The probability of a Fed hike in June is now at 94%. Markets expect 2.5 hikes in total for 2017. Central Bank Balance Sheets The next two charts detail the size of the major central bank balance sheets The U.S. Treasury yield curve remains hesitant to expect a… Continue reading Central Banks
U.S. and Eurozone Citi Economic Surprise Indexes diverge. Citi vs Bloomberg U.S. Economic Surprise indexes Homeownership rate remains low Auto Sales For the fourth straight month auto sales came in below estimates (red bar, bottom panel). Auto sales (blue line, top panel) remain near a two-year low. Car… Continue reading Economics
The World Bank tracks the GDP of roughly 200 countries across the globe. The chart below shows the top ten countries by contribution to world GDP. While the U.S. accounted for almost 40% of the world’s GDP in 1960, it now accounts for less than 25%. Unsurprisingly, China has grown the most by this metric… Continue reading Miscellaneous Charts
President’s Approval Comparison: The chart below shows the complete history of Gallup’s presidential approval rating back to 1938. The first tab (Presidents’ Rating Comparison) shows the first 100 days of all presidents’ approval ratings since the Great Depression. The middle tab (Presidents’ Ratings Over Time) shows all the Presidents back to 1938. Note you can pick… Continue reading Politics
Bloomberg – JPMorgan Quant Says Buy Bank Puts Before Jobs Data, French Polls Bank advises buying financial ETF puts, Treasury ETF calls “If Friday’s payroll report disappoints, the back-to-back weaker results may cause investors to further question the economy’s momentum,” Shawn Quigg and Marko Kolanovic, New York-based research strategists at JPMorgan, wrote in a report dated… Continue reading Financials on Edge Ahead of Payrolls
The Wall Street Journal – Fed Rate Rise Unlikely Wednesday, but Possible June Move in Focus Fed statement could give hints about the likelihood of a rate increase at the June 13-14 policy meeting Next to no one expects Federal Reserve officials to raise short-term interest rates at the conclusion of their two-day policy meeting Wednesday.… Continue reading Fed Unlikely To Raise Rates Today
Bloomberg – Russia Said to Back Extending OPEC Deal After Hitting Target Russia sees sense in extending output deal for six months Russia considers it sensible to extend the existing deal with OPEC to curb crude output for at least six months, given current market dynamics, according to a government official with knowledge of the matter.… Continue reading Energy Stocks Increasingly Bearish on Oil
Reuters.com – Rising U.S. oil production knocks OPEC off course: Kemp Production continued rising in March and April, and now stands at over 9.2 million bpd, according to weekly estimates published by the agency (“Weekly Petroleum Status Report”, EIA, April 26). Weekly estimates are considered less reliable than the monthly numbers, but the two series have… Continue reading U.S. Oil Production Continues To Rise
The Wall Street Journal – Rising Interest Rates May Trip Oil Companies New study warns that rate increases could erase efficiency gains made by shale producers U.S. oil companies have proven remarkably resilient even during a prolonged season of lower oil prices, but a looming threat could limit their growth and profitability: rising interest rates. A new… Continue reading How Rising Rates Could Hurt Oil Companies
The Wall Street Journal – Greg Ip: Corporate Tax Cut as Growth Elixir? Foreign Experience Suggests Caution Last week President Donald Trump proposed slashing the corporate tax rate to 15% as the centerpiece of a tax plan designed to boost economic growth. He is in good company. Between 2000 and 2016, most of the U.S.’… Continue reading More On Tax Reform
The Financial Times – Slumbering volatility the market surprise for 2017 Vix drops briefly below 10 as Wall Street fear gauge signals calm trading for May Measures of US market volatility continue retreating and remain historically subdued as investors anticipate calm trading conditions in the coming month, with Wall Street’s barometer of fear near lows previously… Continue reading More On Low Volatility
The Financial Times – US share buyback plan approvals plunge Stock market’s surge this year may be curbing a key source of demand for equities Companies on the S&P 500 index have authorised $146bn in share buybacks this year, down 15 per cent from a year ago, according to data from Goldman Sachs. Executives have also… Continue reading Stock Buybacks Dip