CLIENT TALKING POINTS
ITALY
Obviously (now) this Renzi referendum was being priced into both Italian stocks and the Euro currency (both remain bearish TREND @Hedgeye), but the move in bond yields wasn’t. Italian 10yr +11bps this am to +2.01% with plenty of upside.
Oil
Big move last week (+12.5% w/w) with a follow through move of another +1.2% > $52 this morning; with Oil’s Volatility having dropped from 55 to 35, an Oil breakout from here would be very bullish for Oil as it’s failed here multiple times in 2016; Brent and WTI now have moderately POSITIVE correlations to USD on 15-90 day durations.
Nasdaq
Post last week’s -2.7% correction, we like it long side here. Don’t forget the Nasdaq is only up +2.2% vs. this time last year, so this isn’t a train everyone has “missed.” The US economy is currently tracking in what we call Quad2 (both growth and inflation accelerating); that’s where you buy Tech, Biotech, etc… and sell long-term bonds.
Asset Allocation
| CASH | US EQUITIES | INTL EQUITIES | COMMODITIES | FIXED INCOME | INTL CURRENCIES | |
|---|---|---|---|---|---|---|
| 12/4/16 | 53% | 16% | 6% | 2% | 3% | 20% |
| 12/5/16 | 48% | 18% | 7% | 3% | 3% | 21% |
Asset Allocation as a % of Max Preferred Exposure
| CASH | US EQUITIES | INTL EQUITIES | COMMODITIES | FIXED INCOME | INTL CURRENCIES | |
|---|---|---|---|---|---|---|
| 12/4/16 | 53% | 48% | 18% | 6% | 9% | 61% |
| 12/5/16 | 48% | 55% | 21% | 9% | 9% | 64% |
THREE FOR THE ROAD
TWEET OF THE DAY
8 Videos: What's On HedgeyeTV -China’s $24 Tril Problem -The ‘Graying of America’ Is Not Helping U.S. Gaming Stocks app.hedgeye.com/archives/55717
@Hedgeye
QUOTE OF THE DAY
“An investment in knowledge pays the best interest.”
–Benjamin Franklin
STAT OF THE DAY
Julio Jones leads NFL WR's in yards with 1,253.