 – or about an average of once a week. Put another way, with 36 new closing highs this year, 14% of all the record closing highs in the price of gold have occurred this year.
Of the 36 record closing highs in the price of gold this year, six have occurred this September (through 9/24), and that has helped to move September into second place for the month with the largest number of new closing all-time highs. That’s nearly the opposite of the S&P 500 where September has been the month with the fewest record closing highs. The only month with more is August, but with just four trading days left this month, August’s lead is safe for this year.
Sep 24, 2024
This content is for members only
Sep 24, 2024
See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium. CLICK HERE to learn more and start your trial.
“Show me a hero, and I’ll write you a tragedy.” – F. Scott Fitzgerald
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
To see yesterday’s CNBC interview, you can just click on the image below.
Futures in the US are looking at modest gains this morning ahead of Case Shiller housing numbers at 9 AM and Consumer Confidence at 10 but the big news overnight came out of China where the PBoC announced several stimulus measures designed to boost the economy and the stock market. You have to check out the commentary section of today’s report for a full in-depth recap (you won’t find a better one). While the positive response by the equity market to the stimulus measures is more than warranted given the stops pulled overnight and could have some follow-through in the short term, we’re not quite convinced that “all” the necessary stops were pulled to make this the seminal event for a turnaround in the long-languishing Chinese equity market and economy
As mentioned, China’s overnight stimulus measures powered the Shanghai Composite to a rally of 4.15% for its best one-day gain since July 6th, 2020. As impressive as the gain was, it barely got the index above its 200-day moving average and only back to levels it traded at in late August. Since its recent high in May, the Shanghai Composite is still down 10%. You have to start somewhere, but Chinese stocks still have a way to go.
Looking at a longer-term chart, Chinese stocks have had some big bouts of volatility where they more than doubled in just a couple of years and then gave back all of those gains just as fast. What also stands out is how volatility in the country has subsided. Over the last five years, there have been just two one-day gains of 4%+ while in the five before that there were 14. Combining those two most recent five-year periods, there have been 16 one-day gains of 4% in the last ten years which is only slightly more than half as many as there were in the ten years before that (31)!
