VIX and SPX up yesterday (vols got dragged far too low - but interesting nonetheless)
China’s central bank cut its seven-day reverse repurchase rate by 10 basis points from 2% to 1.9%, first reduction in nearly 1year >>> USDCNH 7.16
BoE's Catherine Mann remains "very concerned" about persistent UK inflation pressures, she drew particular attention to high wages for new hires, "sticky" core CPI, and uncomfortable price gains in the services industry
Luxury goods: Europe’s joke on the world-The old continent profits from the cultural insecurities of other regions/FT article
UK two-year yield rises to its highest since 2008 on jobs data (surpassing the Trussonomics levels) as UK private sector wage growth accelerates to 7.6% >>> could argue 50bps next week!
US regulators move to block Microsoft's Activision takeover
Trump's "peril is extreme": Former federal prosecutor on the historic Mar-a-Lago indictment and Privileges Committee finds Boris Johnson deliberately misled Parliament – report
To put things into perspective: 10 stocks have contributed 90% of S&P 500's 13.0% gain this year, the most concentrated mkt ever, Bernstein says - EVERCORE: “A mountain of money” in money market accounts is “fuel for an equity momentum market move” — and could “accelerate the arrival of our year end S&P 500 Price Target of 4,450 to as early as July 4 ..”
"Total debt as a share of GDP hit 295% in China last September, surpassing 257% in the U.S. and an average of 258% in the eurozone."
The US government continues to spend money like a drunken sailor w/ the budget deficit widening to $2.1 trillion, highest since Feb 2021. This is occurring when the economy is still in an economic expansion w/ Unemployment @ 3.7%. What happens to the deficit when recession hits?
Markets :
FANG's up 70% YTD, must be a lot of chasing, FOMO style buying going on lately..NIKKEI back to 1990 highs, that's going back some!
USDollar slightly softer ahead of all the CB events, with CROSSJPY's higher overall on higher risk and yields, imho we go 25bps for FOMC; ECB and SNB, BoJ should also move, and BoE next week could very well go 50bps, all of which is fairly well priced so language will be key, as usual, path forward is key
Brent hit 2023 lows, WTU $67 good for consumers!
Biggest standout in fund manager positioning is the overweight to bonds and underweight to equities... see Thread below
The year so far in the noisy medias.. (no names!) :
January: soft landing!
February: no landing!
March: hard landing!
April: credit crunch surely?
May: it’s just mega cap tech
June: it’s a bull market!!!!
Barchart on Twitter: "JP Morgan's prediction for how the S&P 500 will react to this week's CPI reading. Warning: JP Morgan tends to get these almost always wrong https://t.co/zNp7TBnfYr" / Twitter - irrelevant whether you or I agree with it or not.. many in markets, algos will follow this path...
Luxury goods: Europe’s joke on the world | Financial Times (ft.com) >>> full on masterpiece of a column
Has China’s power peaked? - GZERO Media china faces the worst demographic trajectory of any country we’ve ever seen in peacetime >>> population now about 1.4b
, and so it seems...est population in 2100 : 475-700m (!)
Thanks BoJo and Co.. Brexit cited as a major concern as US business confidence in Britain drops (cityam.com)
Swiss inflation rate falls to lowest level since start of Ukraine war - SWI swissinfo.ch >>> CREDIT SUISSE: “Our work indicates that YoY inflation is likely to fall to 4.2% in May, 3.2% in June .. this would represent one of the greatest drops experienced in a 2-month period over the past 70 years.”
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