• HEDGEYE’S MARKET BRIEF
    Our FREE Investing Newsletter
    Get Exclusive Summer Sale Discounts

    By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails. All Hedgeye products and services are subject to Hedgeye’s Terms of Service available at www.hedgeye.com/terms_of_service

Client Talking Points

UK

Oh have the Brexit Bears (on the economy) been wrong – UK Services PMI for DEC accelerates (again) to 56.2 DEC vs. 55.2 NOV and the FTSE hits yet another post Brexit high; I still like the Pound on pullbacks to the low-end of my range 

Volume

My price/volume/volatility signal continues to signal buying opportunities on slowing volume DOWN days; the last 2 UP days for the SP500 have seen Total US Equity Market Volume +11% and +30%, respectively, vs. the 1-month avg.

10YR

One of the few remaining economic data series that has NOT accelerated is NFP – if that were to change tomorrow, I see Gold getting smoked and the 10yr getting to at least 2.61%; the y/y NFP “compare” for JAN is a lot easier than the comp for DEC, so we might have to wait another month; but the probability isn’t low that the jobs market stops slowing Q1/Q2.

 

TOP 4 LONGS: USD (or UUP in ETF terms), GBP/EUR, XOP, and QQQ

 

TOP 3 SHORTS: Gold (GLD), EUR/USD (FXE), Long-term Treasuries (TLT)

Asset Allocation

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
1/4/17 31% 21% 10% 11% 0% 27%
1/5/17 33% 18% 10% 11% 0% 28%

Asset Allocation as a % of Max Preferred Exposure

CASH US EQUITIES INTL EQUITIES COMMODITIES FIXED INCOME INTL CURRENCIES
1/4/17 31% 64% 30% 33% 0% 82%
1/5/17 33% 55% 30% 33% 0% 85%
The maximum preferred exposure for cash is 100%. The maximum preferred exposure for each of the other assets classes is 33%.

Three for the Road

TWEET OF THE DAY

Kohl's ($KSS) putting up $4 in EPS is kind of like bigfoot. People talk about it all the time, but nobody ever sees it.

@HedgeyeRetail

QUOTE OF THE DAY

"I want to stay as close to the edge as I can without going over. Out on the edge you see all kinds of things you can't see from the center. Big, undreamed-of things – the people on the edge see them first."

–Kurt Vonnegut

STAT OF THE DAY

Active equity funds closed out 2016 with cumulative annual fund flows at new all-time lows. Domestic equity lost -$237.5 billion in 2016, outstripping 2015's -$174.3 billion outflow to become the worst year on record.