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CHART OF THE DAY: A Prime Example of Central Planning Failure

Editor's Note: Below is a brief chart from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more.

 

"... We’ll get into much more detail on how the #BeliefSystem is breaking down in both Japan and Europe on our Q2 Global Macro Themes Call at 11AM EST, but at a basic level here were some basic rules that levered macro strategies used to get paid by:

 

  1. BOJ (Bank of Japan) prints, devalues, and prints => Yen falls => Japanese Stocks rise
  2. ECB (European Central Bank) says “whatever it takes” => Euro falls => European Stocks rip"

 

CHART OF THE DAY: A Prime Example of Central Planning Failure - 04.07.16 chart


Replay: Healthcare Q&A with Tom Tobin | $ZBH $AHS $MD $HCA $HOLX

CLICK HERE to access the associated slides.

 

Healthcare analysts Tom Tobin an Andrew Freedman hosted a live Q&A today to review their latest research and answer your questions.

 


Cartoon of the Day: Listen Up!

Cartoon of the Day: Listen Up! - Yellen cartoon 04.06.2016

 

All eyes on the Fed today, ahead of the release of the FOMC minutes.


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%

A Brief Warning On Q1 Earnings

Takeaway: Be very careful out there.

A Brief Warning On Q1 Earnings - earnings cartoon 01.27.2015

 

Think first quarter earnings are growing gangbusters? Think again.

 

Here's the latest from our Macro team in a note sent to subscribers this morning:

 

"Q1 earnings season kicks-off next week with the bulge bracket banks leading the way (JPM next Wednesday). If you think we’ll follow-up an awful Q4 2015 reporting season (S&P revs -4.0% Earnings -6.9%) with a rebound, think again. We won’t be lapping bad comps until at least Q3 of this year (reported in Q4). In Q1 of 2015, 8/10 sectors saw Y/Y earnings growth, and the one sector with awful earnings was energy, where WTI averaged $48.57 vs. $33.63 in Q1 0f this year. Don’t get excited about Q1 earnings season. It will be more of the same. #thecycle."

 

Here's the chart highlighting why all of this is so significant.

 

A Brief Warning On Q1 Earnings - z 77

 

 


ISM Services: The Cycle Peaked In July 2015

ISM Services: The Cycle Peaked In July 2015 - sine of the times cartoon 03.03.2016

 

It's all about the Rate of Change...

 

While many on Wall Street cheered an expectations-beating sequential uptick in the ISM Services index, one data point does not make a trend. More importantly, the Services index and its individual components continue to trend lower year-over-year.

 

Here's some brief analysis from our Macro team in a note sent to subscribers earlier this morning:

 

"While industrial activity has stabilized against 13 months of negative comps, domestic service sector activity continues to slow off its mid-2015 highs. Headline ISM Services along with the Employment and New Orders components improved sequentially in March but the 9-month trend remains one of lower highs and lower lows.  On the Labor Front, the trend has been similar as yesterday’s JOLTS data for February showed Job Openings decline by -159K, continuing the 8-month retreat off the mid-2015 peak."

 

Here's the key chart on ISM Services

(Notice the peak in July 2015 and the year-over-year slowing in the data)

 

Stick with the process. Don't get sucked into Wall Street's storytelling. 

 

ISM Services: The Cycle Peaked In July 2015 - Math   Myth cartoon 03.30.2016


CHART OF THE DAY: Post-NIRP, European & Japanese Stocks Still Crashing

Editor's Note: Below is a brief excerpt and chart from today's Early Look written by Hedgeye Director Darius Dale. Click here to learn more.

 

"... In light of all the above, it’s easy to see why European and Japanese capital markets are imploding. The EuroStoxx 600 Index and TOPIX Index have crashed -20.7% and -25% from their respective 52-week closing price highs. Bank stocks are feeling the brunt of the pain amid NIRP-fueled scrutiny of their business models. Specifically, the EuroStoxx Banks Index has crashed -24.6% YTD, while the TOPIX Banks Index has crashed -22.6% from the BoJ’s 1/29 announcement of NIRP."

 

CHART OF THE DAY: Post-NIRP, European & Japanese Stocks Still Crashing - 4 6 Chart of the Day


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