Bespoke’s Morning Lineup.
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 free trial to Bespoke Premium. CLICK HERE to learn more and start your free trial.
“The greatest danger in times of turbulence is not the turbulence—it is to act with yesterday’s logic.” – Peter Drucker
After most major US indices closed at record highs yesterday and the dollar finished at multi-year lows, equities are taking a bit of a breather this morning. Reports that talks over a Brexit deal are on the verge of collapsing has contributed to the negative tone, but this morning’s weakness is more related to profit-taking and a pause in the rally than anything else. In economic news, the calendar is quiet here in the US, but Chinese Exports for November, which were released overnight, surged more than expected.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, a discussion of the latest Brexit talks, Chinese trade data, an update on the latest national and international COVID trends, and much more.
The chart below is from the second page of our Morning Lineup and shows the relative strength of the S&P 500 versus the US Long Bond Future over the last year. When the line is in the green zone it indicates that equities are outperforming Treasuries. Conversely, when the line is in the red zone, it indicates that bonds are outperforming stocks. What’s notable about the chart today is that as of Friday, the relative strength of the S&P 500 versus the Long Bond Future is higher now than it has been at any point in the last year.
Bespoke Brunch Reads: 12/6/20
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.
While you’re here, join Bespoke Premium with a 30-day free trial!
Ancient History
A great wave: the Storegga tsunami and the end of Doggerland? by James Walker, Vincent Gaffney, Simon Fitch, Merle Muru, Andrew Fraser, Martin Bates, and Richard Bates (Cambridge University Press)
A review of the history of Doggerland, the delta region between the modern low countries and UK, which was subject to a catastrophic tsunami over 8,000 years ago. [Link]
‘Sistine Chapel of the ancients’ rock art discovered in remote Amazon forest by Dalya Alberge (The Guardian)
Deep in the Amazonian rain forest of Colombia, paintings on rock faces stretching across almost 8 miles reveal a fascinating insight into the pre-historic Americas. [Link]
Breakthroughs
How a Couple’s Quest to Cure Cancer Led to the West’s First Covid-19 Vaccine by Bojan Pancevski (WSJ)
A husband-and-wife team of German scientists whose parents migrated from Turkey were the core of a vaccine development team that turned around the eventual Pfizer product in a period of mere days. [Link; paywall]
Alphabet’s DeepMind achieves historic new milestone in AI-based protein structure prediction by Darrell Etherington (TechCrunch)
This week, Alphabet’s subsidiary DeepMind reported that it had developed a major leap in predicting protein folding, which could lead to much faster biological research and drug development. [Link]
Cultured meat has been approved for consumers for the first time by Niall Firth (MIT Technology Review)
A San Francisco-based start-up has been given preliminary approval to sell its lab-grown meat chicken nuggets in Singapore. While the initial product is very expensive and also relies on plant proteins, the move towards commercialization gives a peak into the potential for synthetic meat, a holy grail for vegans and climate activists alike. [Link; soft paywall]
Why Is Apple’s M1 Chip So Fast? By Erik Engheim (Debugger)
The chip Apple has developed in-house for its latest line of Mac computers represents a truly epic leap in terms of both technical approach and competitive landscape. [Link]
The Times They Are A-Changin’
Peak Oil Is Suddenly Upon Us by Tom Randall and Hayley Warren (Bloomberg)
COVID has brought forward an almost unthinkable reality: maximum oil demand. A look at what that might mean for the future of the global economy. [Link; soft paywall]
House passes historic bill to decriminalize cannabis by Alicia Victoria Lozano (NBC)
In a vote that mostly broke down on party lines (Democrats mostly in favor, Republicans mostly opposed) the House passed a historic bill that would remove pot from the Controlled Substances Act. [Link; auto-playing video]
How The Tumult of 2020 Will Shape the Future of Ride Sharing (Wired)
A podcast discussing the very strange ride for ridesharing giants which have been brought low by the pandemic…but offered some new opportunities as well. [Link; soft paywall]
Disaster
Huge Puerto Rico radio telescope, already damaged, collapses by Dánica Coto (PhysOrg)
The massive radio telescope dish of the Arecibo Observatory in Puerto Rico has collapsed, with the receiver assembly collapsing after a cable snapped back in August. [Link]
Death by PowerPoint: the slide that killed seven people (McDreeamie-Musings)
One potential reason for the Columbia shuttle disaster which killed its crew in 2003 was a poorly-designed slide in PowerPoint that was used to create a risk assessment. [Link]
Bad Calls
One country tells Apple to put a wall charger in iPhone 12 box by Trevor Mogg (digitaltrends)
Apple has been told by a Brazilian state regulator to include a wall charging unit compatible with the USB-C cords it includes with its new iPhone 12 or face a fine. [Link]
David Einhorn Has Made a Lot of Bad Bets — And One Very Good One by Katherine Burton (Bloomberg)
Since 2015, Greenlight Capital has lost 34%, with a slew of bad investments weighing returns. This year, the fund is flat thanks to a 15% gain for a homebuilder that the fund owns half of. [Link; soft paywall]
Policy
In Blue States and Red, Pandemic Upends Public Services and Jobs by Patricia Cohen (NYT)
Plunging tax receipts are forcing state and local governments to cut back, extending the economic pain of the COVID recession. [Link; soft paywall]
Bros
Bro Culture, Fitness, Chivalry, and American Identity by Patrick Wyman (Substack)
A deep investigation into bro culture, from the gym floor to the coffee grinder. Wyman ties his narrative into the medieval past as well as the contemporary reality of American bros. [Link]
Hungarian MEP admits he was at lockdown ‘orgy’ by Maïa De La Baume (Politico)
Brussels policy broke up a lockdown party this week with explosive results: a Hungarian MEP closely allied to Hungarian Viktor Orbán was in attendance at a gay orgy. This wouldn’t be remarkable if it wasn’t for the Orbán government’s long track record of LGBTQ suppression. [Link]
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Have a great weekend!
The Bespoke 50 Top Growth Stocks — 12/4/20
Every Thursday, Bespoke publishes its “Bespoke 50” list of top growth stocks in the Russell 3,000. Our “Bespoke 50” portfolio is made up of the 50 stocks that fit a proprietary growth screen that we created a number of years ago. Since inception in early 2012, the “Bespoke 50” has beaten the S&P 500 by 207.6 percentage points. Through today, the “Bespoke 50” is at new all-time highs and up 376.2% since inception versus the S&P 500’s gain of 168.5%. Always remember, though, that past performance is no guarantee of future returns. To view our “Bespoke 50” list of top growth stocks, please start a two-week free trial to either Bespoke Premium or Bespoke Institutional.
The Bespoke Report – A Good Month in Four Days
If you were expecting a bit of a pullback to start December after November’s big gains, it didn’t come this week. While November’s performance for the US and global equities was the equivalent of a good year, December’s MTD returns already would be considered a great month! Major US equity indices are all up 2% already, and the small-cap Russell 2000 is up close to 4%. Every sector with the exception of Utilities is also up on the month, but Energy is by far the biggest winner with a gain of over 10%. Even after that gain, though, it is still down nearly 30% on the year. In international markets, we’ve also seen big gains with countries like Brazil, Mexico, Spain, Russia, and the UK all up over 5%. Lastly, as one might expect given the big gains in equities, bonds are all lower on the month with the most weakness at the long end of the curve.
This week’s Bespoke Report is a bit shorter than normal as we have also started to publish various sections of our annual Bespoke Report Market Outlook. To view this week’s Bespoke Report as well as our Annual Outlook report as it’s published, take advantage of our 2021 Annual Outlook Special.
This week’s Bespoke Report newsletter is now available for members.
To read the report and access everything else Bespoke’s research platform has to offer, start a two-week free trial to one of our three membership levels. You won’t be disappointed!
2021 Outlook – Credit
Our 2021 Bespoke Report market outlook is the most important piece of research that Bespoke publishes each year. We’ve been publishing our annual outlook piece since the formation of Bespoke in 2007, and it gets better every year! In this year’s edition, we’ll be covering every important topic you can think of that will impact financial markets in 2021.
The 2021 Bespoke Report contains sections like Economic Cycles, The Fed, Sector Technicals and Weightings, Stock Market Sentiment, Stock Market Seasonality, Housing, Commodities, and more. We’ll also be publishing a list of our favorite stocks and asset classes for 2021 and beyond.
We’ll be releasing individual sections of the report to subscribers until the full publication is completed by year-end. Today we have published the “Housing” section of the 2021 Bespoke Report, focusing on the wild ride taken by credit markets over the course of 2020 and the outlook for 2021. We review the long-term history of corporate debt yields and spreads to benchmark interest rates, as well as looking at what the current backdrop implies for equity markets. We finish with a preview of what might become the biggest focus for credit markets in 2021.
To view this section immediately and all other sections, become a member with our 2021 Annual Outlook Special!
2021 Outlook – Housing
Our 2021 Bespoke Report market outlook is the most important piece of research that Bespoke publishes each year. We’ve been publishing our annual outlook piece since the formation of Bespoke in 2007, and it gets better every year! In this year’s edition, we’ll be covering every important topic you can think of that will impact financial markets in 2021.
The 2021 Bespoke Report contains sections like Economic Cycles, The Fed, Sector Technicals and Weightings, Stock Market Sentiment, Stock Market Seasonality, Housing, Commodities, and more. We’ll also be publishing a list of our favorite stocks and asset classes for 2021 and beyond.
We’ll be releasing individual sections of the report to subscribers until the full publication is completed by year-end. Today we have published the “Housing” section of the 2021 Bespoke Report, focusing on the recent data and outlook for housing markets and homebuilders. We review affordability, construction data, activity in the existing and new home markets, data and drivers for homebuilder stocks, and finally a review of the impact COVID has had on mortgage delinquencies.
To view this section immediately and all other sections, become a member with our 2021 Annual Outlook Special!
2021 Outlook – Washington
Our 2021 Bespoke Report market outlook is the most important piece of research that Bespoke publishes each year. We’ve been publishing our annual outlook piece since the formation of Bespoke in 2007, and it gets better every year! In this year’s edition, we’ll be covering every important topic you can think of that will impact financial markets in 2021.
The 2021 Bespoke Report contains sections like Economic Cycles, The Fed, Sector Technicals and Weightings, Stock Market Sentiment, Stock Market Seasonality, Housing, Commodities, and more. We’ll also be publishing a list of our favorite stocks and asset classes for 2021 and beyond.
We’ll be releasing individual sections of the report to subscribers until the full publication is completed by year-end. Today we have published the “Washington” section of the 2021 Bespoke Report, which recaps market scenarios under different political compositions in DC as well as some important comparisons between this election and 2016’s.
To view this section immediately and all other sections, become a member with our 2021 Annual Outlook Special!
2021 Outlook – Valuation
Our 2021 Bespoke Report market outlook is the most important piece of research that Bespoke publishes each year. We’ve been publishing our annual outlook piece since the formation of Bespoke in 2007, and it gets better every year! In this year’s edition, we’ll be covering every important topic you can think of that will impact financial markets in 2021.
The 2021 Bespoke Report contains sections like Economic Cycles, The Fed, Sector Technicals and Weightings, Stock Market Sentiment, Stock Market Seasonality, Housing, Commodities, and more. We’ll also be publishing a list of our favorite stocks and asset classes for 2021 and beyond.
We’ll be releasing individual sections of the report to subscribers until the full publication is completed by year-end. Today we have published the “Valuation” section of the 2021 Bespoke Report, which compares current valuations for major indices and sectors to their historical levels at various points in bull and bear markets. We also analyze the earnings yield, price to book ratios, and dividend yields for the S&P 500 relative to history.
To view this section immediately and all other sections, become a member with our 2021 Annual Outlook Special!
Daily Sector Snapshot — 12/4/20
Bespoke’s Morning Lineup – 12/4/20 – Positive Tone into Jobs Report
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 free trial to Bespoke Premium. CLICK HERE to learn more and start your free trial.
“I buy when other people are selling.” – J. Paul Getty
It’s safe to assume then that Mr. Getty hasn’t been buying much lately. Futures are higher again this morning putting the S&P 500 on pace for its fourth positive week in the last five, but in order to get there, we’ll have to get through the November jobs report. There have been some concerns about the health of the jobs market lately, but secondary indicators we track have been holding up relatively well.
Be sure to check out today’s Morning Lineup for updates on the latest market news and events, a discussion of the latest OPEC talks, factory orders in Germany, an update on the latest national and international COVID trends, and much more.
We’ve illustrated the positive breadth in the market in a number of different ways lately, but here’s another. For the last few days now, all 24 of the S&P 500’s Industry Groups have been trading above their 200-DMA. Looking back at the last five years, that doesn’t happen all that often. The last time there was such a high reading was at the start of the year on January 2nd. While the year may be on pace to finish right where it started in terms of breadth, it was far from a straight line as this reading went from 100% down to 0% and back to 100%. You can’t get any wider of a range than that!
