CLIENT TALKING POINTS
China
Shanghai re-opens post new yearr and stocks close down -0.6% - bigger issue we’re focused on remains Chinese tightening in the face of trending USD strength – the PBOC raised rates on 7, 14, and 28 day repos last night.
UST 10YR
After the clean cut breakout we signaled in JGB yields, the BOJ had to intervene and calm the 10year down from +0.15% back to +0.09%; like US and German 10year yields, the TREND is bullish (and we remain bearish on sovereign long-term bonds); UST 10year Yield, vying for a 3rd straight up week ahead of jobs report.
VIX
What if this jobs report is a rate of change acceleration? NFP topped in Q1 of 2015 don’t forget. DEC was its slowest rate of change yet. While prevailing consensus remains that Trump = Volatility, markets have done nothing but smash volatility to new lows since the election. 30-day realized vol = 6.4! and front month VIX risk range = 10.15-12.82.
Asset Allocation
| CASH | US EQUITIES | INTL EQUITIES | COMMODITIES | FIXED INCOME | INTL CURRENCIES | |
|---|---|---|---|---|---|---|
| 2/2/17 | 22% | 22% | 18% | 12% | 0% | 26% |
| 2/3/17 | 22% | 22% | 18% | 12% | 0% | 26% |
Asset Allocation as a % of Max Preferred Exposure
| CASH | US EQUITIES | INTL EQUITIES | COMMODITIES | FIXED INCOME | INTL CURRENCIES | |
|---|---|---|---|---|---|---|
| 2/2/17 | 22% | 67% | 55% | 36% | 0% | 79% |
| 2/3/17 | 22% | 67% | 55% | 36% | 0% | 79% |
THREE FOR THE ROAD
TWEET OF THE DAY
Cartoon of the Day: Groundhog Day app.hedgeye.com/feed_items/570
@Hedgeye
QUOTE OF THE DAY
“I always thought records were there to be broken.”
–Michael Schumacher
STAT OF THE DAY
Julian Edelman has 98 receptions for 1,106 yards this season for the Patriots.
