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To help contextualize this morning's market moves around the world, below are insights and analysis from our research and Hedgeye CEO Keith McCullough's Twitter feed.
Boom! U.S. Economy 3% Growth
FACT: Only one firm has been calling for GDP accelerating to 3% in 2017. Today's 3Q17 GDP report came in at 3% (quarter-over-quarter seasonally adjusted annual rate). The year-over-year GDP print of 2.3% shows the trend (see chart below). The U.S. economy has accelerated from a low of 1.2% growth in 2Q16 to the 2.3% reported today. Over this period, the S&P 500 is up 26%.
https://twitter.com/Hedgeye/status/923901887908405248
https://twitter.com/KeithMcCullough/status/923892497528639491
Earnings: Up, Up & Away
The Nasdaq hit another all-time high today on U.S. growth accelerating. Tech happens to be one of the pockets of the U.S. equity market most tethered to an accelerating U.S. economy. That's why Nasdaq earnings are up 22.9% year-over-year. The index's performance is beating the Russell 2000, Dow and S&P 500 up +24% year-to-date.
https://twitter.com/KeithMcCullough/status/923849502070657024
Tech Bears Go Into Hibernation
More U.S. growth accelerating evidence? Shares of technology behemoths Amazon (AMZN) and Google (GOOGL) are up 10.5% and +6.8% respectively, all while bears complained about expensive valuations.
https://twitter.com/KeithMcCullough/status/923845783790776321
https://twitter.com/KeithMcCullough/status/923848955880005632
https://twitter.com/KeithMcCullough/status/923908807910150144
(Lack of) STOCK MARKET Volatility
The market has provided ample evidence in support of all-time highs in stocks this year. The VIX is down -24% year-to-date as equity market volatility continues to make lower highs.
https://twitter.com/KeithMcCullough/status/923847081806258176
Rates Up... Rate Hike?
The 10-year Tresaury is up 12 basis points in October alone. With inflation percolating and U.S. growth accelerating, it's becoming increasingly likely the Federal Reserve raises rates into year end.
https://twitter.com/KeithMcCullough/status/923855999429169153
You're gonna want to read this
On an unrelated note, Energy analyst Kevin Kaiser wrote the Early Look today and explained why "The MLP heyday is over, and good riddance to it."
https://twitter.com/Hedgeye/status/923891725118132229
A final note
This cartoon is self explanatory...
https://twitter.com/KeithMcCullough/status/923857653989871616
Want to better understand the big picture macro market developments? Get a free month of our newly launched weekly newsletter Market Edges.
