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ISM Employment: So Bullish You Have To Buy Stocks!

Takeaway: We're kidding.

ISM Employment: So Bullish You Have To Buy Stocks! - ism mfg 8 1

 

Today's ISM Employment number is back to contraction. That 49.4 reading? It marks the 7th month in the last 8 in which the Employment index has been sub-50. Meanwhile, the headline ISM Manufacturing reading of 52.6 also fell from the prior month. That's not going to end The Bull that remains The Long Bond. 

 

In other words, the #GrowthSlowing trend remains firmly intact.

 

Still bullish?


6 Charts: Begging For Bailouts Hits An All-Time High

6 Charts: Begging For Bailouts Hits An All-Time High - Bear crossing cartoon 09.29.2015 

 

Bailouts and central market planning galore.

 

That's the macro morning update today.

 

On Friday, Italy's oldest bank, Monte dei Paschi, announced it had found a "definitive solution" for solving its legacy of bad loans, which would raise €5 billion from private investors and sell €9.2 billion of bad debts. Shortly thereafter it was announced that Italy's third largest bank had failed EU stress tests. If the global economy and financial markets came under pressure, Monte dei Paschi's financial position would be wiped out.

 

European markets did not respond kindly to the news, with equity markets down between -0.4% and -1.2% today.

Italy

 

Germany

 

Meanwhile, in Asia...

 

Central-market planning isn't working out so well. Nevertheless, the begging for bailouts continues. Despite rumors that the BOJ could ultimately end up pursuing helicopter money, the Nikkei is up a whopping 0.4% overnight, bringing its year-to-date performance to -12.6%.

 

6 Charts: Begging For Bailouts Hits An All-Time High - nikkei 8 1

Over in China

 

The politburo is trying to manufacture a soft landing for its slowing economy but hasn't been able to prevent carnage in the Chinese stock market. The crash continues...

 

Commodities?

 

Oil is down -16% in the past month, as reflation continues to deflate. 

 

Bull Markets?

 

Gold, on the other hand, continues its rally as blind faith in central bankers continues to wane. That's long been our case for holding gold and it is gaining increasing credence among investors as money managers like DoubleLine Capital CEO Jeffrey Gundlach say "sell everything," buy gold.

 

 

The other bull market worth watching, which has also been our favorite Macro position for some time now, is Long Bonds (TLT). On that front, the year-to-date scorecard is as follows:

 

  • TLT: +16%

  • S&P 500: +6%

 

Bottom Line...

 

Central market planners have been doing their damndest to mask their country's underlying economic issues but when reality sets in the resulting carnage is often sharp and painful. 


Daily Market Data Dump: Monday

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, rates and bond spreads, key currency crosses, and commodities. 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: Monday - equity markets 8 1

 

Daily Market Data Dump: Monday - sector performance 8 1

 

Daily Market Data Dump: Monday - volume 8 1

 

Daily Market Data Dump: Monday - rates and spreads 8 1

 

Daily Market Data Dump: Monday - currencies 8 1

 

Daily Market Data Dump: Monday - commodities 8 1


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Still Crashing... Rolling The Dice In China's Shanghai Comp Casino

Takeaway: China's Shanghai Comp is down another -0.9% overnight after dropping -1.1% last week, taking its crash to -43% from its 2015 high.

I'm having a hard time seeing a “bottom” in any non-made-up time series. After falling another -1.1% last week, Shanghai Comp loses another -0.9% overnight (taking its crash to -43% since June 2015) as the Yuan continues to hit new lows.

 

 

Still Crashing... Rolling The Dice In China's Shanghai Comp Casino - China crash cartoon 08.25.2015 large 

 

Editor's Note: The snippet above is from a note Hedgeye CEO Keith McCullough wrote for subscribers this morning. Click here to learn more.


CHART OF THE DAY: Celebrate 1% GDP While It Lasts

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.

 

"... That’s right. Don’t be afraid of a 1.2% US GDP number ahead of the toughest 2-year comparison of #TheCycle for Real PCE Growth (Q3). Celebrate it, while it lasts! Consensus is now very long of both stocks and bonds on a clean cut #GrowthSlowing GDP TREND."

 

CHART OF THE DAY: Celebrate 1% GDP While It Lasts - 08.01.16 EL Chart


REPLAY! This Week On HedgeyeTV

Our deep bench of analysts take to HedgeyeTV every weekday to update subscribers on Hedgeye's high conviction stock ideas and evolving macro trends. Whether it's on The Macro ShowReal-Time Alerts Live or other exclusive live events, HedgeyeTV is always chock full of insight.

 

Below is a taste of the most recent week in HedgeyeTV. (Like what you see? Click here to subscribe for free to our YouTube channel.)

 

Enjoy!   

 

1. This Overlooked Housing Investigation Has Huge Investing Implications (7/29/2016)

 

 

In this excerpt from The Macro Show, Hedgeye Housing analyst Josh Steiner explains the findings of a recent Treasury Department investigation that has significant implications for housing investors. 

 

2. REPLAY | About Everything with Neil Howe: Earnings Smaller Than They Appear (7/28/2016)

 

 

In this complimentary edition of About Everything, Hedgeye Demography Sector Head Neil Howe discusses the growing use of "pro forma" accounting and explains the broader implications for investors.


Click here to read Howe’s associated About Everything piece.

 

Click here to access the associated About Everything slides.

 

3. Under 60 Seconds: 3 Takeaways From Hilton's Earnings Report (7/27/2016)

 

 

Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan shares three key conclusions from Hilton's earnings report and why it remains on the Best Ideas list as a short.

 

4. Why We’re Positive On Las Vegas Sands And Its Fat Dividend (7/27/2016)

 

 

In this brief excerpt from The Macro Show this morning, Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan explains why he likes Las Vegas Sands (LVS).

 

5. Under 60 Seconds: 3 Takeaways From Twitter's Earnings Report (7/27/16) 

 

 

Hedgeye Internet & Media analyst Hesham Shaaban shares three key conclusions from Twitter's worse-than-expected earnings report.

 

6. The Long-Term Twitter Story Isn’t Good (7/26/2016)

 

 

In this excerpt from The Macro Show, Hedgeye analyst Hesham Shaaban goes granular on the major headwinds facing Twitter. “Over the last two plus years, management has inflicted so much damage on its model that we really can’t see a way to fix it,” says Shaaban. “If Twitter can figure this out, there’s a ton of upside, given how badly the stock has been dinged throughout its public history. We just can’t see it—not yet at least.”

 

7. Lazard: Cheap On The Wrong Numbers (7/25/2016)

 

 

In this excerpt from The Macro Show earlier today, Hedgeye Financials analyst Jonathan Casteleyn reiterates his short call on Lazard ahead of its earnings report on Thursday.


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