DC Lite #364

In partnership with

1. Container freight costs. "The Drewry Global Container Freight Index jumped 7.6% this week to USD 2,233 per 40ft box—a five-week high—led by significant 15.6% and 19.3% increases on the Shanghai to Los Angeles and New York routes … as exporters and importers alike in China and the US take advantage of the 90-day truce period."

2. Capex plans. "Capital spending intentions moving in opposite directions in the regional surveys. There might be a timing issue here. The Philly Fed survey responses are collected from May 5 to May 12 and may include purchasing managers that responded as weekend talks with the Chinese progressed. By contrast, most of the survey respondents for the New York Empire are collected before the 10th of the month."

3. Vol control positioning. "Vol control strategies will add length. And they definitely have the room for it. Our model estimates that vol control positioning is~40% below the 2yr average."

4. AI valuation. "The P/E premium vs the overall market for a basket of 48 AI-related stocks is back down at levels last seen in 2017."

5. SPX Semis earnings. "The forward earnings of the S&P 500 Semiconductors industry has been rising to new record highs since the start of this year. That confirms our confidence in the industry."

ICYMI