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Daily Chartbook #312
Catch up on the day in 30 charts
Welcome back to Daily Chartbook: the day’s best charts & insights, curated.
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1. Financial conditions. Financial conditions are about as tight as they were 1 year ago.
2. Interest payments. "Non-mortgage interest as % of disposable income now highest since Feb 08."
3. Financing costs. "Financing Costs mentions on 3Q S&P 500 earnings calls soars."
4. Dallas Fed Manufacturing. The headline "index declined by 1.1 to -19.2 which was 3.2 worse than consensus. Real weakness in the prices paid sub-index (-11.4 to +13.6). All the major components were down."
5. Advisors vs. gold. "Despite the recent push toward new highs, gold remains severely under-allocated."
6. CTAs vs. gold. "While [CTAs are] still short gold, we expect them to [go] long if gold prices hold at current levels."
7. Crypto asset flows. "Digital asset investment products saw inflows of US$326m, the largest single week of inflows since July 2022...Bitcoin saw 90% of the inflows at US$296m."
8. Managed money vs. oil. "76mb drop in oil net managed money positioning to a 3-month low at percentile 20."
9. Risk sentiment. Risk sentiment across indicators has largely deteriorated in recent months.
10. Sentiment Indicator. Goldman's Sentiment Indicator dropped to 0 from 3 over the past week, indicating neutral equities positioning.
11. Global equity positioning. Aggregate positioning edged further into underweight territory driven by a sharp drop in systematic strategies.
12. Systematic strategies. Vol contol funds cut equity exposure sharply while CTAs went further short.
13. CTAs vs. US equities. "In the US, CTAs are short -$25bn of equities after selling -$20bn last week...[and] are now sellers of SPX in every scenario over the next week."
14. SPX spec positioning. "For first time since June 2022, large speculators’ net positioning in S&P 500 futures has edged up into positive territory."
15. Sector positioning (I). "Positioning in Energy turned overweight while positioning in all the other sectors we track is below long-term averages."
16. Sector positioning (II). "The extremely underweight sectors are Real Estate and Utilities."
17. Sector fund flows. "Energy ($2.4bn) received inflows for an eighth consecutive week and Technology ($2.0bn) also saw significant inflows."
18. HF trading flows (I). "US equities saw increased shorting activity for a 4th straight week (7 of the last 8)."
19. HF trading flows (II). "Consumer Discretionary was the most notionally net sold sector on the Prime book [last] week, driven by short-and-long sales."
20. HFs vs. Magnificent 7. "US mega cap tech stocks collectively saw the largest net selling since early Sep amid mixed Q3 earnings."
21. HFs vs. Discretionary. "Hedge funds re-shorted US Consumer Discretionary stocks following 3 straight weeks of net buying."
22. Sector dispersion. "There has been a large dispersion in S&P 500 sector performance since the October 2022 low."
23. Risk vs. Defense. "Even with the moves of the recent weeks, risk assets are still expensive vs history, and defensive assets are cheap."
24. Cyclicals vs. Defensives (I). Cyclicals are breaking down relative to Defensives but they aren't getting any cheaper.
25. Cyclicals vs. Defensives (II). In fact, relative to the S&P 500, Cyclicals are at their most expensive since the late aughts.
26. Recent corrections. "Here’s a look at the four 10%+ corrections we’ve had in the last two years. Just registered #4 last week."
27. EPS & sales revisions. Energy, Financials, Tech, Communications, and Real Estate have seen positive EPS revisions move the past month.
28. EPS guidance. "Our 1-mo. EPS guidance ratio improved to 0.8x (was 0.5x as of last week), in line with the historical average, somewhat alleviating concerns around weak guidance, especially that companies have no incentive to give aggressive guidance."
29. Profit warnings. "Profit warnings so far are concentrated in the Consumer Discretionary sector."
30. SPX margins. And finally, “margins are now back to their pre-pandemic peak.”
Thanks for reading!