Daily Chartbook #35
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Welcome back to Daily Chartbook: macro market charts, data, and insights pulled from various sources around the Internet by a solo retail investor.
1. Food is still expensive. "Global food prices are down 14% from the peak".
2. Eurozone PMI. Eurozone productivity dropped to 46.6 in August for the sharpest contraction since June 2020.
3. ASEAN PMI. Meanwhile, manufacturing remains strong in Southeast Asia.
4. JPMorgan Global Composite PMI (I). The index fell to 49.3 in August as global activity contracted for the first time since June 2020.
5. JPMorgan Global Composite PMI (II). Manufacturing and services output both declined.
6. JPMorgan Global Compositve PMI (III). The Business Activity Index shows both business and consumer services in contraction.
7. Developed market output. "For the first time since early 2020, all four largest developed economies reported falling output."
8. ISM US Services (I). ISM Services PMI grew unexpectedly in August to 56.9. It was the strongest growth in 4 months.
9. ISM US Services (II). Business activity, new orders, employment, supplier deliveries, inventories, and prices
10. ISM US Services (III). Backlog of orders, new export orders, imports, and inventory sentiment
11. S&P Global US Services. S&P Global’s services business activity index, on the other hand, was revised lower to 43.7 in August (from 44.1). It was the sharpest contraction since May 2020
12. ISM vs S&P Global. A look at the divergence between the two indexes.
13. Soft landing? From Goldman: "The U.S. economy remains on a (narrow) path to a soft landing".
14. Intraday volatility. The S&P 500 experienced an intraday reversal on Friday greater than 2 percentage points to finish down. Previous such reversals have typically preceded further losses.
15. Expectations. “The current S&P 500 valuation suggests that equity investors should expect 4%/year over the next 10 years.”
16. S&P EPS estimates. Morgan Stanley expects earnings of $225 in 2022 and $236 in 2023, implying ~5% growth
17. Earnings outlook. "For Q3 2022, 62 S&P 500 companies have issued negative EPS guidance and 40 S&P 500 company has issued positive EPS guidance".
18. Midterm seasonality. Historically, the October before midterm elections is bullish for the S&P 500.
19. Valuations by sector. Sector forward P/E ratios compared to their 5- and 10-year averages.
20. Shrimps’ share. The share of Bitcoin held by smaller market participants has been growing.
21. Sentiment. Bearish sentiment has increased across assets.
22. Awful breadth. "The percentage of stocks trading above their 50 day moving average [green line] has collapsed".
23. Insider activity. "Corporate insiders jump out: in August, ratio of insider selling to buying rose to highest since February … 2,119 executives hit sell button, most since November 2021 on net basis".
24. Puts up (I). Put volumes have spiked for indexes, single stocks, and ETPs (exchange-traded products).
25. Puts up (II). "Institutions have loaded up on stock puts recently."
26. Relative safety. “Investors have added money to U.S. equity-focused stock and mutual funds for four of the past six weeks...while yanking money from international stock funds for 20 consecutive weeks. That’s the longest streak since a 22-week run of outflows that ended in October 2019.”
27. Passive ownership. And finally, passive investors are estimated to own 37.8% of stocks—or $16 trillion worth.
Daily Chartbook #35
I think passive investors are estimated to own 22.9% of stocks in 2021 if I'm reading that correctly.