Tuesday, February 13, 2024

Morning Note: On the Other Hand.....

Yesterday I shared a thread by BCA Chief Strategist Peter Berezin, who now sees likely weakness among US consumer and, thus, the US economy as well in the coming months... That scenario would be met with falling yields.

Today, in contrast, I'm offering up the alternative scenario from Bianco Research's Jim Bianco, who sees no recession this year, and anticipates rates breaking to the upside over the coming weeks.

As we've expressed herein, the market's in a tough spot right here... In the recession scenario, corporate earnings take a hit, and, believe me, stocks are in no way priced for it right here... In a no-recession scenario, yields do not decline -- per the below, according to Jim they rise -- and, alas, stocks are in no way priced for that either, per this morning’s initial reaction to January’s CPI print:

Stay tuned...

Asian equities were mixed overnight (China markets shuttered), with 6 of markets we track closing lower.

Europe's in the red so far this morning, with 15 of the 19 bourses we follow trading down as I type.

As are US equity averages to start the session: Dow down 506 points (1.30%), SP500 down 1.37%, SP500 Equal Weight down 1.79%, Nasdaq 100 down 1.56%, Nasdaq Comp down 1.66%, Russell 2000 down 3.66%.

This morning the VIX sits at 14.72.

Oil futures are up 0.37%, nat gas futures are down 5.60%, gold's down 1.22%, silver's down 2.77, copper futures are down 0.08% and the ag complex (DBA) is down 0.04%.

The 10-year treasury is down (yield up) and the dollar is up 0.61%.

Among our 33 core positions (excluding options hedges, cash and money market funds), none (save for put options of course) are in the green so far this morning... The losers are being led lower by XME (base metals miners), Dutch Bros, EWZ (Brazil equities), SLV (silver) and XLRE (REITs).

Be careful out there:
"Novelists and historians have known for centuries that people do not deploy the powerful human intellect to dispassionately analyze the world, but rather to rationalize how the facts conform to their emotionally derived preconceptions."

--William Bernstein, The Delusions of Crowds: Why People Go Mad in Groups

Have a great day!

No comments:

Post a Comment