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Daily Market Data Dump: Tuesday

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

 

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Daily Market Data Dump: Tuesday - equity markets 8 23

 

Daily Market Data Dump: Tuesday - sector performance 8 23

 

Daily Market Data Dump: Tuesday - volume 8 23

 

Daily Market Data Dump: Tuesday - rates and spreads 8 23

 

Daily Market Data Dump: Tuesday - currencies 8 23

 

Daily Market Data Dump: Tuesday - commodities 8 23


August 23, 2016

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  • Bullish Trend
  • Bearish Trend
  • Neutral

INDEX BUY TRADE SELL TRADE PREV. CLOSE
UST10Y
10-Year U.S. Treasury Yield
1.60 1.48 1.55
SPX
S&P 500
2,165 2,192 2,182
RUT
Russell 2000
1,216 1,245 1,239
COMPQ
NASDAQ Composite
5,157 5,263 5,244
NIKK
Nikkei 225 Index
16,316 16,795 16,598
DAX
German DAX Composite
10,380 10,800 10,494
VIX
Volatility Index
11.09 14.49 12.27
USD
U.S. Dollar Index
93.92 96.25 94.50
EURUSD
Euro
1.10 1.13 1.13
USDJPY
Japanese Yen
99.20 102.35 100.32
WTIC
Light Crude Oil Spot Price
41.11 49.80 47.41
NATGAS
Natural Gas Spot Price
2.50 2.75 2.70
GOLD
Gold Spot Price
1,329 1,365 1,343
COPPER
Copper Spot Price
2.12 2.18 2.15
AAPL
Apple Inc.
107.01 109.98 108.51
AMZN
Amazon.com Inc.
750 780 759
NFLX
Netflix Inc.
92.93 97.24 95.26
JPM
J.P. Morgan Chase & Co.
63.07 66.25 65.80
INTC
Intel Corp.
34.12 35.95 35.36
P
Pandora Media Inc.
13.01 13.91 13.68
XOP
SPDR S&P Oil & Gas Explore
34.53 37.95 36.88
RMZ
MSCI US REIT
1,216 1,255 1,226

Hedgeye's Daily Trading Ranges are twenty immediate-term (TRADE) buy and sell levels, along with our intermediate-term (TREND) view.  Click HERE for a video from Hedgeye CEO Keith McCullough on how to use these risk ranges.


This Country Makes Our Global Equity Long List

Takeaway: A new addition to our (very short) list of countries added to the Global Equity long side: Taiwan.

Yep. Long Taiwan (TAIEX Index or EWT). We added that to our Global Equity LONG list while I was away last week. Standard Hedgeye GIP Model process reasoning as Taiwan moves into what we call Quad 1 (or 2) in the back half of 2016. Not many countries are…

 

Here's the brief breakdown of Taiwan, as it looks in our GIP (Growth, Inflation, Policy) model via Senior Macro analyst Darius Dale: 

 

  • Growth: generally trending higher across the preponderance of key high-frequency data
  • Inflation: generally trending higher across the preponderance of key high-frequency data
  • Policy: getting easier at the margins

 

 

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


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479 of 500 S&P Companies have reported an aggregate (non-GAAP) EPS decline for Q2 of -3.7% y/y…

Client Talking Points

UST 10YR

Oh the fun and games the “next frontier” of central planning must be to muse about… yesterday’s smack-down (in yields) came on rumors Janet is going to move the goal posts on her “inflation target” to 4% AFTER Fischer said we’re good to go at 2%, lol.

Oil

Talk about a smack-down; Oil down over 3% yesterday and not showing any green yet this am (sub $47) with an immediate-term TRADE risk range of $41.11-49.80; big problem here is that Oil’s Volatility (OVX) won’t break-down through 30 #WickedChop.

Taiwan

Yep. Long Taiwan (TAIEX Index or EWT). We added that to our Global Equity LONG list while I was away last week. Standard Hedgeye GIP Model process reasoning as Taiwan moves into what we call Quad 1 (or 2) in the back half of 2016. Not many countries are…

Asset Allocation

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
8/22/16 51% 3% 3% 11% 19% 13%
8/23/16 49% 4% 6% 12% 17% 12%

Asset Allocation as a % of Max Preferred Exposure

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
8/22/16 51% 9% 9% 33% 58% 39%
8/23/16 49% 12% 18% 36% 52% 36%
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
GLD

See update on TLT below.

TLT

#Stagnation. With that being said there were small but marginal Euro tailwinds against a U.S. retail sales report and PPI release that was likely dovish on the margin (USD -~20bps on Friday and -~60bps on the week). 

 

In line with our #EuropeSlowing theme, Q2 preliminary GDP slowed across the Eurozone to +0.3% vs. +0.6% in the prior quarter and +1.6% Y/Y for Q2 which was flat on a rate of change basis from Q1.

Looking at specific country results:

  • German (0.4% vs 0.7% sequentially) GDP accelerated to +1.8% Y/Y from +1.6% which was probably a minor Euro FX tailwind
  • Italian GDP came in at +0.7% Y/Y which was a deceleration from +1.0% in Q1
  • Greece GDP accelerated to contraction again, printing a measly -0.1% Y/Y from -1.3% in Q1

The Southern Eurozone states continue to implode.

UUP

Recall that a strong retail sales report for June, driven by a positive trend in goods consumption, was a large contributor to our GDP revision for Q2. The headline number, for June, was up +0.6% sequentially with the sequential acceleration in the control group accelerating +7.2% (annualized). #Deflation  

Three for the Road

TWEET OF THE DAY

How Slowing Chinese #Housing Demand Is Affecting Global #RealEstate Mkts app.hedgeye.com/insights/53258… @KeithMcCullough pic.twitter.com/Jm5XyxyKfR

@Hedgeye

QUOTE OF THE DAY

“Strength and growth come only through continuous effort and struggle.”

-Napoleon Hill

STAT OF THE DAY

Cam Newton has 160 career TD's in the NFL.


CHART OF THE DAY: U.S. Productivity At Generational Lows? Yup

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.

 

"... The productivity point is one that one of the world’s largest asset managers made to us in recent meetings in California. The PM asked whether all this “Fed Watching” was distracting companies from investing in real things as opposed to the next frontier of rumors…

 

Even if you go Ex-Energy, Ex-GAAP-Earnings, Ex-GDP with your narrative that everything ZIRP, NIRP, TWIRP is good, you’ll still have a very hard time convincing a rational human being who isn’t bought and paid for by the system that US Productivity at generational lows is…"

 

CHART OF THE DAY: U.S. Productivity At Generational Lows? Yup - 08.23.16 chart


Study Risk Or Rumors?

“My life has been the study of risk.”

-Benoit Mandelbrot

 

God bless Benoit Mandelbrot’s soul. He died in 2010 at the age of 85. If you haven’t seen his last TED talk, I highly recommend it alongside one of my favorite risk management books, The (Mis)Behavior of Markets. That’s where the aforementioned quote comes from.

 

“As a scientist, all of my research has, in one way or another, veered between the two poles of human experience: deterministic systems or order and planning, and stochastic, or random, systems of irregularity and unpredictability.” (page 5)

 

Read that a few more times and think about it in the context of trying to understand macro markets. There is a community of people in the establishment who simply opine on how to order and centrally plan economic gravity; then there’s us – the humble servants of the market Gods who have come to realize, through losses and learning opportunities, that dynamic systems are non-linear and irregular.

 

Back to the Global Macro Grind

 

What do you spend more time on, deliberately studying markets and their risks… or chasing and/or reacting to rumors? In the short term, those aren’t mutually exclusive options. Since just about any central-market-planning voice can move markets, there’s risk in that too.

 

Study Risk Or Rumors? - Fed cartoon 08.22.2016

 

Yesterday’s “rumor” du jour came from a popular Federal Reserve voice by the name of Zervos. Not to be confused with a Greek god or the French writer, this Ph.D. is of the Old Wall banking system. As far as former Fed guys go, he’s quite creative in his macro musings.

 

He was floating the idea that Janet Yellen might take a flyer on her San Francisco Fed colleague John Williams’ idea to raise the Federal Reserve’s inflation target to 4%. Since Yellen speaks at Jackson Hole on Friday, this interrupted all of Old Wall Media’s headlines that Fed Vice Overlord Fischer was saying “we’re close to our targets”.

 

Rates Down (yesterday), Yield Chase Up on that…

 

So yes, in the short-term, rumorings and musings matter to markets; especially in the week of “the connected” @JacksonHole. Ever since Ben Bernanke used this central planning podium to move markets in the summer of 2010, we’ve had to deal with this market irregularity.

 

But, once you move beyond the short-term brokering of such rumors (there’s good money and a nice travel lifestyle in that)…  and you move into the intermediate and long-term, what do irregular policy actions (trying to bend and/or smooth gravity) deliver, economically?

 

  1. They certainly haven’t delivered sustainable, above TREND, real economic growth
  2. They’ve widened the divide between us and them, in real purchasing power terms
  3. They’ve crushed productivity, as we all live in perpetual fear of, god forbid, short selling… on fundamentals

 

The productivity point is one that one of the world’s largest asset managers made to us in recent meetings in California. The PM asked whether all this “Fed Watching” was distracting companies from investing in real things as opposed to the next frontier of rumors…

 

Even if you go Ex-Energy, Ex-GAAP-Earnings, Ex-GDP with your narrative that everything ZIRP, NIRP, TWIRP is good, you’ll still have a very hard time convincing a rational human being who isn’t bought and paid for by the system that US Productivity at generational lows is…

 

So getting back to work this morning, measuring and mapping real things (even if they’re really being distorted by rumors!) like the PRICE, VOLUME, and VOLATILITY of asset prices… maybe we should all just go back to day-trading Oil futures. Isn’t this productive?

 

  1. After failing @Hedgeye TAIL risk resistance of $52.11, WTI had its biggest down day in 3 weeks yesterday
  2. At $47/barrel, that puts Oil (WTI) at +2.9% in the last week but -1.5% in the last 3 months
  3. Oil Volatility (OVX), meanwhile, has oscillated between 35 and 45 for 3 months with some #WickedChop

 

Not to be confused with the perception of intellect required to bend/smooth economic gravity via moving goal post “targets” (i.e. Wicked Smaht), ironically it’s the wicked chop itself that is not only killing the banks/brokers who employ Fed people, but their active clients.

 

Total US Equity Market Volume (including dark pool) was down -18% yesterday vs. its 1yr average. On Friday, it was down -24%. Yeah, if you go Ex-Summer, it was due to it being the summer (year-over-year). But isn’t this really more about studying risks than rumors?

 

The risk of every centrally planned market bubble is that everyone is afraid to sell it. That’s right – at the very top, even the bears are reluctantly net long of it. Then boom! Something stochastic, random, and “unpredictable” happens.

 

Then we see the losses. Then they have another learning opportunity to realize some humility.

 

Our immediate-term Global Macro Risk Ranges are now (with intermediate-term TREND research view in brackets):

 

UST 10yr Yield 1.48-1.60% (bearish)

SPX 2165-2192 (bullish)
RUT 1 (neutral)

NASDAQ 5157-5263 (bullish)

XOP 34.53-37.95 (neutral)

RMZ 1 (bullish)

Nikkei 165 (bearish)

DAX 100 (bearish)

VIX 11.09-14.49 (bullish)
USD 93.92-96.25 (bullish)
EUR/USD 1.10--1.13 (bearish)
YEN 99.20-102.35 (bullish)
Oil (WTI) 41.11-49.80 (bearish)

Nat Gas 2.50-2.75 (neutral)

Gold 1 (bullish)
Copper 2.12-2.18 (bearish)

 

Best of luck out there today,

KM

 

Keith R. McCullough
Chief Executive Officer

 

Study Risk Or Rumors? - 08.23.16 chart


Daily Trading Ranges

20 Proprietary Risk Ranges

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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