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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.
All-Time Highs: Sector Divergences
The S&P 500, Dow and Russell hit all-time highs yesterday. The S&P 500 sector breakdown is getting interesting. "With Oil ripping, we have both Reflation (XLE) and Tech (XLK) working as of late vs. levered, slow-growth, like Consumer Staples (XLP) which continues to lag (XLP down another -1.1% yesterday to only +1.7% YTD)," writes CEO Keith McCullough.
https://twitter.com/KeithMcCullough/status/927853318499643392
Leading the winners and our favorite sector, Tech stocks are up 31.6% year-to-date as the U.S. economy has continued to heat up.
https://twitter.com/KeithMcCullough/status/927854362692636672
Meanwhile, in Europe...
Are you betting on Europe? Wall Street is. You shouldn't be. The Eurozone economy just hit a 7-year high and we see notable catalysts ahead for our #EuropeSlowing call. The cracks are beginning to show...
https://twitter.com/KeithMcCullough/status/927856042142326784
... The Euro is breaking down.
https://twitter.com/KeithMcCullough/status/927857183320170496
... and Spanish stocks are leading Europe's losers this morning, down -7% from their May highs.
https://twitter.com/KeithMcCullough/status/927860132679159809
Another European equity market we don't like is Italy. We see an inflection point in the slowing Italian economy over the next three quarters and these woes will be compounded by the drag of awful demographics.
https://twitter.com/KeithMcCullough/status/927862042484183041
In Asia...
Japan's Nikkei is up a whopping 17% year-to-date.
https://twitter.com/KeithMcCullough/status/927857963699752960
https://twitter.com/KeithMcCullough/status/927858481553690624
Before you go...
"If Tesla even survives to profitability, it would be an exceptional accomplishment," Industrials analyst Jay Van Sciver wrote back in June. Since then, Tesla shares are down -19%.
https://twitter.com/KeithMcCullough/status/927863911797395458
Want to better understand the big picture macro market developments? Get a free month of our newly-launched weekly newsletter Market Edges.
