Friday, September 4, 2020

Morning Note: Time Will Tell

Asian stocks for the most part took the U.S.'s lead into their session last night; 13 of the 16 markets we track closed in the red. Europe's fairing a bit better this morning; 10 of 19 indices trading higher so far. U.S. equities are struggling: Dow down 109 points (-0.39%), S&P 500 down -1.25%, Nasdaq down -2.79%, Russell 2000 down -1.16%.

The VIX (SP500 implied volatility) is higher by 3.66%. VXN (Nasdaq vol) is also signaling heightened risk right here, up 7.89%.

Oil futures are down -2.42%, gold's down -0.35%, silver's down -0.42%, copper futures are up 1.59% and the ag complex is up 0.14% as I type.

The 10-year treasury is down (yield higher) and the dollar is catching a strong bid this morning, up 0.49% (a potential headwind, as I've been stressing herein)...

Bucking the weakness in equities, our core portfolio is essentially flat to start the day, -0.12%. Leading our 8 winners are banks, Verizon, financials (broad-based), base metals and ag commodities. The 10 losers are being led lower by tech, emerging market equities, Eurozone equities, healthcare and Asia-pac equities.

I'll leave you this morning with this (from yesterday) from our inner-office research thread:

"M: Make sure you're all digesting every single blog post... when I say the internals right here means risk is at an extreme, plus the macro is so historically messy, know that the market can roll over big at any moment... regardless of pending news, etc...

I've been pointing to the precariousness of the dollar, and the Euro, and their oversold and overbought conditions... these are immediate risks... the ECB makes a move that sends the Euro down (the dollar will rally), that alone could be the catalyst that gets the snowball rolling.... and it has zero to do with US election timing...

All that said, today could easily be a big head-fake..." 

Time will tell...

Have a great day!
Marty


No comments:

Post a Comment