Getting Stuck
March 24, 2023 Good morning, Despite a symphony of assurances by central bank officials around the world that financial institutions are stable and liquidity in their respective markets is adequate, we have yet another “run” of sorts this morning on a new name to this crisis narrative – Deutsche Bank (DB). Banks can’t get a […]
Fed Threading The Proverbial Needle
March 22, 2023 Good morning, It’s Fed day with a Fed that is truly stuck in the middle. It’s clear that the Fed’s restrictive policies are causing instability in some pockets of the financial sector. At the same time, there’s plenty of reason to believe that other parts of the economy are in a state […]
It’s Complicated
March 20, 2023 Good morning, The Swiss government appears to have forced a shotgun sale of Credit Suisse (CS) to UBS (formerly named Union Bank of Switzerland) over the weekend, and while only last week this combination was expected to be an elixir of any approaching European bank crisis, it is this morning nothing of […]
Unraveling Rescue Packages
March 17, 2023 Good morning, Yesterday’s equity market rally, largely driven by various rescue solutions for key European and U.S. banks lying in their respective ICU units, continued into the overnight session. That is right until Credit Suisse (CS) and Union Bank of Switzerland (UBS) denied rescue and any interest in combining at 4am ET. […]
Crisis Du Jour
March 15, 2023 Good morning, Following yesterday’s market recovery from the near financial crisis in U.S. regional banks, we awake this morning to a new financial crisis unfolding in the European banking system. The culprit du jour: Credit Suisse (CS). The company’s shares dropped 25% upon disclosing that its top shareholder ruled out providing more […]
In Crisis Now
March 13, 2023 Good morning, The U.S. is in a liquidity crisis. So much has happened since the closing bell rang on Friday and the failure of Silicon Valley Bank (SVP). The most obvious thing to note is the quick policy response of U.S. authorities over the weekend, which protects even uninsured depositors and offers […]
The Unexpected Wrinkle
March 10, 2023 Good morning, The much-anticipated monthly employment numbers came out this morning. While headline job growth was an upside surprise at +311k vs +225k expected (too hot), the unemployment number rose more than expected to 3.6%, up +0.2%. That unemployment number and lower than expected wage growth trumped jobs growth, and the overall […]
Uptrend Influence Still Lingers
March 8, 2023 Good morning, All eyes were on Fed Chair Jerome Powell yesterday morning as he began giving his prepared speech to the Senate Finance Committee. Markets expected a reiteration of last Fed meeting’s higher-for-longer Fed narrative, steady 25 basis point (bps) hikes at the next few Fed meetings in March, April and maybe […]
Big Week
March 6, 2023 Good morning, The S&P 500 Index (SPX) ended up +1.90% last week, its first up week in the last four. I think that puts February’s correction in the rearview mirror. Asset markets (stocks, bonds, commodities, currencies) remain in a kind of myopic phase, where the only driver of return expectations seems to […]
The Big Question
March 3, 2023 Good morning, The market’s pause continues. The S&P 500 Index (SPX) closed yesterday +.28% above last Friday’s close. Unfortunately, that is not enough of a buffer to assume we’ll get an up week on the SPX this week. This week does follow three down weeks in a row, so the bulls could […]
Short One
March 1, 2023 Good morning, Not much to say this morning, markets seem to be on pause. The S&P 500 Index closed last night precisely where it ended last week. The same goes for bond yields. Futures are up a whopping .25% pre-market this morning and most of that can be attributed to surprisingly good […]
Leaning Slightly Bullish and In Line with Cycles Chart
February 27, 2023 Good morning, The shortest month of the year is coming to an end and none too soon. The S&P 500 Index (SPX) had its worst week since December and was down -2.67% last week. February has taken back about half of January’s gains. A -4.5% correction on the SPX is not a […]