Monday, January 24, 2022

Morning Note: Pressure

Geopolitical (Russia), political (WH pressure on the Fed to quell inflation) and inflation (the Fed) pressures have global equities selling off notably to start the week. 

Actually, the selloff extends beyond just equity markets, as commodities (save for gold, nat gas and wheat) are taking it on the chin this morning as well.

The tense geopolitical setup is presently very fluid so we'll not attempt to add any color there at this point. 

As for the Fed, their January policy meeting happens tomorrow and Wednesday, with world markets nervously awaiting Wednesday's announcement and press conference. Question being, will they maintain their now "hawkish" (well, certainly relative to what the market's grown accustomed to) stance and promise to whip inflation, as opposed to support asset prices? Political pressure of late has been on the former... We'll see...

Asia had a rough evening, with all of the markets (save for Japan and China) we track closing lower.

Europe's getting battered this morning, with equities markets in the red literally across the board.

US major averages are selling off to start the week as well: Dow down 527 points (1.52%), SP500 down 1.90%, SP500 Equal Weight down 1.64%, Nasdaq 100 down 1.91%, Nasdaq Comp down 2.03%, Russell 2000 down 1.49%.

The VIX sits at 34.46, up 19.45%.

Oil futures are down 1.93%, gold's up 0.13%, silver's down 2.10%, copper futures are down 2.27% and the ag complex is down 1.04%.

The 10-year treasury is up (yield down) and the dollar is up 0.45%.

Led by Verizon, Gold and Treasury Inflation Protected treasuries -- but dragged by everything else (especially uranium miners, AMD [chip maker], MP [rare earth miner], solar stocks and base metals miners -- our core allocation is off 1.04% to begin the session.

Seems timely to quote the all-time great one:

" many men in Wall Street, who are not at all in the sucker class, not even in the third grade, nevertheless lose money. The market does not beat them. They beat themselves, because though they have brains they cannot sit tight.

--Jesse Livermore 

Well, certainly, by all means sit tight, but only when you've done (continue to do) the work and are confident in your long-term thesis. 

Have a great day!

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