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1. Strategic Petroleum Reserves. "The Biden admin said they would refill the SPR when oil prices were at or below $67-$72--we've been in or under that ‘buy zone’ for over a week now...and crickets."
2. Truck tonnage. For-hire truck tonnage increased 1.2% in February for the third straight monthly rise.
3. FIMA repo. "This is what scares everyone today imho. A foreign central bank (not covered by FX swap lines) MAXED out the FIMA repo."
4. Bank deposits. "Deposits have been declining for both small and large banks since the Fed began to raise rates in March 2022."
5. Corporate debt. "Q1 defaults have already surpassed the full year totals of 2021 and 2022 combined."
6. Distressed debt. "The heap of dollar-denominated corporate bonds and loans in the Americas trading at distressed levels rose to $295.4 billion in the week ended Friday, a 28.7% increase from $229.5 billion a week earlier."
7. Accounting fraud. "The probability of earnings manipulation usually rises rapidly in the quarters before the economy tips into recession. Today, the M-Score shows that the collective probability of fraud across major companies is the highest in over 40 years."
8. Consumer spending (I). "Recent bank failures in the US have raised questions about the consequences for consumers. .. our Chase consumer card transactions data (credit and debit) through March 19 do not show a meaningful impact on spending in the first week after the event."
9. Consumer spending (II). "Card spending has been slowing since Jan. At the national level, it has not been clearly impacted by regional banking stress."
10. Consumer spending (III). "A sign of consumer confidence cratering — credit card spending has collapsed."
11. Durable goods (I). "February durable goods orders -1% m/m vs. +0.2% est. & -5% in prior month (rev down from -4.5%); orders ex-transportation 0% m/m vs. +0.2% est. & +0.4% prior (rev down from +0.8%) … year/year growth for headline orders (orange) has eased to +1%."
12. Durable goods (II). "Inflation-adjusted orders for durable goods show less momentum."
13. Flash composite PMI. "March S&P Global U.S. Composite PMI (chart) moved up to 53.3 [fastest pace since May 2022] vs. 49.5 est. & 50.1 prior; Manufacturing PMI up to 49.3 vs. 47 est. & 47.3 prior; Services PMI up to 53.8 vs. 50.3 est. & 50.6 prior."
14. Yield inversions (I). "The 3m2Y spread has never been this inverted."
15. Yield inversions (II). "Huge distortions and volatility in US rates/bond markets encapsulated by the 3-month/10-year yield curve, now -150 bps, the flattest and most inverted since 1981."
16. IG/HY spreads. "The spread between investment grade and high yield/distress has moved massively post the banking crisis."
17. Event volatility. Stocks have seen the most volatility on jobs days this year.
18. Flight to safety. "Global cash funds had inflows of nearly $143 billion, the largest since March 2020 in the week through Wednesday — adding up to more than $300 billion over the past four weeks...Money market funds assets have soared to more than $5.1 trillion, the highest level on record."
19. Household allocations. "US households' equity allocation remains high."
20. Household demand. "Model forecasts that households will sell equities in 2023 and 2024."
21. Stock positioning. "The GS sentiment indicator remains negative."
22. Global equity positioning. "Global hedge fund long/Short ratio near lows."
23. CTAs vs. equities. "GS Strats have S&P positioning short -$31B. That is the lowest level of all -time. Asymmetry skewed significantly to the upside now."
24. Tech valuations. "Tech multiples are too high for the current interest rate environment and growth challenges that these companies are facing."
25. Factor valuations. "Sector-neutral S&P 500 factor P/E valuation percentile rank vs. 40-year history."
26. EPS estimates. "2023 EPS estimates haven't really moved in the last two weeks despite negative headlines and rate cut expectations. Very possible we hear about more revisions as Q1 earnings season ramps up."
27. S&P revenues. "With earnings flat and margins down, that means revenues are still rising. Indeed, the chart below shows that S&P 500 revenues-per-share continue to stair-step their way to new all-time highs."
28. Price targets (I). "Industry analysts in aggregate predict the S&P 500 will see a price increase of 17.0% over the next 12 months." This implies a price target of $4,618.
29. Price targets (II). And finally, “since bottoming at 4462.23 on November 9, 2022, the bottom-up target price for the S&P 500 has increased by 3.5%.”
Have a great weekend!
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