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Daily Chartbook #228
Catch up on the day in 30 charts
Welcome back to Daily Chartbook: the day’s best charts & insights, curated.
Administrative note: DC will not be published on Monday or Tuesday, July 3-4.
1. Pending home sales. Pending home sales in May fell 2.7% (vs. -0.5% expected) for the third straight monthly decline.
2. New listings. "New listings of homes for sale fell 26.5% year over year, the biggest decline since May 2020. "
3. Active listings. "Active listings...dropped 11% from a year earlier, the biggest drop since April 2022. Active listings were essentially flat from a month earlier; typically, they post month-over-month increases at this time of year."
4. Median sales price. "The median home sale price was $382,628, down 0.9% from a year earlier, the smallest decline in nearly four months. Price declines have been shrinking for the last two months."
5. Jobless claims. "Jobless claims back to defying the Fed, as they drop 25k to 239k or 26k below estimates - thats 18.5k below the 4 week moving average. Continuing claims were down 19k to 1,742k which was 23k below estimates."
6. Q1 GDP final. "Q1 GDP was revised meaningfully higher to 2.0% vs the prior est of 1.3%, mostly due to consumer spending & net exports revisions."
7. Real consumer spending. "Personal consumption rose by 4.2%, revised up from 3.8%, led by spending on goods."
8. Card spending. "Total card spending per HH was-2.0% y/y in the week ending Jun 24...Total card spending ex gas fell to-0.1% y/y in the week ending Jun 24, while retail spending ex auto was even lower at-4.2%."
9. Financial conditions vs. lending standards. "Financial conditions may be more restrictive than high-frequency indicators suggest as banks tighten lending standards."
10. Credit conditions vs. labor differential. "Tighter credit conditions typically precede labor market weakness."
11. Bankruptcies vs. credit spreads. "Idling credit spreads are increasingly unreflective of underlying credit conditions, leaving them exposed to a significant widening."
12. Inventories. "Mentions of 'destocking' on corporate earnings calls have soared."
13. Deal volumes. M&A and IPO "deal volumes are down 42% year-on-year at $1.3 trillion."
14. Macro factors. "In Q3 we are uncertain about risk appetite, and we have reasonable confidence for the direction of the other three factors."
15. USD vs. Fed, recessions. "The USD consistently outperformed the rest of G10...in the months preceding the peak of the respective tightening cycles...the USD held up well on average during the first three months of the last six US recessions since 1980."
16. Commodities vs. stocks. "When commodities (represented by the Bloomberg spot commodities index) are flat for a long period, stocks rally...So good news for raw materials is by implication bad news for stocks."
17. Stocks vs. bonds. "The correlation between bonds & stocks has kept falling. Current 90 day correlation -0.32, 10 yr. average -0.20, recent high to end 2022 +0.53."
18. US02Y vs. SPX. "When rates are in an uptrend, equity valuations decline. When rates stabilize or drop modestly, stocks rally…because equity markets rightly worry that aggressive monetary policy can cause a recession and therefore cause lower corporate earnings"
19. US01Y vs. SPX. "1Yr Yield is now higher than S&P 500 earnings yield. Hasn't been like this since late 2000..."
20. AAII sentiment. "June had more weeks of bulls > bears than the preceding 18 months combined. But stocks have struggled in the past with bulls in the 40s and bears in the 20's."
21. Active managers. The NAAIM Exposure Index fell to 75.9 from 83.6.
22. Hedge funds vs. mega-cap tech. "Mega-cap tech has become its largest share of hedge fund long portfolios since early 2020."
23. Hedge funds vs. staples. "GS PB data show consumer staples exposure trending higher in 2023."
24. Short covering. "CFT positioning data continues to show an unwinding of short positions in the S&P 500 E-Mini following the break above key technical resistance...with this still well below neutral this suggests we can continue to see a further short-covering rally."
25. Zombie debt. "Debt for zombie companies is mostly concentrated in three sectors (Tech, Energy, Consumer Staples) ... Basic Materials' and Financials' representation remains small, despite having grown over past few years."
26. Zombie performance. "Earlier this year, zombie companies had doubled S&P 500's gain, but outperformance has completely faded with broader market now doing much better."
27. Small- vs. large-caps. "Small Cap stocks are trading at their biggest discount to Large Cap stocks in over 20 years. The only larger valuation gap over the past 50 years was during the Dot Com Bust."
28. Fed rate vs. bear markets. "A fact that makes this stock rally feel awkward. Six out of the last seven bull markets have started when the Fed has cut rates. And the Fed keeps telling us that cuts aren't coming any time soon."
29. SPX seasonality. "Historically, July tends to be a positive month for the S&P 500 in the third year of the US presidential cycle."
30. Second half returns. And finally, “when first half gains were 10% or higher, the index posted average gains of 7.7% in the second half, with 82% of occurrences producing positive results.”
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