December’s ECB Cheat Sheet: A Reality Check For Ultra-Dovish Expectations
The ECB will almost surely keep rates on hold at the December meeting. The question is to what extent it will align with the market’s aggressive pricing for rate cuts in 2024. We suspect it will fall short of endorsing ultra-dovish expectations. There is some upside room for EUR rates and the battered euro. Heading into the […]
Have Stock Traders Front-Run Santa Claus?
Yesterday we highlighted just how rapidly the market has adjusted its expectations for rate cuts. We pointed out that in the aftermath of the last FOMC meeting, Fed Funds futures were pricing in a high likelihood for a 25-basis point cut by June and three 25bp cuts by December, but we are now pricing in a […]
Is It Beginning To Look A Lot Like Christmas?
Image Source: Pexels In this episode, we discuss the impact of recent macroeconomic events, including the Federal Reserve’s monetary policy, on financial markets. They analyze the market’s reaction to Janet Yellen’s announcement on treasury issuance and Jerome Powell’s speech, which they perceive as more hawkish than expected. They also delve into the implications of bond market […]
Lagged Effects Of Epic Tightening Cycle Will Intensify In 2024
Photo by Michelle Spollen on Unsplash Equifax Canada reports that Canadian households added $80 billion of additional consumer debt over the past year, taking the total outstanding an eye-watering $2.4 trillion.Well beyond paycheck to paycheck, many are living credit card to credit card. The average Canadian credit card balance rose to $4,119 in the third quarter, up from $3,727 […]
Navigating The Yen Surge In A Shifting Economic Landscape
Yen. Image Source: Pixabay In a surprising turn of events, the yen experienced a remarkable surge, marking its most substantial one-day rally in nearly a year. Triggered by an unexpected hint from the Bank of Japan (BOJ) about a potential policy shift, markets reacted, particularly in terms of yen conversion. This article explores the implications of the BOJ’s […]
Seasonal Surge In Claims
This morning’s release of Jobless claims came right in line with estimates of 220K and is only marginally higher than last week’s upwardly revised number of 219K. On a four-week moving average basis, claims have totaled 220.75K, matching the level from three weeks ago.As we noted last week, before seasonal adjustment, claims usually increase throughout […]
Pessimism Has A Hair-Trigger, Optimism Not So Much
“Davidson Submits:The SP500 Net Non-Commercial Futures Positions series was updated yesterday at -80.1, a 90pt decline from 30 days ago. Investors following price-trends remain very skittish. SP500 history shows that pessimists have used a rise often as an opportunity to increase negative bets. Meanwhile, Real Retail Sales and the Trucking Tonnage indices continue along their prior uptrends which provides […]
Central Banks And Geopolitics To Support Gold In 2024
Image Source: Pixabay Gold may not have managed to sustain the record high from the start of the week but it has remained firmly above $2,000. At the time of writing it is trading just below $2,050, a key resistance level. The price has shown very little interest in the usually much anticipated US jobs report, […]
Pictures Of Lilly
Even I’m not crazy enough to short this thing, but good God, just look at Eli Lilly (LLY). It’s a straight blast higher, day after day, and it has a price/earnings ratio in the triple digits. Are they expecting a cure for every form of cancer in the next few weeks? As for the market in general […]
Nasdaq Up Triple Digits; Dow Struggling To Keep Up
Stocks are mostly higher this afternoon, as Wall Street continues to sift through the latest jobless data ahead of tomorrow’s highly anticipated jobs report, which will likely inform the Federal Reserve’s next steps.At last glance, the Nasdaq Composite (IXIC) is up triple digits following Alphabet’s (GOOGL) launch of its Gemini artificial intelligence (AI) model. Meanwhile, the Dow Jones Industrial Average […]
