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Writer's pictureStéphan
Dec 27, 20234 min read

2y UST 2y yields back to Jan lev / Fed pivot lifted Crude, Iron Ore, energy / SPR / Abe's BPI levels



  • The United States has finalized contracts to purchase three million barrels of oil to help replenish the Strategic Petroleum Reserve (SPR) after the largest sale in history last year, the U.S. Department of Energy said on Tuesday

  • GS : "We now see below-2% core PCE inflation as a plausible outcome for 2024.", “.. For the Fed, we believe below-target core inflation would lead the Committee to consider consecutive 25bp cuts at every FOMC meeting until the funds rate approaches their estimate of neutral at that time ..”

  • BMO: Powell “couldn't have asked for a better present .. consumers are spending, the economy is rolling along creating jobs and lifting incomes, and yet inflation is simmering down nicely. .. the endgame is turning out better than the Fed or nearly anyone could have imagined ..”

  • FT-Israel warns of regional conflict risk as Iran tensions increase (crude..)

  • Maersk resumed Red Sea shipping under U.S-led naval coalition

  • AI systems can't be named as the inventor of patents, UK's top court rules, Nvidia CEO Jensen Huang says AI will be ‘fairly competitive’ with humans in 5 years

  • The Bullish Percent Index (BPI), developed by Abe Cohen in the 1950s is a breadth indicator based on the number of stocks based on Point and Figure Buy signals. The indicator helps you know the market's health and when it's overbought or oversold >>>In 2022 and 2023, the indicator reached 70 (overbought) six times, all occurrences were near market peaks, and the indicator is again at/over 70 today

  • Global banks cut 60'000 jobs in 2023, led by CS/UBS, Citi and Wells

  • SPX500 has drawn around $40 billion in inflows in December, on track for the biggest monthly haul since it began trading in 1993

  • Confiscating Russian assets would be ‘cataclysm’ for dollar – Shiller

 

Markets :

  • The real question for markets in 2024, is whether the Fed Dec 2023 pivot will not trigger a new 'run-up' in inflation, and thus whether those 160bps of rate cuts priced in now for next year, need to be at least partly adjusted..

  • IronOre hitting $140 a ton, highest in 18months, #URA uranium prices hitting 10+ year highs, Crude WTI mid 70's range again, didn't stay long below $70, Red Sea situation keeping markets on edge >> the FED pivot bottom ticked the energy complex!

  • The small-cap Russell 2,000 has finally cleared the top of the sideways range it had been in since mid-2022

  • Equity markets grinding higher, Asia off their preXmas lows too (after the China announcement on gaming - but it has been a terrible year for SHCOMP and HSI), most staying bullish because the S&P500 has not declined during a re-election year since 1952 and has averaged about 10% gains in those years (inflation, rates the key, it is all that matters). SMI really underperformed this year, CHF strength.

  • UST 2year yields finishing slightly below levels where they were at the end of December 2023! those 4.8%+ yields earlier this year and again in Sep were a gift

  • USDollar weaker into year-end, if the bond market is right for 2024, the $$ should have a pretty bad year overall, FX not really being on the markets mind on a relative basis, bonds, equity, metals, crypto all moved much more than FX in 2023

  • GOLD ...''will not go (much) below $2K ever again!'', from a cost of production perspective XPT looks even better/cheaper, as for XAG mning, which has been in decline (Mexico), you'd think it has a real good chance to have a decent rally too
















Rigged Game - Inside Paradeplatz >> The fact that this did not happen and that Switzerland instead wrote off the AT-1s without replacement – and thus brought in powerful plaintiffs – and did not convert the bail-in bonds was due to foreign pressure





they look great!




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