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Daily Market Data Dump: Thursday

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: Thursday - equity markets 6 2

 

Daily Market Data Dump: Thursday - sector performance 6 2

 

Daily Market Data Dump: Thursday - volume 6 2

 

Daily Market Data Dump: Thursday - rates and spreads 6 2

 

Daily Market Data Dump: Thursday - currencies 6 2


INSTANT INSIGHT: U.S. Dollar, Japanese Equities Crashing & Fed Rate Hikes

Takeaway: The U.S. Dollar was down in the last two days of trading sending commodities up and Japanese equities down.

INSTANT INSIGHT: U.S. Dollar, Japanese Equities Crashing & Fed Rate Hikes - dollar crumbled

 

The simple summary of the last two days of trading goes like this:

 

Dollar Down = Reflation Up

 

It's that easy...

 

Here's additional analysis via Hedgeye CEO Keith McCullough in a note sent to subscribers earlier this morning:

 

"All it took was 2 down days for USD to ramp reflation, but this time to lower-highs for both the CRB Index (TAIL risk resistance = 192) and Oil – anything in the area code of consensus on jobs “probably” (her word) gives the Fed the greenlight they want on a rate hike (i.e. rate of change in labor market will still be slowing into that hike, which would be USD bullish from here)" 

 

INSTANT INSIGHT: U.S. Dollar, Japanese Equities Crashing & Fed Rate Hikes - rate hike cartoon 12.16.2015

 

Meanwhile, in Asia...

 

Yesterday it was China flash crashing. Today it's Japan getting smoked. Again, down Dollar is at play, this time wreaking havoc on Japanese equities. McCullough writes:

 

"No likey the Down Dollar, Up Yen move, eh? For your friends who think stocks can’t go down anymore, the Nikkei just lost another -2.3% overnight and -3.9% in 2-days, taking it right back into #crash mode at -21% since July. Into the jobs report, I say you book some gains on the short side of Japanese Equities, especially if USD Index holds this 94-95 level." 

 

 

Where does the U.S. Dollar go from here?

 

 

With future Fed rate hikes tethered to "improvements" in the labor market, all eyes are on tomorrow's Jobs Report. To be clear, barring some truly massive ramp in the non-farm payroll numbers, the trend in the jobs market will continue to fall off its February 2015 peak in rate of change terms.

 

Not that this matters to the linear, labor economists at the Fed. A headline beat would "probably" (Janet's own words) justify a rate hike in the coming months. And the simple summary goes like this:

 

Rate Hike => Dollar Up

More to be revealed


CHART OF THE DAY: What The Fed's December Rate Hike Did To High Yield Spreads

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

 

"... How about the credit cycle? Oh right – another true but unimportant factor for weekly chart-chasers to consider until it matters again… What happened to High Yield Spreads last time (i.e. the only time in modern history) that the Fed tightened into a slow-down?"

 

CHART OF THE DAY: What The Fed's December Rate Hike Did To High Yield Spreads  - 06.02.16 EL Chart


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Cartoon of the Day: Blind Faith

Cartoon of the Day: Blind Faith - Fed Hike cartoon 06.01.2016

 

The Yellen Fed seems oblivious to the idea that they are considering hiking rates into an economic slowdown. 


Capital Brief: Trump's Fundraising Shortfall... & Sanders Big Win In CA?

Takeaway: Trump Trailing - Badly; Not All That Glitters Is Gold; Libertarian Limelight

Capital Brief: Trump's Fundraising Shortfall... & Sanders Big Win In CA? - capital brief

 

Editor's Note: Below is a brief excerpt from Hedgeye Potomac Chief Political Strategist JT Taylor's Capital Brief sent to institutional clients each morning. For more information on how you can access our institutional research please email sales@hedgeye.com.

TRUMP TRAILING - BADLY

Capital Brief: Trump's Fundraising Shortfall... & Sanders Big Win In CA? - trump forward

 

Trump did not actively solicit donations during the primary election, but has softened his position after finding himself well behind on that front. The problem comes down to shortfalls in fundraising and boots on the ground - without one, you can’t have the other.

 

Republicans have only a fraction of the money they had 2008 and 2012, and less of an infrastructure than their counterparts. While he’s certainly learning on the fly, he’ll soon appreciate the fact that you can’t win a general election the same way you won the primary.

NOT ALL THAT GLITTERS IS GOLD

Capital Brief: Trump's Fundraising Shortfall... & Sanders Big Win In CA? - bern

 

Bernie Sanders continues to hold massive rallies in CA ahead of next Tuesday’s primary. If Sanders can pull off the win next week, it should be a huge momentum boost, but where does it carry him given that primary season will be over that day (with the exception of DC on June 13)?

 

A win for Sanders could only weaken Clinton, especially after she grabbed CA Governor Jerry Brown’s endorsement yesterday. The outcome is sure to be close, but when June 8th rolls around and Clinton is well over the delegate count, either the flame will be snuffed out of the Sanders campaign or his scorched earth tactics will continue all the way to the Democratic convention in late July. 

LIBERTARIAN LIMELIGHT 

The Libertarian party has recently drawn more attention this election due to voters seeking alternatives to likely presidential nominees Hillary Clinton and Donald Trump. Now with former NM Governor Gary Johnson locking up the Libertarian party’s presidential nomination along with former MA Governor Bill Weld as his running mate, expect the Libertarian duo to pull votes from presumptive Republican nominee Donald Trump.

 

Looks like a third party run may come back to bite Trump – and that doesn’t even include the potential entry of an Independent party candidate being recruited by conservatives - David French (yes, who?) is considering jumping into the fray.


McMonigle At OPEC Meeting: Why $50 Oil Is Likely Temporary

Hedgeye Potomac Research Group's Joe McMonigle is in Vienna, Austria where OPEC is set to meet tomorrow. He tells BNN why the mood is much lighter this time compared to Doha, why $50 oil is likely temporary and his expectations for OPEC's production talks.

 

Click image below to watch the full interview.

McMonigle At OPEC Meeting: Why $50 Oil Is Likely Temporary - z bnn


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