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Volatility (Can You Feel It?)

Client Talking Points

VIX

Volatility is in a bullish breakout TREND in our Hedgeye model and will continue to be provided that front-month VIX is greater than 14.91. The key question going into and out of the January jobs report tomorrow is whether the VIX breaks out above the October 2013 highs of 20.41? That would be bad.

EUROPE

Italy, Spain, DAX all jumped about 1% on the bounce. European Equities continue to beat US Equities year-to-date. But careful, this bounce A) is a low-volume bounce and B) It still isn’t back above important TREND lines like 3049 in the EuroStoxx50. We are watching this closely. 

UST 10YR

So the 10-year yield bounced off its year-to-date lows to 2.68%. But it looks the same as everything US equities – bounce to lower-highs, but remains below our Hedgeye TREND resistance of 2.79% into the jobs report. Bonds are still saying US #GrowthSlowing. 

Asset Allocation

CASH 50% US EQUITIES 4%
INTL EQUITIES 5% COMMODITIES 15%
FIXED INCOME 10% INTL CURRENCIES 16%

Top Long Ideas

Company Ticker Sector Duration
FXB

We remain bullish on the British Pound versus the US Dollar, a position supported over the intermediate term TREND by prudent management of interest rate policy from Mark Carney at the BOE (oriented towards hiking rather than cutting as conditions improve) and the Bank maintaining its existing asset purchase program (QE). UK high frequency data continues to offer evidence of emergent strength in the economy, and in many cases the data is outperforming that of its western European peers, which should provide further strength to the currency. In short, we believe a strengthening UK economy coupled with the comparative hawkishness of the BOE (vs. Yellen et al.) will further perpetuate #StrongPound over the intermediate term.

DRI

Darden is the world’s largest full service restaurant company. The company operates +2000 restaurants in the U.S. and Canada, including Olive Garden, Red Lobster, LongHorn and Capital Grille. Management has been under a firestorm of criticism for poor performance. Hedgeye's Howard Penney has been at the forefront of this activist movement since early 2013, when he first identified the potential for unleashing significant value creation for Darden shareholders. Less than a year later, it looks like Penney’s plan is coming to fruition. Penney (who thinks DRI is grossly mismanaged and in need of a major overhaul) believes activists will drive material change at Darden. This would obviously be extremely bullish for shareholders and could happen fairly soon driving shares materially higher.

JPM

JPMorgan shares are currently trading with the most implied upside to fair value in our fair value model for money-center, super-regional and regional bank stocks. By our estimates, JPM shares have upside of 33% based on our regression of EVA (economic value added) – which looks at the spread between return on capital and cost of capital – and the current multiple to tangible book value. Over time, we have found that sizeable discounts and premiums mean revert toward fair value giving JPMorgan an embedded tailwind in 2014.

Three for the Road

TWEET OF THE DAY

JAPAN: Nikkei continues to suck wind, down another -0.2% to -13.1% YTD #bearisk TREND @KeithMcCullough

QUOTE OF THE DAY

"If you deliberately set out to be less than you are capable, you'll be unhappy for the rest of your life." - Abraham Maslow

STAT OF THE DAY

In its first report as a publicly traded company, Twitter witnessed the wrath of Wall Street, when its monthly user numbers came in lighter than predicted. Its frothy stock has plummeted 22% in pre-market trading.


ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters

Takeaway: Retail mutual funds continued their lagged correlation with equity inflow while institutional ETFs reflect global equity fears

Investment Company Institute Mutual Fund Data and ETF Money Flow:

 

Total equity mutual funds experienced another week of inflow as the lagged effect of fund flow chasing performance from last year has been strong enough to offset near term worries about emerging markets. Within the total equity fund result, domestic equity mutual funds had $1.8 billion of inflow in the most recent 5 day period, just ahead of the 2014 weekly average for domestic funds of $1.4 billion in inflow. International equity funds netted more than domestic funds posting a $3.5 billion inflow. This most recent result coupled with the strong result from the week prior has now moved the 2014 weekly average for total equity mutual funds to a $4.9 billion inflow average to start 2014, a continuation on 2013's positive trends where $3.0 billion per week on average flowed into total stock funds. 

 

Fixed income mutual funds had continued net outflows during the most recent week, a continuation from the negative performance of 2013. In the week ending January 29th, total fixed income mutual funds experienced a $896 million outflow, which broke out into a $1.4 billion redemption in taxable bonds and a $520 million inflow into tax-free bonds, the third straight week of inflow for munis. The 2014 weekly average for fixed income mutual funds now stands at a $635 million weekly inflow, an improvement from 2013's weekly average outflow of $1.5 billion but a far cry from the $5.8 billion weekly average inflow from 2012 (our view of the blow off top in the bond market).

 

ETFs, a more institutional product, reflected the nascent risks in emerging markets and slightly weaker U.S. economic data with a massive outflow in stock ETFs and a slight redemption in fixed income ETFs. Stock ETFs lost a substantial $13.2 billion in the 5 day period ending January 29th, the biggest weekly outflow in our data set spanning 18 months of information, with bond ETFs experiencing a $639 million redemption. The 2014 weekly averages considering this latest data are now a $3.0 billion weekly outflow for equity ETFs and a $22 million weekly inflow for fixed income ETFs. 

 

The net of total equity mutual fund and ETF trends against total bond mutual fund and ETF flows totaled a negative $6.2 billion spread for the week (-$7.7 billion of total equity outflows versus the -$1.5 billion outflow within fixed income; positive numbers imply inflows for stocks; negative numbers imply inflows for bonds). The 52 week moving average has been $7.3 billion (positive spread to equities), with a 52 week high of $30.9 billion (positive spread to equities) and a 52 week low of equity/debt weekly spread of -$9.2 billion (negative numbers imply a net inflow into bonds for the week). 

 

In last week's ICI report, we outlined the historical relationship between retail mutual fund flows and market performance. In analyzing 12 years worth of data, our research shows that fund flow chases or lags performance by 6 months for equities and 9 months for fixed income (the best fit line between these two variables). Thus the strong return for stocks in 2013 of 30% in the S&P 500 and the first loss in the Barclay's Aggregate bond index in 14 years is still driving the direction of retail fund flows currently (see late week's report here). 

 

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart10

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart11

 

 

 

Most Recent 12 Week Flow in Millions by Mutual Fund Product:

 

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart3

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart4

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart5

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart6

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart7

 

 

Most Recent 12 Week Flow Within Equity and Fixed Income Exchange Traded Funds:

  

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart8

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart9

 

 

Net Results:

 

 

The net of total equity mutual fund and ETF trends against total bond mutual fund and ETF flows totaled a negative $6.2 billion spread for the week (-$7.7 billion of total equity outflows versus the -$1.5 billion outflow within fixed income; positive numbers imply inflows for stocks; negative numbers imply inflows for bonds). The 52 week moving average has been $7.3 billion (positive spread to equities), with a 52 week high of $30.9 billion (positive spread to equities) and a 52 week low of equity/debt weekly spread of -$9.2 billion (negative numbers imply a net inflow into bonds for the week). 

 

 

ICI Fund Flow Survey - Retail Mutual Funds Inflow While ETFs Reflect Global Jitters - ICI chart12

 

 

 

Jonathan Casteleyn, CFA, CMT 

 

 

 

Joshua Steiner, CFA

 


Fighting Growth Bulls

“After the fight is over the winning animal emerges with even higher levels of testosterone.”

-John Coates

 

The thing about fighting bulls are those damn horns. No matter what the math, data, or weather, the perma ones are really stubborn too. They’ll just sit there sometimes and stare at you. So, when you’re a bear, it’s better to attack them from behind.

 

The aforementioned quote comes from a chapter in The Hour Between Dog and Wolf that John Coates calls The Fuel of Exuberance. “Biologists studying animals in the field had noticed that an animal winning a fight or a competition for turf was more likely to win its next fight” (pg 166).

 

Fighting Growth Bulls - bulls

 

Sounds like trending bullish and bearish price momentum to me. All our back-tests show the most powerful ramps in market emotion (fear and greed) occur when there is a reversal from bearish to bullish (or bullish to bearish) on our intermediate-term TREND duration. In other words, bear vs. bull fights matter; especially at the big TREND turns.

 

Back to the Global Macro Grind

 

From a #behavioral market strategy perspective, does the “Winner Effect” (Coates) matter? Big time. Why? It especially matters in modern markets because, newsflash: machines chase price.

 

What are the most interesting bullish-to-bearish reversals in the @Hedgeye quant model right now?

  1. Nikkei reversing to bearish TREND
  2. SP500 reversing to bearish TREND
  3. 10yr US Treasury Yield reversing to bearish TREND

How about the most interesting bearish-to-bullish reversals in TREND?

  1. Commodities (CRB Commodities Index) reversing to bullish TREND
  2. Utilities (XLU) reversing to bullish TREND
  3. Fear (VIX) reversing to bullish TREND

From a Global Macro Theme perspective it’s easy to explain why all 6 of these intermediate-term TREND reversals rhyme: with #InflationAccelerating, growth expectations in Japan and the US are slowing.

 

These same risk management signals started to manifest in Q1 of 2008 (that’s why we got so bearish on the US consumer back then), but they also started to coagulate again in Q1 of 2011.

 

2011 was a very interesting year in that while US stocks (SP500) closed flat on the year:

  1. Fear (VIX) ripped from 15 to 24 in Q1 of 2011
  2. Utilities (XLU) and Treasuries (TLT) marched steadily higher (relative and absolute) throughout 2011
  3. Commodities (CRB Index) had a monster Q1 of 2011

Fast forward to mid-Q1 of 2014 and here’s the score:

  1. Nikkei -13.1% YTD
  2. SP500 -5.2% YTD
  3. US Treasuries (TLT) +5.2% YTD
  4. CRB Commodities Index +2.5% YTD
  5. Utilities (XLU) +1.1% YTD
  6. Fear (VIX) +45.4% YTD

Just saying.

 

Oh, and there was that “financial innovation” thing (a Policy to Inflate asset prices; especially Bonds and Commodities) that eventually caused the all-time highs in commodities like Gold in Q3 of 2011 called the quantitative easing…

 

So, play it forward – what do you think the Mother of All Doves (Yellen) is going to do if US growth continues to slow? Bernanke didn’t go to Jackson Hole last year, but I’m betting that she’ll strap on the cowboy pants and start printing again.

 

I know, Hilsenrath hasn’t leaked that probability memo to the bulls or bears yet. But Mr. Macro Market has. So keep your head on a swivel out there as these currency devaluation and money printing animals at the Federal Reserve still think they’re winning.

 

Our immediate-term Global Macro Risk Ranges are now:

 

SPX 1

Nikkei 132

VIX 15.81-20.41

USD 80.93-81.46

NatGas 5.05-5.51

Gold 1

 

Best of luck out there today,

KM

 

Keith R. McCullough
Chief Executive Officer

 

Fighting Growth Bulls - drake1


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THE HEDGEYE DAILY OUTLOOK

TODAY’S S&P 500 SET-UP – February 6, 2014


As we look at today's setup for the S&P 500, the range is 37 points or 0.84% downside to 1737 and 1.28% upside to 1774.                

                                                                                                               

SECTOR PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - 1

 

THE HEDGEYE DAILY OUTLOOK - 2

 

EQUITY SENTIMENT:

 

THE HEDGEYE DAILY OUTLOOK - 10                                                                                                                                                                  

 

CREDIT/ECONOMIC MARKET LOOK:

  • YIELD CURVE: 2.36 from 2.36
  • VIX  closed at 19.95 1 day percent change of 4.40%

MACRO DATA POINTS (Bloomberg Estimates):

  • 7am: RBC Consumer Outlook Index, Feb. (prior 51.5)
  • 7:30am: Challenger Job Cuts, y/y, Jan. (prior -5.9%)
  • 8:30am: Trade Balance, Dec., est. -$36b (prior -$34.3b)
  • 8:30am: Nonfarm Productivity, 4Q preliminary, est. 2.8%
  • 8:30am: Initial Jobless Claims, Feb. 1, est. 335k (pr 348k)
  • 9:45am: Bloomberg Consumer Comfort, Feb. 2 (prior -31.8)
  • 10am: Fed’s Tarullo Senate testimony on financial stability
  • 10am: Freddie Mac mortgage rates
  • 10:30am: DOE Energy Inventories
  • 5:30pm: Fed’s Rosengren speaks in Sarasota, Fla.

GOVERNMENT:

    • 9:30am House Oversight and Govt Reform Cmte hearing on IRS targeting investigation
    • 10am: Fed’s  Daniel Tarullo testifies before Senate Banking Cmte’s “Oversight of Financial Stability and Data Security"; w/Treasury Under Sec. Mary Miller; FDIC Chairman Martin Gruenberg; Comptroller of the Currency Tom Curry; SEC Chairwoman Mary Jo White; Acting CFTC Chairman Mark Wetjen

WHAT TO WATCH:

  • Coca-Cola to buy 10% stake in Green Mountain for $1.25b
  • Twitter’s easy growth stalls as CEO vows to address slowdown
  • Jan. retail sales seen hurt by clearance, weather
  • Sony sees full-yr loss; plans job cuts, sale of PC business
  • Disney’s profit tops ests. as "Frozen" heats up box office
  • Apple removes Bitcoin program Blockchain from app store
  • SoftBank said to seek decision on T-Mobile bid within wks
  • Buyout firms CVC to Carlyle said to weigh bid for Deoleo
  • Credit Suisse 4Q profit misses ests. on legal provisions
  • GM adds Nissan-built cargo van to take on Ford Transit Connect
  • U.S. said near deal with EU on reprieve for swap-trading rules
  • IBM to spend $100m to bring Watson technology to Africa
  • Ford to cut third of Australia plant jobs as demand declines
  • Amazon buys video game developer Double Helix: Re/code

AM EARNS:

    • Advance Auto Parts (AAP), 8:30am, $0.81
    • Aetna (AET), 6am, $1.36
    • AOL (AOL), 7am, $0.61 - Preview
    • Apollo Investment (AINV), 7:30am, $0.21
    • Carlisle (CSL), 6am, $0.87
    • Cummins (CMI), 7:30am, $1.97 - Preview
    • Diamond Offshore Drilling (DO), 6am, $0.81 - Preview
    • Dunkin’ Brands Group (DNKN), 6am, $0.40
    • Exelon (EXC), 7:30am, $0.54
    • Flowers Foods (FLO), 6am, $0.19
    • Fortis (FTS CN), 7am, C$0.48
    • Gartner (IT), 7am, $0.69
    • General Motors (GM), 7:30am, $0.87 - Preview
    • Graphic Packaging Holding (GPK), 7:30am, $0.10
    • Kellogg (K), 8am, $0.82 - Preview
    • KKR (KKR), 8am, $0.89
    • Monster Worldwide (MWW), 7:30am, $0.11
    • New Gold (NGD CN) 7:30am, $0.04 - Preview
    • New York Times (NYT), 8:30am, $0.16
    • Nu Skin Enterprises (NUS), 7:30am, $2.01
    • Och-Ziff Capital Mgmt (OZM), 7:30am, $0.83
    • Patterson-UTI Energy (PTEN), 6am, $0.22
    • Perrigo (PRGO), 7:42am, $1.60
    • Philip Morris International (PM), 6:59am, $1.37 - Preview
    • PPL (PPL), 7am, $0.50
    • Sally Beauty Holdings (SBH), 7:30am, $0.36
    • Saputo (SAP CN) 11:59am, C$0.74
    • Sealed Air (SEE), 7:30am, $0.37
    • Shoppers Drug Mart (SC CN) 7:45am, C$0.86
    • Sigma-Aldrich (SIAL), 7am, $1.01
    • Snap-on (SNA), 7am, $1.56
    • Spirit Aerosystems Holdings (SPR), 7:30am, $0.65
    • Teradata (TDC), 6:55am, $0.85
    • Teva Pharmaceutical Industries (TEVA), 7am, $1.40 - Preview
    • Towers Watson (TW), 6am, $1.33
    • Twenty-First Century Fox (FOXA), 8am, $0.33 - Preview
    • USG (USG), 8:30am, $0.10 - Preview
    • Wisconsin Energy (WEC), 7am, $0.59

PM EARNS:

    • Activision Blizzard (ATVI), 4:05pm, $0.73
    • Expedia (EXPE), 4pm, $0.85 - Preview
    • Fifth Street Finance (FSC), 4:37pm, $0.25
    • FMC Technologies (FTI), 4pm, $0.65
    • Genpact(G), 4pm, $0.26
    • LinkedIn (LNKD), 4:05pm, $0.38 - Preview
    • Lions Gate Entertainment (LGF), 4pm, $0.47
    • NCR (NCR), 4:02pm, $0.79
    • Neurocrine Biosciences (NBIX), 4:02pm, ($0.17)
    • News (NWSA), 4:05pm, $0.19
    • Noble Energy (NBL), 5pm, $0.59
    • ON Semiconductor (ONNN), 4:05pm, $0.14
    • Republic Services (RSG), 4:05pm, $0.46
    • Tempur Sealy (TPX), 4:03pm, $0.62
    • Ubiquiti Networks (UBNT), 4:05pm, $0.45
    • VeriSign (VRSN), 4:05pm, $0.60

COMMODITY/GROWTH EXPECTATION (HEADLINES FROM BLOOMBERG)

  • WTI Crude Rises a Third Day as U.S. Chill Erodes Fuel Stockpiles
  • Cotton Crop in Australia Declining to Three-Year Low on Drought
  • Virus Killing 5 Million Pigs Spurs Hog-Price Rally: Commodities
  • U.S. Natural Gas Rises as Inventories Seen Declining on Weather
  • Nickel Rises Amid Speculation Stainless Steel Will Fuel Demand
  • Gold Reversal May Signal Lows for U.S. Stocks: Chart of the Day
  • Wheat Trades Near Highest in Three Weeks Amid Signs of Demand
  • Arabica Coffee Falls First Time in 8 Days; Sugar Little Changed
  • Japan Turns to U.S. Wheat Amid Delays in Shipments From Canada
  • Rice Farmers in Thailand Urge Stockpile Sales to Meet Payments
  • World Food Prices Drop to 19-Month Low as Sugar to Grains Slide
  • Tightly Knit Europe Gas Grid Matches Local Need With Global Feed
  • Oman’s $3 Billion Railroad Plan to Blunt Iran Oil Risk: Freight
  • Gold Holds Below 1-Week High as Silver Extends Best Run in Month

THE HEDGEYE DAILY OUTLOOK - 5

 

CURRENCIES

 

THE HEDGEYE DAILY OUTLOOK - 6

 

GLOBAL PERFORMANCE

 

THE HEDGEYE DAILY OUTLOOK - 3

 

THE HEDGEYE DAILY OUTLOOK - 4

 

EUROPEAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 7

 

ASIAN MARKETS

 

THE HEDGEYE DAILY OUTLOOK - 8

 

MIDDLE EAST

 

THE HEDGEYE DAILY OUTLOOK - 9

 

 

The Hedgeye Macro Team

 

 

 

 

 

 

 

 

 

 

 

 

 


February 6, 2014

February 6, 2014 - Slide1 

BULLISH TRENDS

February 6, 2014 - Slide2

February 6, 2014 - Slide3

February 6, 2014 - Slide4

 

BEARISH TRENDS

February 6, 2014 - Slide5

February 6, 2014 - Slide6

February 6, 2014 - Slide7

February 6, 2014 - Slide8

February 6, 2014 - Slide9

February 6, 2014 - Slide10

 

 


Theory vs Practice

This note was originally published at 8am on January 23, 2014 for Hedgeye subscribers.

“In theory, there is no difference between theory and practice. In practice there is.”

-Yogi Berra

 

I had a ton of feedback on yesterday’s Early Look (on how and why I use Twitter), so I wanted to thank you for that. Without having to answer to and consider your objective questions and thoughts, I’d just be a man in a room who is hostage to my own thinking. #scary

 

Your feedback generates more questions and ideas for our research team to work on. So I decided to take 6 minutes to walk through who scores as The 3 Most Overrated Economists in The World (for @HedgeyeTV video CLICK HERE ). I also crowd-sourced (on Twitter) who my followers thought were the most overrated. We came up with completely different answers.

 

Today, I’d like to throw that right back at you and add the follow-on question – who are The Most Underrated Economists (and/or strategists) that you follow? This has nothing to do with being mean or nice. This has everything to do with competence. We all need to find a better way. In theory, there are “experts” spewing on TV all day long. In practice, you (the players) know who gets it.

 

Back to the Global Macro Grind

 

#Davos is a big deal. CNBC focused on Matt Damon’s "Save the World’s Water" thing yesterday and Reuters is all over actress Goldie Hawn this morning. Up next, after living large last night, Nouriel Roubini is Snapchatting the world a picture of him pecking Arianna Huffington on the cheek.

Theory vs Practice - nour5 

Great.


In other news, 2 of our Top 3 Global Macro Themes are trending in markets this morning, big time:

 

1.       #InflationAccelerating
2.       #GrowthDivergences

 

On Inflation, just to clarify:

  1. Our call here is like all the calls we make – rate of change – deflating the inflation (last year’s theme = #over)
  2. We aren’t purely focused on commodity deflation ending; but it’s a big part of the market expectations mismatch
  3. #InflationAccelerating is a bigger problem in the US than it is in Europe (that’s why we like European Equities more)

Got Commodity inflation in 2014 YTD?

  1. CRB Commodities Index (19 commodities) is beating both the Dow and the SP500 YTD (it’s up instead of down)
  2. CRB Food Index = +1.5% YTD (after food prices crashed last year from the 2012 all-time highs)
  3. YTD Food Inflations = Oats +12.9%, Cattle +5.1%, Coffee +3.9%
  4. Natural Gas at $4.76 (don’t tell Washington about heating your home) = +12.9% YTD
  5. Precious Metals YTD = Platinum +6.5%, Palladium +4.3%, Gold +3.7%

In stark contrast to what you would have seen in the Hedgeye Asset Allocation Model for the better part of the last year (0% allocation to Commodities), we have a 9% asset allocation to Commodities right now. From here, that’s going up, not down.

 

In Real-Time Alerts we are long of Gold in Gold terms (GLD) and Coffee via the CAFÉ (take the little chapeau off the French spellchecker and you’ll see the Coffee ETN – not a perfect security, so if you’re an Institutional investor, just buy the futures).

 

On the other side of this Q1 theme, there are plenty of short ideas to sink your teeth into; Restaurant Shorts in particular (Slowing Sales and Rising Food Costs). This is the highest # of short ideas our Food/Bev guru Howard Penney has had since 2008. He held a Best Short Ideas call last week @Hedgeye on Cheesecake Factory (CAKE). And he’ll write the Early Look for you tomorrow.

 

With Roubini going bullish, got short ideas? Here are some high-quality Food #InflationAccelerating ideas currently in Real-Time Alerts:

  1. Cheesecake (CAKE)
  2. Bloomin’ Brands (BLMN)
  3. Red Robin Gourmet Burgers (RRGB)
  4. McDonald’s (MCD)

In other words, 50% of my #timestamped short book is in Restaurant Shorts (10 LONGS, 8 SHORTS currently @Hedgeye after selling into yesterday’s all-time Russell2000 high of 1181).

 

In another @HedgeyeTV video this week titled Here’s What’s Working (for video CLICK HERE), I made a very simple point about our #GrowthDivergences theme (which syncs with #InflationAccelerating): country and sector picking matters as much as stock picking right now (i.e. pick the right sectors in the right countries and you’ll look like a good stock picker!).

 

If you really want to boil that macro point down, for now you want to be:

 

A)     Long Inflation Expectations assets (like breakevens)

B)     Short US Consumption assets (like restaurants)

 

Since the European growth recovery is 1-2 years behind the US (and most of Asia, including Japan), that’s the other reason why we think you’re going to continue to see European Equities outperform the Global Equities league tables.

 

Remember, in theory consensus might think it’s about absolute levels of growth. In practice, it’s all about the rate of change of growth. And that’s all I have to say about that.

 

Our immediate-term Global Macro Risk Ranges are now:

 

SPX 1828-1856

Brent 105.87-108.75

NatGas 4.35-4.77

Gold 1227-1267

Copper 3.30-3.40

 

Best of luck out there today,

KM

 

Keith R. McCullough
Chief Executive Officer

 

Theory vs Practice - Chart of the Day

 

Theory vs Practice - Virtual Portfolio


Hedgeye Statistics

The total percentage of successful long and short trading signals since the inception of Real-Time Alerts in August of 2008.

  • LONG SIGNALS 80.64%
  • SHORT SIGNALS 78.61%
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