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Writer's pictureStéphan

U.S debt : $34 Trn / FTSE100 is 40 today / Q4 FOMO and Jan reversal risk / FOMC minutes later on today




  • The TFSE 100 turns 40 today, there was the FT 30 and the Stock exchange 100.. >>> after the huge rally since early Nov 2023, watch the QQQ possible reversal, bonds leading the charge (and USD long stretched..)

  • Fed's Barkin is the 1st speaker in 2024 and FOMC minutes to focus on tonight

  • BBG-"China injected nearly $50 billion worth of low-cost funds into policy-oriented banks last month, suggesting the central bank may be ramping up financing for housing and infrastructure projects to support the economy."

  • Europe’s top securities regulator warns on risks from leveraged trades. Esma’s Verena Ross says efforts to monitor and curb bets that use borrowed money need to go further

  • US reaches deal to extend military presence at Qatar base

  • The Incredibly Ballooning US Govt Debt Spikes by $1trn in about 3months to $34trn, or $12 trn higher than 5years ago...Interest payments threatening to eat up 50% of tax receipts...Congress ?

  • "The fourth quarter has seen factories reduce employment at a pace not seen since 2009 barring only the early pandemic lockdown months" - PMI/US

  • US was top LNG exporter in 2023 as hit record levels

 

Markets :

  • FX positioning : as bonds and risk rallied (QQQ lead), market increased its 'short usd' positioning into year-end >>> price action yesterday pretty clear, soonest rates/bonds moves higher, UST's clear lead as usual

  • Already some headlines of 'worst start to the year since xx' for bonds and equity

  • VIX had an average of about 16 in 2023 - least volatile year for US equity since 2019

  • Beware 'January reversals' particularly when previous Q4 was so driven by FOMO and year-end (forced) rebalancing


 









''''So while it looks like stronger for longer is mostly likely to dominate, the our advice is to stay flexible.  If ‘24 is anything like ‘23, it’s going to be another volatile time for generating alpha.''' yups! I'll go for that - few very interesting point and charts there



Here are your SPX500 year-end forecast from major players!


Morgan Stanley 4'500

JPM 4'200

BoA 5'000

Deutsche Bank 5'100

Oppenheimer 5'200

Citi 5'100

Cantor 4'400

Wells 4'600

BMO 5'100

GS 5'100

SocGen 4'750

Barcx 4'800

UBS 4'850






NASDAQ - been on a pretty crazy move since November - reversing - all about bonds and USD - bonds lead



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