• IT’S A NEW YEAR
    GET NEW INVESTING IDEAS
    subscribe today for $9.95
    Limited time offer
prev

Cartoon of the Day: Short Earth?

Cartoon of the Day: Short Earth? - Intelligent life cartoon

 

A gloomy mood is engulfing the globe.


Don't Believe the June Jobs Report Hype

Takeaway: Employment growth continued to slow from its 2.3% y-o-y peak in February 2015 to 1.73% in June.

For those of you out there who actually study #TheCycle (rather than blindly accept the manic financial media's headlines at face value) here's the key chart to consider. It shows the continued slowdown in jobs growth since February 2015.

 

Click images to enlarge

Don't Believe the June Jobs Report Hype - nfp 7 8

 

Digging a little deeper than just the headline 287,000 number... May was revised down from 38,000 to 11,000. As Hedgeye CEO Keith McCullough points out, in other words...

 

 

Here's the detailed breakdown to study today. As you can see, the key takeaway is...

#EmploymentSlowing

 

Don't Believe the June Jobs Report Hype - employment summary 7 8


McCullough: Here’s Who’s Really Getting Paid

In this excerpt from The Macro Show today, Hedgeye CEO Keith McCullough discusses who’s really getting paid in the current  market and economic setup. 


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 80.35%
  • SHORT SIGNALS 78.44%

An Animated History Of U.S. #GrowthSlowing (In Just One Minute)

Takeaway: If you don't do macro, macro will do you.

During his presentation of our top Q3 macro themes to our institutional customers yesterday, Hedgeye CEO Keith McCullough empasized the importance of understanding the cycle. The one-minute video below sheds addiitional light on this economic reality.

 

Click below to watch.


Daily Market Data Dump: Friday

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

 

CLICK TO ENLARGE

 

Daily Market Data Dump: Friday - equity markets 7 8

 

Daily Market Data Dump: Friday - sector performance 7 8

 

Daily Market Data Dump: Friday - volume 7 8

 

Daily Market Data Dump: Friday - rates and spreads 7 8

 

Daily Market Data Dump: Friday - currencies 7 8


Bad jobs report should get you 1.30% UST 10yr; “good” one maybe 1.57% 10yr (1.30-1.57 risk range)

Client Talking Points

Japan

If you’re still looking for clues on how this grand-central-market-planning-experiment ends, it’s Yen Up, and Nikkei down for the 4th day in a row, -1.1% overnight, taking its crash in the #BeliefSystem to -27.7% since this time last year.

Commodities

What if the jobs print is “good” (albeit slowing in TRENDING rate of change terms)? Dollar Up, Commodity Reflation Down? With CRB Index and Oil -5% and -10%, respectively, in the last month I’m sure glad I didn’t chase those April-May reflation charts. To be continued… 

VIX

This 13-15 range for front-month US Beta Chasing Vol (VIX) has been a bear of a spot to be beta-shifting to levered long, so we’ll see what happens on the news this morning, but no matter what it is … I’ve been a seller of all beta chases for a year now in this VIX range and have no reason to change that Fading Beta strategy.

Asset Allocation

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
7/7/16 58% 0% 0% 10% 27% 5%
7/8/16 58% 0% 0% 10% 27% 5%

Asset Allocation as a % of Max Preferred Exposure

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
7/7/16 58% 0% 0% 30% 82% 15%
7/8/16 58% 0% 0% 30% 82% 15%
The maximum preferred exposure for cash is 100%. The maximum preferred exposure for each of the other assets classes is 33%.

Top Long Ideas

Company Ticker Sector Duration
TLT

Since equity markets peaked last summer, TLT has been a resilient and less volatile source of absolute alpha, and the good news is that spotting the opportunity requires a daily data grind and a wrestling with reality more than a sky-high IQ:

  • S&P 500: +0.1% Y/Y
  • TLT: +22.0% Y/Y

Brexit, Frexit, Yuan devaluation – whatever the story, investors are paying higher premiums for the safety and appreciation potential of the long bond, a source of long-standing outperformance in this #GrowthSlowing environment. Moving into 2015, net futures and options positioning shows that traders had the largest net short position in the 10-year Treasury of the entire cycle, as most were positioned for rate hikes and a “lift-off economy."

GLD

It was another week of all-time lows in long-term Treasury yields and YTD highs in Gold (GLD), Treasury Inflation-Protected Securities (TIP), and Long Bonds (TLT is at a new all-time high!) as the rotation out of volatile equity markets continues. 

TIP

See above update on TLT/GLD.

Three for the Road

TWEET OF THE DAY

No matter what the jobs report tells consensus, Hedgeye says short more Financials $XLF

@KeithMcCullough

QUOTE OF THE DAY

“We must take sides. Neutrality helps the oppressor, never the victim. Silence encourages the tormentor, never the tormented.”  

-Elie Wiesel 

STAT OF THE DAY

Nolar Ryan pitched 27 years in the MLB, his career ERA was 3.19


Early Look

daily macro intelligence

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.

next