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Daily Chartbook #141

www.dailychartbook.com

Daily Chartbook #141

Catch up on the day in 28 charts

Daily Chartbook
Feb 15
23
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Daily Chartbook #141

www.dailychartbook.com

Welcome back to Daily Chartbook: macro market charts, data, and insights pulled from various sources around the Internet by a solo retail investor.


1. Small biz optimism. Optimism "increased 0.5 points in January to 90.3, remaining below the 49-year average of 98".

NFIB

2. Weak USD. "Investors and analysts expect the dollar to weaken over the next 12 months".

BofA via Daily Shot

3. World Interest Rate Probabilities. "The implicit rate for the December Federal Open Market Committee meeting has never been higher since the start of the contract. Nearly at 5%, it suggests that there will be no rate cuts this year".

Never Been Higher | Fed funds rate for December FOMC meeting inch closer to 5%
John Authers

4. Last hike. Most fund managers see the last hike coming on May 3.

BofA via Daily Shot

5. Peak rate. "Investors increasingly see the terminal rate above 5%".

BofA via Daily Shot

6. Recession fears. "Recession odds peaked in Nov'22 at 77% and have since declined to 24% this month (down 27ppt MoM), lowest since Jun'22".

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BofA via @samro

7. Hard vs. soft. "One of the largest gaps between hard and soft data on record".

Goldman Sachs via TME

8. Financial conditions. "Overall financial conditions are now as easy as they were before the Fed started raising interest rates. .. In other words, it looks like more Fed hikes are needed to get inflation all the way back to the Fed’s 2% inflation target".

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Apollo via @carlquintanilla

9. Inflation expectations. "Fund managers expect lower inflation".

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BofA via @mortensenbach

10. Tail risk. The "biggest 'tail risk' remains 'higher-for-longer' inflation".

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BofA via @samro


11. CPI (I). Headline inflation increased by 0.5% in January (in-line), the most in 3 months.

Image
@zerohedge

12. CPI (II). Core inflation rose by 0.4% in January (in-line), the same pace as December.

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@zerohedge

13. CPI (III). "Core Services ex shelter up 0.27% M/M, lowest since October".

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@zerohedge

14. CPI (IV). "Services ex-rent — the metric Jay Powell has explicitly called out publicly — is still north of 7%, even though it's cooled a little".

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@callieabost

15. CPI (V). "Shelter CPI moved up to 7.9%, the highest rate of housing inflation since 1982".

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@charliebilello

16. CPI (VI). "Alternate US CPI [measures] accelerated last month".

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BofA via @mayhem4markets

17. Fed rate path. "The market's expectations for the Fed rate path is indicating a further upward shift following today's CPI data. Here is today, yesterday, & February 1's projected rate paths".

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@m_mcdonough

18. Breakevens. "Breakeven inflation expectations have surged since we got the +517k jobs report on Feb 3, and today's CPI print didn't bring them down. Powell has mentioned needing this to stay contained, 10-yr is ok, but 2- and 5-yr readings have spiked".

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@lizyoungstrat

19. SPR. "With the 26 million barrels release confirmed last night (due to Congress mandated sales), the size of the US Strategic Petroleum Reserve will drop to ~345 million barrels by mid-year, the lowest level in 40 years".

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@javierblas

20. Energy exposure. "Energy bulls losing interest".

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BofA via @callum_thomas

21. FMS cash levels. Fund manager cash levels ticked down but remain elevated.

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BofA via @credit_junk

22. FMS positioning (I). "Fund managers are positioned for bonds to outperform stocks (which they will do if there is a recession)".

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BofA via @callum_thomas

23. FMS positioning (II). "About 31% of investors are now underweight equities".

FMS 2
Bloomberg

24. ETF flows. "Investors are running away from large-cap equity ETFs, pulling nearly $3.8 billion over past week ... for past month, international funds (both equity and fixed income) have made up 65% of all fund inflows".

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Arbor Data via @lizannsonders

25. Exposure plans. "The crowd isn't planning to increase equity exposure. The question is whether or not the market forces them to chase?"

JPMorgan via TME

26. S&P vs. EM. "Price return correlations between the S&P 500 and MSCI EAFE/Emerging Markets are below 5-year averages and trending lower. That is a positive sign for global equities".

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@datatrekmb

27. Earnings revisions. "Looks like analysts got too pessimistic last year. The number of companies with earnings estimates being revised higher is climbing".

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@williedelwiche

28. Not convinced. And finally, the “rally from Oct 12th (blowout CPI) driven by easier financial conditions (lower yields, lower volatility, lower US dollar) [is] generally viewed by investors as a bear market rally (66%) rather than a new bull market (23%)".

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BofA via @samro

Thanks for reading!

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