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U.S PCE as exp/JPM collar for Q3 / NQ : best 1st half ever, SPX7 / CROSSJPY's higher w/yields & risk



  • July! must be the start of the TdF, have a great start to H2 2023!

  • US PCE deflator drops to 3.8% y/y as expected while the core drops a little more than expected to 4.6%, inflation cooling, as expected >>> FED expectations jumped higher for 2023, 2 hikes on the cards now

  • UK Crypto, Stablecoin Laws Approved by Parliament's Upper House

  • U.S. Supreme Court blocks President Biden's plan to cancel $430 billion in student loan debt Fiscal impulse cancelled, for now anyway

  • France imposed partial ban on internet

  • Higher interest encourage savings and/or deleveraging, perhaps both, eventually

  • Media mentions of "artificial intelligence" just dropped off a cliff in last few weeks

  • PIMCO says it's bracing for a 'harder landing' for the global economy, warning investors are too hopeful about interest-rate cuts

  • Supreme Court blocking student-debt forgiveness will ‘devastate’ borrowers. No, it would ‘punish’ poor Americans. Who’s right?

  • Turkey State banks 'resumed' intervention to support TRY, spending about $1 bln intervening Monday >>> USDTRY now 26+

 
Markets :
  • 1year UST yield is now higher than S&P 500 earnings yield >>> not since 2000

  • The BIG JPM collar (sources) for this quarter now is ''short the 4670call on SPX, and long put spread 4215 vs 3560'', after a YTD rally of nearly 16%

  • NQ best 1st half ever, up 30%, while China got hammered, what a divergence! particularly vs S&P7's ! AAPL closed on 3trn market cap - just whaoo

  • U.S rates back up, after quarter-end bond rally, even EU rates higher with relative ease, that's after weak EU PMI last week >>> lots of issuance coming in H2, ongoing QT etc won't make it easy for bonds (and risk eventually), HYG etc in H2 2023

  • USD mixed, CROSSJPY's remain the name of the game with risk and yields higher!

  • Crude WTI held/back above 70$ - Andurand HF story below below (assuming other HF did similar, may well be part of the story of Q2 prices lower..) and Saudis/Russia announced an extension of oil export curbs

  • STELLAR year for stocks....remember how negative 95% of economist were at the start of the year ?.. we stick to our valuation model when investing for our clients, iit works very well, guessing market sentiment in short-term, quarter by quarter, is Very difficult, the 'market' and CNBC keep trying.. it's fun to watch

 

Data for week coming up :

MONDAY July 3rd: Swiss CPI (Jun), EZ/UK/US Manufacturing PMI Final (Jun), US ISM Manufacturing PMI (Jun)

TUE: July 4th RBA Announcement, NBH Announcement, South Korean CPI (Jun), German Trade Balance (May)

WED: July 5th FOMC Minutes, Chinese Caixin Services PMI Final (Jun), EZ/UK/US Services & Composite PMI Final (Jun), US Durable Goods R (May)

THU: July 6th NBP Announcement, Australian Trade Balance (May), EZ Retail Sales (May), US ADP National Employment (Jun), US ISM Services PMI (Jun) Opec Seminar

FRI July 7th : German Industrial Output (May), US Jobs Report (Jun), Canadian Jobs Report (Jun)









certainly pretty much all analysts..







at 3trn market cap!






have a great start to the week, month, Q3 and H2 2023 !

Team PVM



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