Wednesday, December 18, 2024

Stocks Close Substantially Lower on Powell's Post-Election Hawkishness, Another Massively Irresponsible US Government Spending Bill, Surging Long-Term Rates, Consumer Discretionary/Financial Sector Weakness

Economic Gauges:

  • Bloomberg Emerging Markets Currency Index 37.1 -.54%
  • 3-Month T-Bill Yield 4.34% +3.0 basis points
  • China Iron Ore Spot 102.4 USD/Metric Tonne -.3%
  • Dutch TTF Nat Gas(European benchmark) 41.0 euros/megawatt-hour -2.5%
  • Citi US Economic Surprise Index 9.5 +.5 point
  • Citi Eurozone Economic Surprise Index -8.7 +1.2 points
  • Citi Emerging Markets Economic Surprise Index -2.6 +.3 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(6 of 500 reporting) +7.9% -1.8 percentage points
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 271.28 +.04:  Growth Rate +13.7% +.1 percentage point, P/E 22.4 +.1
  • S&P 500 Current Year Estimated Profit Margin 12.55% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(0 of 10 reporting) n/a
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 386.36 +.26: Growth Rate +23.2% +.1 percentage point, P/E 35.3 -.1
  • Bloomberg US Financial Conditions Index .79 -8.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index .97 unch.
  • US Yield Curve 13.0 basis points (2s/10s) -1.5 basis points
  • US Atlanta Fed Q4 GDPNow Forecast +3.33% unch.
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 28.3% +1.8 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.97% unch.: CPI YoY +2.86% unch.
  • 10-Year TIPS Spread 2.32 +1.0 basis point
  • Highest target rate probability for Jan. 29th FOMC meeting: 90.3% (+8.7 percentage points) chance of 4.25%-4.5%. Highest target rate probability for March 19th meeting: 56.0%(+16.0 percentage points) chance of 4.0%-4.25%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating +178 open in Japan 
  • China A50 Futures: Indicating -100 open in China
  • DAX Futures: Indicating -253 open in Germany
Portfolio:
  • Lower:  On losses in my tech/industrial/financial/consumer discretionary/utility sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges and to my emerging market shorts
Market Exposure: Moved to 25% Net Long

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