sellside observations and the (Nov 7) week ahead; Zweig's Investing Rules; short personal note about next weekend
Welp, another NFP has come and gone and the WSJs official Fed whisperer has proclaimed NEUTRALITY
For somewhat MORE (and/or less)on NFP, well,
ZH: October Payrolls Smash Expectations Even As Unemployment Rate Unexpectedly Spikes
ZH: 'Bad' Payrolls Print Sparks Dovish Buying Panic Everywhere
THEN, ZH: Something Has Snapped: Unexplained 2.3 Million Jobs Gap Emerges In Broken Payrolls Report
Sorry .. not sorry. Without a Terminal and my own capability to connect some dots in depth, ZH increasingly all I’ve got …
In as far as DOTS CONNECTING goes, on TO some sellside narratives goes, I’ve collected a few links and excerpts for you HERE … I’m increasingly short on time the further removed FROM the sellside and so I’ve included links (if permissioned — if not, please reach out and we’ll figure something out) as well as real short excerpts. These are the hand picked few that I’d still spend some time reading / digesting / understanding (and making sure my former clients and friends saw and grasped, too).
My FIRST observed observation is that BMOs got something to say on the belly (ie 5s vs 2s10s). BAML still ‘favors selling rallies’ (10s). JPM seems worried and worth a read.
…we are worried about valuations overshooting to the upside: yield based buyers have yet to return, and price insensitive sources of demand could turn sellers once again, given the recent rally in the US dollar…
….…moreover, there is a risk investors turn more neutral heading into an illiquid year-end. Our Treasury Client Survey has lengthened this year to near the longest levels since Fall 2020, and any long liquidations would drive yields higher: stay neutral on duration
If THEY are worried, it’s likely we’re supposed to be as well … There’s plenty more to mull over HERE on this weekeneds observations
In addition to THESE sellside narratives, a few other links from the intertubes.
Scott WHERE’S MY NECK Minderd on NFP reaction
Macro Alert: The Jobs Data Trend is Duration's Friend
… Based on these data, a step down in the pace of tightening to 50 basis points in December still looks likely. The market is currently pricing in 58 basis points for the December Federal Open Market Committee (FOMC) meeting, and a terminal effective fed funds rate of 5.13 percent in May/June 2023. It remains to be seen whether that turns out to be correct, but all eyes turn to the Consumer Price Index release on Nov. 10 for further confirmatory evidence that the effects of “cumulative tightening” support a downshift in the pace of Fed tightening.
Chart Of The Day asks what is in a name — TIPS — and offers 19 related charts
What's in a name? -- iShares Treasury Inflation-Protected Securities ETF (TIP)
AllStarCharts piles on to bonds, trash talking like everyone else,
A Relative Bid Goes a Long Way
Bonds are an absolute dumpster fire.
Everyone knows fixed income is having one of its worst years on record. And, from the looks of it, we’ll all be dragging our Christmas trees to the curb before US Treasuries stage a miraculous comeback.
Don’t get me wrong. I believe these safe haven assets will dig in and catch higher – eventually. There’s just no sign of it happening any time soon.
Instead of focusing on the disappointing performance of bonds, let’s turn our attention to its relative trends against other major asset classes – stocks and commodities.
Here’s the commodities versus bonds ratio using the CRB Commodity Index and the 30-year Treasury bond futures:
Also and perhaps MORE importantly from the so called ALL STARS of charting are some RULES OF TRRADING … Marty Zweigs,
Moving on then TO the week ahead AND for any / all (still)interested in trying to plan your trades and trade your plans in / around FUNduhMENTALs, here are a couple economic calendars and LINKS I used when I was closer to and IN ‘the game’.
First, this from the best in the strategy biz is a LINK thru TO this calendar,
Wells FARGOs version, if you prefer …
… and lets NOT forget EconOday links (among the best available and most useful IMO), GLOBALLY HERE and as far as US domestically (only) HERE …
Now before closing and hittin’ SEND with your ‘reading assignment / homework’ ahead of markets opening this evening, I’m going to give some advanced warning now.
There’s likely NOT to be ANY update NEXT WEEKEND as it’s likely Thing 1s FINAL football game ever. As his D3 career comes to an end (although an outside chance of a ‘bowl game’ / bid IF they defeat MIT) I’ll be travelling and celebrating his accomplishments. We’re HOPEFULLY doing that alongside an offer or two upon graduation after this week which has just passed was, to say the very least, a VERY exciting one. It culminated in his teams double overtime WIN vs Coast Guard Academy and a couple quick snapshots from the game,
And a couple viewers from down deep stopped by to witness the epic comeback double overtime WIN!
What an AMAZING (near) finish to a storied D3 career … Cannot wait to see what ever is next for this kid — lets HOPE it begins with another W next weekend against MIT!
THAT is all for now. Enjoy whatever is left of YOUR weekend …