Daily Chartbook #63
Discover more from Daily Chartbook
Welcome back to Daily Chartbook: macro market charts, data, and insights pulled from various sources around the Internet by a solo retail investor.
1. Global oil inventories. "Total global inventories (crude+products) built by 3.1 mln bbls WoW -still well below the five-year average".
2. Goldman bullish oil. "The GS commodity team expects WTI to average $105/bbl over the NTM, above the forward curve which is at $80/bbl".
3. Oil supply deficit. "For 2023, we see a material supply deficit of 0.8MMbls/d which leaves us more positive on oil, even accounting for the fact we have revised down global oil demand".
4. Financial conditions & inflation. "Financial conditions have become tighter, but it looks we need them to become even tighter in order to tame inflation..".
5. CPI vs forecasts. "In the last 19 months, the headline CPI has surprised month-ahead consensus forecasts to the upside 12 times and to the downside just twice".
6. Strong wages. Wage growth is still strong at both the top and bottom of the earning spectrum, though the latter's "upward trajectory was interrupted in September".
7. Retail sales (I). Retail sales in September were unchanged (vs. +0.2% expected) bringing YoY sales to +8.2% (nominally).
8. Retail sales (II). Sales rose more than expected excluding autos (+0.1% vs -0.1% expected) and excluding autos & gas (+0.3% vs. +0.2% expected) while core sales rose 6.6% YoY.
9. Retail sales (III). After adjusting for inflation, real retail sales have fallen for 4 out of the last 5 months.
10. Retail sales (IV). "Real retail sales being negative YoY for more than a couple of months has for the past 75 years been an excellent coincident to short leading indicator for an oncoming recession".
11. Consumer sentiment ticks up. The University of Michigan consumer sentiment rose from 58.6 to 59.8 in October, the highest in 6 months.
12. Inflation expectations curl up. "US 1y inflation views rise for 1st time since Mar to 5.1% in Oct from 4.7% in Sep. US consumers see costs rising at an annual rate of 2.9% over next 5-10yrs, a pickup from 2.7% in Sep."
13. US economic data is top of mind. Institutional investors are largely focused on economic data.
14. Asset manager concerns. "It's interesting that smaller managers are far more worried about a recession than their larger counterparts".
15. S&P 500 vs. ISM. "We’re currently more than 10% below where the ISM suggests we should be. .. That might help explain some of the astonishing 5.5% rebound from the lows yesterday after yet another poor CPI".
16. Options volume (I). "Ahead of CPI there was a massive rush into ETF calls, largely in index ETFs. Just like before May's print".
17. Options volume (II). Stocks have generally bounced after similar spikes in options volume.
18. Short everything. "According to the CoT data, the net short in US equities and Treasuries is as large as it has been going back to 2004".
19. ERP. "Historical downturns have resulted in a much sharper increase in the Equity Risk Premium vs. now".
20. The wrong kind of streak. "NASDAQ has traded below its 200d moving average for 187 days, longest streak since 2003".
21. Seasonality. “The ‘seasonally favorable period’ begins. SPY up 24 of 28 years between now and end of year. BUT the losers include other overall weak years 1994 (-1.1%), 2000 (-4.4%), 2007 (-5.5%)and 2018 (-9.7%), so NO sure things!”.
22. Real YoY returns. "Inflation-adjusted annual returns for S&P 500, Russell 2000, and NASDAQ hovering near GFC levels".
23. 60/40 portfolio (I). The "YTD annualized return for the 60/40 portfolio is the worst in 100 years".
24. 60/40 portfolio (II). However, "following the other two drops below -20%, the 60/40 portfolio then evidenced strong gains for the next two years".
25. Q3 earnings update (I). Of the 7% of S&P companies that have reported earnings "69% have reported actual EPS above estimates, which is below the 5-year average of 77%"…
26. Q3 earnings update (II). …and 67% "reported actual revenues above estimates, which is below the 5-year average of 69%".
27. Q3 earnings update (III). The blended earnings growth rate for Q3 is 1.6%, compared to 2.2% last week and 2.8% at Q2 end.
28. Q3 earnings update (IV). And finally, the blended revenue growth rate for Q3 is 8.5%, which is unchanged from last week but down from 8.7% at Q2 end.
Have a great weekend!