The failures of Silvergate Bank, Silicon Valley Bank, Signature Bank, and the current struggles of First Republic and Pacific West Bank have seen bank deposits flee to the perceived safety of large banks.
The Federal Reserve’s balance sheet grew by $394B in the past two weeks.
Yields on 10-Year Japanese Government Bonds have fallen by about a third over the past two weeks, as shown in the chart below.
To shore up Silicon Valley Bank and the other failed banks, the Federal Reserve extended an open-ended line of credit via its Bank Term Funding Program (BTFP) and discount window borrowings.
Credit Suisse’s problems revealed today stem from issues the company discussed last June in a profit warning.
Headline CPI came in today as expected at 0.4%, however core inflation (ex food and energy) came in slightly higher at 0.5% versus the estimated 0.4% increase.
We just experienced the fastest bank run in history with the closure of Silicon Valley Bank.
For decades since the end of the Cold War there have been very limited restrictions on foreign investments by US investors compared to those of other countries.
North American developed market large-mid stocks (United States and Canada) bottomed simultaneously with other developed markets on 10/12/22, recovering over 10% since then.
Investor concerns over the potential for poor European growth in the foreseeable future have eased thanks to the flurry of economic data coming out stronger than expected this year.
The Japanese Government Bond 10-year breakeven inflation has run contra to recent worldwide trends as one of the few sovereign rates of its kind to decline year to date.
The common narrative is that we’ve (the US) been enjoying a long period of globalization and now that it is going into reverse, it will upend many of the benefits brought by globalization, to the US in particular.
Last week, I dissected developed markets EMEA (DM EMEA) stock performance by sector and found that the consumer discretionary sector was driving upward performance.
Last week I looked at how Canadian stocks underperformed US stocks this year, decomposing North American Performance.
As inflation fears have receded somewhat—though we’ll see in next week’s US CPI report how much they really have receded—European stocks have had a good start to the year.
With Caixin China PMI numbers today broadly confirming Monday’s official CCP data, the outlook for China and its neighbors remains bright.
On Monday, Germany’s GDP print for the final quarter of 2022 came out below expectations of 0.0% by -2%.
In anticipation of tomorrow’s rate decision, we saw another indicator today that the Federal Reserve has been successful in stemming the tide of inflation.
The Atlanta Fed Flexible CPI is a price series developed by the Atlanta Fed to capture the price of items that change the most frequently.
Yesterday, we got our first look at December’s economic data for Europe, in the form of PMIs.
The US Purchasing Managers Composite Index (PMI) increased in January to 46.6 from 45 in December, representing a slowing economy but slightly less pessimistic than expected and better than the month before.
We got consumer price reports for many European countries this week.
Overnight, traders pressed the Bank of Japan again on its Yield Curve Control (YCC).
With winter not fully upon us, European industrial production has benefitted from lower energy prices.
In our Quarterly Strategy Report, we illustrate the relative attractiveness of select developed international sectors.
In a recent San Francisco Federal Reserve Publication titled “Monetary Policy Stance is Tighter Than Fed Funds Rate,” the authors argue that the “all in” policy rate is actually higher than the Fed Funds rate would suggest.
While many seemed to focus on the basics of the employment report like average hourly earnings (which don’t take into consideration industry mix shifts among the employed) and the payroll job beat for the month, there is one very important variable that revealed the weakness in last month’s jobs report.
There are many ways to decompose the bond market to identify the component pieces to infer what the market is pricing in.
We believe highly innovative companies, when accounted for properly, are cheaper than their non-innovative peers in all regions of the world.
The Federal Reserve has been raising rates at an extremely aggressive manner in 2022, taking the federal funds rate from 25bps to 4%.
In recent reports, we’ve been highlighting that innovation—as a factor represented by R&D as % of sales—has stopped underperforming and it is selling for an attractive valuation.
While many perceive the S&P 500 Index to be a broad innovation-heavy index, in a way it is and in a way it isn’t.
A couple of weeks ago, in our quarterly strategy report, I argued that it appeared that innovation had bottomed.
Digging in a little deeper, we sifted through this first quintile of the S&P 500 for other insights.
A couple weeks ago, in our quarterly strategy report (see: QSR-Has Innovation Bottomed?), I argued that it appeared that innovation had bottomed.
Irvine, California-based Masimo makes non-invasive patient monitoring, measuring and sensing technologies that improve patient care in the hospital, the home, and on the go.
Last night, the Reserve Bank of Australia stopped short of another 50bps hike to its overnight cash rate.
It appears to us that global innovation has bottomed and offers attractive value.
Innovation was the market darling thematic for many years leading up to COVID.
Using our proprietary point-and-figure-based charting system, I review a couple thousand charts per week in an attempt to identify interesting buy or sale candidates.
Shopify is a leader in commerce solutions that allow merchants to set up online stores and sell their products.
Last week, the combined dollar value of hedge positions on the S&P 500, NASDAQ 100 and Dow Jones Industrial indexes was $121.43 billion, not far from the August 16 peak of $160.02 billion.
The most significant element going into the June low was positioning.
This the name of a recent research piece from the San Francisco Federal Reserve written by Adam Shapiro.
Given all the confusion in the world around COVID, supply chains, inflation dynamics and war, there are lots of potential externalities that could resolve themselves unexpectedly.
Pinterest is a virtual bulletin board for finding and sharing ideas for food, home, style, inspiration, and more.
Over the weekend, we got a slew of data showing a generally weak economy.
Take-Two Interactive Software makes games for consoles, computers, and phones
Across US indexes, growth has experienced a resurgence relative to value off the June 17, 2022 low.