Daily Chartbook #220
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Daily Chartbook #220
Catch up on the day in 29 charts
Welcome back to Daily Chartbook: the day’s best charts & insights, curated.
As a reminder: DC will not be published on Monday, June 19.
1. Hard vs. soft data. "The gap between hard and soft economic data is the highest in 20 years."
2. Credit conditions vs. retail sales. "Tighter credit conditions posit that retail sales will continue to weaken through the rest of the year."
3. Card spending. "Consumption looks like it started off the month of June on a strong note...spending is up 12.0% against a pre-pandemic baseline; the four-week average is 11.4%, notable improvement from early May."
4. Consumer savings. "US consumer savings rate only 4.1%, below 9% LT average."
5. Truflation. "Truflation's real-time US inflation gauge has moved down to 2.4% from a peak of 12% last June."
6. Fed funds rate vs. CPI. "The Fed Funds Rate is now over 1% higher than the US inflation rate. The last time monetary policy was this tight with a Fed Funds Rate above 0% was back in October 2007."
7. Consumer sentiment. "Consumer sentiment printed at 63.9 in June [highest in 4 months] vs the est of 60.0, with both Current & Expectations components higher."
8. Inflation expectations. "1-year inflation expectations moved lower to 3.3% [lowest since March 2021] while 5-10-year expectations were unchanged at 3.0%.
9. NY services. The "business activity survey improved rising 11.6 to -5.2…with activity and climate rising while prices (paid and received) declined…wages also declined (-4.8 to 35.6) Employment rose (+3.6 to 8.6)...capital spending both current and 6 months forward however were down (declines of -12.5 and -6.6 resp.)."
10. Commodities vs. food. "Agricultural commodity prices are sharply moving higher again, suggesting that food prices are poised to follow suit."
11. Money market fund flows. "We saw the 1st outflow from cash in 8 weeks according to BofA."
12. Equity fund flows (I). "Equities experienced their strongest inflow since March 2022 this past week...+$25.62bn."
13. Equity fund flows (II). US equities recently saw their biggest inflow of the year.
14. Retail buying. "Retail investor purchases appear to have peaked for now."
15. Institutional investor sentiment. "About half of [~900] survey respondents describe themselves as bearish, with many saying they expect a recession in the U.S. this year."
16. Sector positioning. "Funds are most underweight Information Technology."
17. Growth vs. value. "HFs have kept buying Growth and (despite a brief pop in early June) have kept selling Value. Similarly, ETF flows into Growth and out of Value remain quite stretched on a 3-month basis as both Growth and Value have seen similar inflows MTD."
18. Everything else trade. "The GS cash desk is beginning to see long only demand for the 'everything else' trade … focused on +fins and +energy for now (note RSP had largest 1w inflow in its history at $1.1bn thru 6 jun)."
19. Options volume. "Almost 47 million options contracts on average have traded per day this month. At this pace, it'd be the highest volume month for the options market on record."
20. SPX calls. "There were over 1.8m SPX call options traded [on Thursday], an all-time high."
21. VIX open interest. Record SPX call options volume coincided with VIX call option open interest nearing its own all-time high.
22. Nasdaq breadth (I). "Breadth in the NASDAQ as measured by new highs vs new lows remains rather low."
See:
23. Nasdaq breadth (II). "NASDAQ has rallied relative to its 200-day moving average (blue), but only 3% of members are at a new 52-week high (orange)."
24. World breadth. "Bad breadth is not always associated with a bear market. .. On average, the market is up c5% 12m after a meaningful fall in breadth."
25. Leading industries. “Two of the three leading industries in US large caps have now reached new highs. This doesn’t happen in bear markets.”
26. Overbought NDQ. "Over 14-day period, relative strength index for NASDAQ 100 is most overbought since mid-2021."
27. Overbought SPX. "The S&P 500 has closed at 'extreme' overbought levels (2+ standard deviations above 50-DMA) for ten straight days now. Longest streak since April 2021."
28. Tech forward P/E. "Year/year change (in level terms, not %, orange) for S&P 500 Tech sector’s forward P/E has shot up to > 9, which is among largest gains in past two decades."
29. AI vs. EPS. And finally, based on an estimated 1.5% boost to productivity growth over the next 10 years, GS thinks CAGR "in EPS over the next 20 years would be 5.4%, compared with the 4.9% their dividend discount model currently assumes. That means the S&P 500 fair value would be about 9% higher than it is today."
Have a great weekend!