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Daily Market Data Dump: Wednesday

Takeaway: A closer look at global macro market developments.

Editor's Note: Below are complimentary charts highlighting global equity market developments, S&P 500 sector performance, volume on U.S. stock exchanges, and rates and bond spreads. It's on the house. For more information on how Hedgeye can help you better understand the markets and economy (and stay ahead of consensus) check out our array of investing products

 

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Daily Market Data Dump: Wednesday - equity markets 6 1

 

Daily Market Data Dump: Wednesday - sector performance 6 1

 

Daily Market Data Dump: Wednesday - volume 6 1

 

Daily Market Data Dump: Wednesday - rates and spreads 6 1

 

Daily Market Data Dump: Wednesday - currencies 6 1


CHART OF THE DAY: Investor Consensus = Bearish On Bonds & U.S. Dollar... WHY?

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

 

"... One such incongruence that needs to work its way through markets is the relatively bearish position on both Treasuries (across the curve) and the U.S. Dollar Index in the futures and options markets.

 

Specifically, the +11.2k net long position on the latter represents a -1.7 z-score on a 1Y basis, while the -148.9k net short position in 2Y notes and -93.5k net short position in 10Y bonds represent z-scores of -1.4 and -1.6, respectively. How can investor consensus be that bearish on bonds amid a hawkish Fed, but not commensurately bullish on the dollar?"

 

CHART OF THE DAY: Investor Consensus = Bearish On Bonds & U.S. Dollar... WHY? - Chart of the Day 6 1


Cartoon of the Day: Janet's Mess

Cartoon of the Day: Janet's Mess - Hawk or dove cartoon 05.31.2016

 

"On Friday at Harvard, Janet Yellen said that, based on her estimate of where the US economy is at, the Federal Reserve will “probably” raise rates in June or July," Hedgeye CEO Keith McCullough wrote in today's Early Look. "Ok. What if she raises and her estimates are wrong (again)?"


Early Look

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Relied upon by big institutional and individual investors across the world, this granular morning newsletter distills the latest and most vital market developments and insures that you are always in the know.

3 Charts: Why We're Still Bearish On U.S. Growth

Takeaway: Our reading of the bond market, consumer confidence, and S&P 500 earnings confirms our U.S. #GrowthSlowing call.

3 Charts: Why We're Still Bearish On U.S. Growth - GDP cartoon 04.26.2016

 

Nothing about today's economic data changes our thinking that U.S. economic growth continues its descent off the cycle peak.

 

Quite the contrary. We’re sticking with our sub-1% GDP forecast for Q2 and the worst profits of #TheCycle in Q2 and Q3. 

 

All is not well in the U.S. economy, particularly in manufacturing. Today's Chicago PMI clocked in a recessionary 49.3 vs. 50.4 last month. Meanwhile, the Dallas Fed Manufacturing Survey fell -13.1%, contracting alongside the four other regional Fed manufacturing surveys.

 

Not good.

 

In the bond market...

 

The yield spread (10-year minus 2-year Treasury) is not budging. It's still at YTD lows of 94 basis points wide. That's a crystal clear U.S. #GrowthSlowing indicator.

 

3 Charts: Why We're Still Bearish On U.S. Growth - 10yr treasury 5 31 today

 

Today's U.S. Consumer Confidence reading did little to inspire, well, confidence. 

 

It slowed (again) in May to 92.6 vs. 94.7 last month. #TheCycle peak was in 1H 2015. Notice what happens to consumer confidence, in the chart below, once it rolls off the cycle peak.

 

3 Charts: Why We're Still Bearish On U.S. Growth - consumer confidence 5 31

 

S&P 500 Earnings are downright terrible.

 

A grand total of 491/498 S&P 500 companies have reported. The results thus far aren't pretty:

  • Aggregate sales and earnings growth have come in at -2.3% and -8.5% respectively;
  • 6/10 sectors have reported negative earnings and sales growth;
  • Energy sales and earnings growth are down -30.1% and -109.1% respectively;
  • Rounding out the bottom of the barrell: Materials sales and earnings growth are down -8.8% and -16% respectively; Financials are down -1.7% and -14.2% respectively;

 

3 Charts: Why We're Still Bearish On U.S. Growth - earnings 5 31


OPEC Meeting Preview: Why $50 Oil Is Cause For Concern

Takeaway: While $50 oil will please most OPEC members, Saudi Arabia's market share policy is based on lower prices for all of 2016.

OPEC Meeting Preview: Why $50 Oil Is Cause For Concern - OPEC cartoon 04.24.2015 normal

 

Hedgeye Potomac Senior Energy analyst Joe McMonigle is in Vienna to attend the June 2 OPEC meeting and participate in various pre-meeting activities this week. Hedgeye will host a OPEC meeting preview conference call on Wednesday, June 1 at 1pm EST with Joe from Vienna and former US Energy Secretary Spencer Abraham from Washington. (For access to the call, email sales@hedgeye.com.)

 

First, we are not expecting any change in OPEC policy (i.e. production freeze or cut) at this meeting but Joe will be watching closely for signals of how OPEC may approach the December meeting after significant declines in US and other non-OPEC supply.

 

While he is not predicting a change in policy, Joe believes the December meeting will be the first time in two years when it will be under serious consideration. Meanwhile, production outages in Canada and Nigeria have pushed oil prices to $50.

 

While that will please most OPEC members, $50 oil is too premature from the viewpoint of Saudi Arabia. The Kingdom's market share policy is based on lower prices for all of 2016; therefore, sustained prices around $50 now will cause concern in Riyadh and could trigger some response.


McCullough: The Call Is Clear, Raise Cash

 

In this brief excerpt from The Macro Show this morning, Hedgeye CEO Keith McCullough issues a stern directive to investors and explains the reasons why.


Daily Trading Ranges

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Daily Trading Ranges is designed to help you understand where you’re buying and selling within the risk range and help you make better sales at the top end of the range and purchases at the low end.

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