Bespoke Matrix of Economic Indicators – 12/30/24
Our Matrix of Economic Indicators provides a concise summary analysis of the US economy’s momentum. We combine trends across the dozens and dozens of economic indicators in various categories like manufacturing, employment, housing, the consumer, and inflation to provide a directional overview of the economy.
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The Bespoke 50 Growth Stocks — 12/30/24
The “Bespoke 50” is a basket of noteworthy growth stocks in the Russell 3,000. To make the list, a stock must have strong earnings growth prospects along with an attractive price chart based on Bespoke’s analysis. There were 12 changes to the list this week.
The Bespoke 50 is available with a Bespoke Premium subscription or a Bespoke Institutional subscription. With Bespoke Premium, you’ll receive a number of daily market updates from us along with our weekly newsletter and a portion of our investor tools. With Bespoke Institutional, you’ll receive everything that’s included with Premium plus additional daily macro analysis and more stock-specific research.
To see all 50 stocks that currently make up the Bespoke 50, simply start a two-week trial to Bespoke Premium or Bespoke Institutional.
The Bespoke 50 performance chart shown does not represent actual investment results. The Bespoke 50 is updated monthly on Thursdays unless otherwise noted. Performance is based on equally weighting each of the 50 stocks (2% each) and is calculated using each stock’s opening price as of Friday morning after publication. Entry prices and exit prices used for stocks that are added or removed from the Bespoke 50 are based on Friday’s opening price. Any potential commissions, brokerage fees, or dividends are not included in the Bespoke 50 performance calculation, but the performance shown is net of a hypothetical annual advisory fee of 0.85%. Performance tracking for the Bespoke 50 and the Russell 3,000 total return index begins on March 5th, 2012 when the Bespoke 50 was first published. Past performance is not a guarantee of future results. The Bespoke 50 is meant to be an idea generator for investors and not a recommendation to buy or sell any specific securities. It is not personalized advice because it in no way takes into account an investor’s individual needs. As always, investors should conduct their own research when buying or selling individual securities. Click here to read our full disclosure on hypothetical performance tracking. Bespoke representatives or wealth management clients may have positions in securities discussed or mentioned in its published content.
Bespoke’s Morning Lineup – 12/30/24 – Rolling Over into Year End
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.
“When people are intimidated about having their own opinions, oppression is at hand.” – Jimmy Carter
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Former President Jimmy Carter didn’t leave office as the most popular President, but his years after serving in the Oval Office helped to improve his legacy as one of the most admired men in modern American history. Since 1946, Gallup has run an annual survey asking Americans “What man that you have heard or read about, living today in any part of the world, do you admire most? And who is your second choice?” In the survey’s history, Billy Graham tops the list with 61 of the top 10 finishes. Ronald Reagan ranks a distant second with 31 top-ten finishes, but right behind him, Jimmy Carter ranks third with 29, slightly ahead of Pope John Paul II (27) and Bill Clinton (26). Living to just over 100, the 39th President lived a full life.
US futures were trading just modestly lower until shortly before 8 AM Eastern but have weakened considerably since then on little news. Overnight in Asia, Japan and Korea both ended their trading years on a negative note with Japan’s Nikkei down 1% and the Kospi down a more modest 0.2%. In terms of economic data, Japan’s Manufacturing PMI came in below 50 for the sixth straight month. Trading in Europe had been much more subdued than in Asia, but these indices have also seen a pickup in the selling as US futures rolled over. Here in the US, both today and tomorrow will be full trading sessions, and markets will be closed on Wednesday for New Year’s Day.
Getting back to the US, this morning’s weakness will put the S&P 500’s 50-day moving average back into play after it held that level on Friday. As shown in the chart below, the technical picture isn’t looking particularly positive as we close out the year. The index has been gradually trending lower since its peak on 12/6. What a difference a few weeks make.
Brunch Reads – 12/29/24
Welcome to Bespoke Brunch Reads — a linkfest of some of our favorite articles 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.
Wounded Knee: On December 29th, 1890, one of the darkest chapters in US history unfolded at Wounded Knee Creek in South Dakota. What began as an effort by US troops to disarm a band of Lakota Sioux quickly escalated, leaving approximately 300 dead.
The Lakota, part of the Sioux Nation, had been participating in the Ghost Dance movement, a spiritual practice that sought to restore their lands and way of life. US authorities, who feared it might inspire rebellion, saw this movement as threatening. Tensions came to a head when US troops, led by the Seventh Cavalry, intercepted Chief Spotted Elk (Big Foot) and his band as they traveled to the Pine Ridge Reservation. The group was ordered to set up camp at Wounded Knee, where soldiers surrounded them. The next morning, as soldiers began disarming the Lakota, a gunshot, its source still debated, triggered chaos. Armed with Hotchkiss guns, the troops opened fire on the encampment.
Though some soldiers were awarded Medals of Honor for their actions, for the Lakota and other Native communities, it remains a searing reminder of the suffering endured during westward expansion.
Health & Wellness
The effects of ‘brain rot’: How junk content is damaging our minds (El País)
“Brain rot” being named Oxford’s Word of the Year says a lot about how people feel about endless scrolling and junk online content. Research shows that doomscrolling can mess with your brain, shrinking grey matter, shortening attention spans, and making it harder to focus. Experts say the key isn’t just cutting back on screen time but being intentional about what you’re watching and making room for real-world activities. [Link]
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The Bespoke Report — 2024 Recap
Our Bespoke Report – 2024 Recap is now available for Bespoke subscribers. This report is a must-read rundown of everything that went on across financial markets in 2024. Below is a look at some of the topics covered:
- The year in headlines
- Thematic performance
- Seasonality
- Sector performance
- Sector weightings
- Mega-caps
- Earnings triple plays
- International markets
- Earnings themes
- ETF performance matrix
You can read our 2024 Recap by signing up for our 2025 All Access Special that gets you the first two months of Bespoke Institutional access for just $20, or start a two-week trial to our Bespoke Premium plan. You can review our membership plans here to help make your decision.
Daily Sector Snapshot — 12/27/24
Bespoke’s Morning Lineup – 12/27/24 – Down the Hatch
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.
“A bottle of wine contains more philosophy than all the books in the world.” – Louis Pasteur
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Global equities are celebrating the last Friday of 2024 with broad-based gains after US stocks opened lower yesterday but finished around the unchanged level. In Asia, Japanese stocks rallied on reports that the BoJ was willing to be patient regarding its next rate hike. The only decliner in the region was South Korea which declined over 1% as political uncertainty continues. In Europe, stocks were closed for trading yesterday in observance of Boxing Day, and with just one day of trading before the weekend, activity is light. That hasn’t kept stocks in the region from rallying, though, and the STOXX 600 is trading nearly 0.5% higher.
The picture in the US isn’t as optimistic this morning as futures on the S&P 500, Nasdaq, and Dow are all down 0.30%. Treasury yields are higher again as the yield on the 10-year US Treasury tops 4.6%. The high for the year was just above 4.7% back in April, and if we reach that level in the days ahead, it could become problematic for stocks. Thankfully, oil prices have remained contained right near $70 per barrel while gold holds steady near $2,650 per ounce. Finally, Bitcoin has had a massive rally since the election, but for the last month now, it has moved sideways. At today’s level of around $96,700, Bitcoin is the same level now as it was on November 20th.
If a bottle of wine is full of philosophy, Americans have consumed increasingly less wisdom. Alcohol sales surged during Covid but pulled back as the economy reopened and people had to start working again. As if that wasn’t bad enough for sales, several other headwinds have lined up against the sector ranging from the growing popularity, legalization, and acceptance of cannabis, a renewed focus on health and wellness, declining popularity among younger generations, lack of affordability due to inflation, etc. Remember when it seemed like a different celebrity launched their own ‘artisanal’ tequila brand every week? You don’t hear those stories much anymore.
Given the issues facing the industry, it shouldn’t come as a surprise that companies selling booze have had a terrible year. Their weakness stands out even more relative to the overall market. As the S&P 500 closes out the year right near record highs with a YTD gain of over 25%, all six of the major public companies involved primarily in the sale of alcoholic beverages are down YTD, and three of them are right at or near 52-week lows.
Wine and other alcoholic beverages have been around for thousands of years. While recent quarters have seen sluggish sales, it’s unlikely that this will lead to the demise of the alcohol industry anytime soon. However, the factors contributing to these sales declines, don’t show any signs of ending soon. This raises the question: if Al Capone were alive today, would he even find the alcohol business as profitable as it was during Prohibition?
The Closer – Claims, CMBS and CRE, 7y Auction – 12/26/24
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Looking for deeper insight into markets? In tonight’s Closer sent to Bespoke Institutional clients, we lead off with a note on continuing claims relationship to the unemployment rate (page 1) followed by a dive into CMBS and office CRE (page 2). We then finish with a recap of Tuesday’s 5-year note auction and today’s 7-year note auction (page 3).
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Bespoke’s Weekly Sector Snapshot — 12/26/24
Are Continuing Claims a Concern?
With the holidays, today’s economic data slate was light with only jobless claims on the calendar. For initial claims, this week’s reading came in at 219K. That was down 1K from an unrevised reading of 220K the previous week and was a surprise decline versus the forecasted print of 223K. Seasonally adjusted weekly claims have been on the decline in the past few months, but that only returns to levels right in the middle of the past couple of years’ range.
Before seasonal adjustment, initial claims totaled 274.7K. That’s not much different from what has been observed in recent years for this time as it basically unchanged year over year, slightly above 2021 and 2022 levels, and slightly below pre-pandemic levels from 2018 and 2019. As shown in the second chart below, the end of the year has typically seen claims rise before peaking shortly into the new year. Given claims have largely followed standard seasonal patterns, there’s still a couple of weeks to go in which claims will likely continue to rise until what can be expected to be the seasonal and annual high.
With initial claims simply following seasonal patterns and not rising or falling in any notable or concerning way, continuing claims are a bit different. After seasonal adjustment, continuing claims jumped to 1.91 million. In the grand scheme of things, that is still relatively low and ranks in the bottom quintile of the historical range. That being said, the most recent reading narrowly surpassed the highs from November marking the first reading above 1.9 million since November 2021.
In the charts below, we again show the chart of seasonally adjusted continuing claims in addition to its six-month rate of change, but with a red dot for each time when the level of claims came in at a 3+ year high. As shown, claims are at an interesting crossroads. On the one hand, similar instances of a multi-year high in continuing claims have only been observed in or immediately surrounding recessions. On the other hand, the current level of claims is much lower than other recessionary periods and other three-year highs in recent decades. Additionally, the uptick in claims over the past six months is the smallest of any of these prior instances of a three-year high in claims.
