Market Recap   Market’s swooned earlier in the week on the Evergrande story, but didn’t stay down long. The prospect of a large company with a huge amount of debt possibly defaulting had echoes of Lehman all over it. But is that actually the case? More below.   But one thing was sure, it didn’t take much for investors to show signs of panic. For example, the number of put options bought on Monday…
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  Market Recap   Most equity markets finished lower on the week, although commodity prices were generally higher. Gold and silver struggled with the stronger dollar.   There were two big macro reports. The first concerned inflation. The Consumer Price Index for August was up +5.25% year-over-year, down from +5.37% the previous month. Core was up +4.00%, as you can see below.     While you can’t tell from the chart above, this report was…
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Market Recap   It’s September already? Really? Well, August closed on a positive note and the S&P has now been in the black for seven months in a row. Not quite rarified air, but it’s getting there, as you can see below.       So naturally we must be due for a correction? Maybe. Septembers tend to trade on the soft side, but the historical performance after seven month win streaks for the S&P…
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  Market Recap   Equity markets rallied this week on a couple things. First, Fed Chairman Powell basically said nothing to upset the applecart at the annual Jackson Hole meeting (more below). And some optimists started making the case that the spread of the delta variant was peaking. Looking at the charts below you have to squint pretty hard to see that…     …but maybe the dip in the pace of hospital admissions in…
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  Market Recap   Something of a bumpy week with a number of crosscurrents. A Fed meeting, corporate earnings reports, and another clamp down by the Chinese authorities on some private firms all grabbed investor’s attention. Some of the highlights:   Growth Moderates – Supply Concerns Weigh   The first estimate for second quarter GDP growth was released this week. This initial number came in at +6.5%, 1.9% below estimates (chart below).     The…
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  Market Recap   A good week for most equity markets with the exception of some emerging countries, particularly China. There is definitely a summer lull type of feeling to the last few weeks, but earnings results are trickling out and the numbers are coming in solid. Through Thursday roughly 18% of S&P 500 companies have reported Q2 earnings. As you can see below, 86% beat earnings estimates and earnings are up +99% y/y, helped…
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  Market Recap   There were a couple main economic reports for the week.   Consumers still have cash and are willing to spend it. Retail sales came in at + 0.6% month-over-month in June versus expectations for a fall of -0.4%. Year-over-year growth is running at over +15%, as you can see below.     The other biggie was the consumer price inflation (CPI) number for June. It was up +5.4% year-over-year, above expectations…
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  Market Recap   Last week the reflation trade was a bust after the Fed hinted they might hike interest rates many moons from now. This week those same trades (value stocks, commodities, natural resource stocks, etc.) popped higher on the same idea, namely than any rate hike is many moons from now. Don’t you love it?!   On the inflation front, the latest personal consumption expenditure index came in at +0.5% month-over-month in May…
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