Daily Chartbook #166

Welcome back to Daily Chartbook: the day’s best charts & insights, curated.

1. US petroleum inventories. "Charts on US petroleum inventories in MB."

2. US petroleum exports. "US total petroleum exports (crude oil and refined products) last week surged to a new record high of ~12 million b/d."

3. MBA mortgage data (I). "With higher mortgage rates, the refinance index declined sharply in 2022."

4. MBA mortgage data (II). "Purchase activity is down 36% year-over-year unadjusted."

5. Financial conditions. NFCI “was –0.24 in the week ending March 17, suggesting financial conditions tightened."

6. Credit conditions. "The University of Michigan asks consumers about credit conditions, and the chart below shows that even before the SVB situation, credit conditions had tightened to levels last seen in 2008."

7. CRE (I). "Commercial real estate is in trouble, so the next question become who holds most of it on their books? The overwhelming answer is mid-sized banks."

8. CRE (II). "One area of particular concern has been the office property sector where regional banks have an outsized exposure to office loans."

9. Fed hikes (I). The Fed unanimously hiked rates by 25 bps.

10. Fed hikes (II). "Side-by side dots.  No big changes, but look at the enormous spread of forecasts for 24/25. They just don't know."

11. Fed hikes (III). Updated FOMC statement.

12. Fed funds futures (I). "The only other months to see such volatility in fed funds futures were: January 2001, September 2001, January and October of 2008; and March 2020."

13. Fed funds futures (II). "Fed Funds Futures are now pricing in the first rate CUT in July and an additional two cuts by end of year."

14. Stocks vs. bonds vs. unemployment. "From low ERP levels and with rising unemployment, equities seldom outperform bonds - late-cycle risks often outweigh prospective returns from moving up the risk curve, unless the momentum for the growth/inflation mix is positive."

15. Global equities vs. conditions. "What happens when one or more of these five things are happening? 1) SPX forward earnings declining; 2) yield curve inverted; 3) Unemployment below avg; 4) Mfg PMIs < 50; 5) 40% of banks tightening lending standards...All five are in place today, which is rare."

16. Bond inflows. "BofA’s private clients continue to buy bonds."

17. Liquidity. "Liquidity has fallen off a cliff. Reshuffling risk is costly these days as prices are massively impacted by even the not so big orders."

18. Active managers. "The most bearish active managers are the most short they've been on US stocks since the beginning of the Russia-Ukraine conflict. Also note the dispersion in conviction--the bulls are very bullish while the bears are very bearish. Both can't be right…"

19. CTAs vs SPX (I). "Our CTA positioning metrics estimate positioning in SPX is at the LOWEST LEVEL OF ALL TIME (-$31bn)."

20. CTAs vs. SPX (II). "The buying in an up tape could be up to $60bn. Add to this poor liquidity and things risk getting painful for CTAs."

21. CTA performance. Last week, "CTAs had their worst 3-day performance in 3 decades."

22. Pure leverage. "A Bloomberg index that goes long highly leveraged stocks and shorts those with limited debt just posted its worst week since April 2020."

23. Megacap tech. "This chart provides some context on the recent mega-cap technology outperformance. It's almost on par with the flight-to-safety trade post the Covid crash."

24. Buybacks. "S&P 500 companies in 4Q22 continued their retreat from record-breaking buybacks in 1Q22; share repurchases $211.2B in 4Q vs. $210.8B in 3Q and $270.1B a year ago."

25. Earnings estimates (I). "S&P Global just released their 2024 earnings estimates. They are suggesting that earnings will surge well above long-term growth trends, and well above economic growth expectations without the benefit of inflation, stimulus, and low rates."

26. Earnings estimates (II). "Earnings estimates are starting to stabilize suggesting that Wall Street is becoming more confident a recession will be avoided."

27. Earnings uncertainty. And finally, there's "a growing dispersion in analyst earnings estimates (typically occurs during risk-off periods)."

Thanks for reading!