Posts filed under “Think Tank”

China remains the swing factor

Better than expected earnings from Alcoa (partially citing China) and Chinese car sales rising 48% y/o/y in June are helping to lift commodities and in turn global stock markets. On the AA call, the CEO made an interesting comment about China according to Bloomberg, “One of the things that the Chinese government very smartly does these days is that they are stimulating people that it’s good to not have too much savings and to buy new cars and get a new air conditioner.” The BoE left rates unchanged and kept its quantitative easing program in place to buy a total of 150b pounds of gilts which will be complete next month. They will review it again at their August meeting. Some thought they would increase the amount and Gilts are down sharply in response as is the Pound. US Treasuries are following on the downside and the reaction highlights the risk with QE. With the Yen at 5 month highs, a Japanese official said excessive currency moves is undesirable. The Nikkei was lower due to the Yen spike. Initial Jobless Claims are expected to total 603k vs 614k last week. Continuing Claims are expected to rise modestly. June comps so far look weaker than expected.

Category: MacroNotes

Gold Market Weekly Report

For the holiday shortened week, spot gold closed at $929.80 per ounce, down $9.80 or 1.04 percent. Gold equities, as measured by the XAU Gold & Silver Index (12) fell by 2.64 percent for the week. The U.S. Trade-Weighted Dollar Index (13) gained 0.52 percent. Key Research Points: • Turkey, the world’s third-largest manufacturer of…Read More

Category: Commodities, Think Tank

Ahead of the reopening of the 10 yr bond auction and with the S&P’s back to where they were on May 1st, we can compare where interest rates, inflation expectations, the US$ and the CRB index were on May 1st with today’s level in the S&P’s in order to gauge the impact of treasury supply…Read More

Category: MacroNotes

Consumer Credit

May Consumer Credit fell $3.2b to $2.519 trillion (SA) but $5.6b less than anticipated. Consumer credit outstanding is now at the lowest level since Dec ’07 and May is the 8th month in the past 9 that has seen a decline. Most of the decline was in revolving credit which fell $2.9b while non revolving…Read More

Category: MacroNotes

King Report: Who Cares About Moving Averages?

> There is mucho pontificating by research types and pundits that ‘all is still well because the S&P 500 held its 200-day moving average. These people are wrong and misguided. Long-time readers know that we regularly assert that the slope of the moving average is of paramount importance and breaches that are contra to the…Read More

Category: Think Tank, Trading

10 year note auction

The reopening of the 10 year note auction was solid as the yield was 4 bps lower than where the when issued was trading and the bid to cover of 3.28 was well above the one year average of 2.31 and at the highest level since at least 1994. This also comes in the context…Read More

Category: MacroNotes

Rate hike odds

Coincident with the pullback in most markets over the past few weeks on doubts with the robustness of the 2nd half global economic recovery, the fed funds futures have been pricing in lowered odds of a fed rate hike by year end. Odds of a 25 bps hike to .50% by December is near 20%…Read More

Category: MacroNotes

8,893 “Bill Millers”

> I am especially pleased to present today’s Think Tank piece by James Bianco. Jim has run Bianco Research out of Chicago since November 1990. He has been producing fixed income commentaries with a circulation of hundreds of portfolio managers and traders. Jim’s commentaries have a special emphasis on: money flow characteristics of primary dealers,…Read More

Category: Index/ETFs, Investing, Think Tank

Show Me The Shoots or we’ll see a bath tub shaped recovery

Show Me The Shoots, the green shoots that is. It is what every investor is watching and looking for as we begin Q2 earnings season, with guidance being of the utmost importance. The shape of the 2nd half recovery will hopefully get some clarity. Since I believe consumer spending will remain punk, if inventory restocking…Read More

Category: MacroNotes

King Report: More Goldman Intrigue

> FT’s Alphaville published the resume of Serge Alevenkov, the indicted Goldman programmer: VP, Equity Strategy Goldman Sachs (Public Company; GS; Investment Banking industry) May 2007 — Present (2 years 3 months) • Lead development of a distributed real-time co-located high-frequency trading (HFT) platform. The main objective was to engineer a very low latency (microseconds)…Read More

Category: Think Tank