Written by Gary
US main indexes rose solidly in relatively light trading today (SPY +0.9%) marking the end of the worst year for major U.S. indexes in a decade.
The Market in Perspective
|Here are the headlines moving the markets.|
Tesla has over 3,000 Model 3s left in U.S. inventory: Electrek
Tesla Inc had over 3,000 Model 3s left in inventory in the United States as of Sunday, automotive news website Electrek reported on Monday, citing people familiar with the matter.
Hertz Global to pay $16 million fine to settle accounting case: SEC
Hertz Global Holdings has agreed to pay a $16 million fine to settle a case over accounting misstatement, the U.S. Securities and Exchange Commission (SEC) said in an order filed on Monday.
Oil prices edge up, but set for first annual drop since 2015
Oil prices edged higher on Monday, the last day of 2018, but were en route for their first annual drop in three years as fears of a slowing global economy and emerging supply glut outweighed impending OPEC-led production cuts.
Trade optimism lifts stocks at end of tumultuous year
Equities around the world rose on Monday as possible progress in resolving the trade dispute between the United States and China engendered some investor optimism in what has been a punishing end of year for markets.
Fed Chair Powell’s unscripted approach sets up for rocky 2019
Jerome Powell had a bumpy first year as Federal Reserve chairman when it came to talking policy, by turns spooking and comforting investors even as economic data offered increasingly mixed signals and President Donald Trump stepped up his attacks on the U.S. central bank.
Wall Street limps to end of a tumultuous year on a positive note
Wall Street rose solidly in relatively light trading on Monday as revelers gathered to ring in 2019, marking the end of the worst year for major U.S. indexes in a decade.
‘Pooey Puitton’ purse said to irk Louis Vuitton, prompts lawsuit
A California toy company has sued Louis Vuitton to stop the French luxury goods maker from interfering with its sales of a slime-filled, poop-shaped toy purse for children, Pooey Puitton.
Trump says ‘big progress’ on possible China trade deal
U.S. President Donald Trump said on Twitter that he had a “long and very good call” with Chinese President Xi Jinping and that a possible trade deal between the United States and China was progressing well.
U.S. companies repatriate over half a trillion dollars in 2018, but pace slows
U.S. companies have sent home over half a trillion dollars of cash they held overseas in 2018 to take advantage of tax changes, but data suggest the pace is slowing, potentially removing a key source of support for Wall Street.
“They Said It Could Never Happen Again?” – Global Stocks Suffer Worst Year In A Decade
The world’s central banks’ safety harness finally gave way and one by one the world’s markets started to plunge.
Global stock markets lost almost $12 trillion in 2018 – the largest market cap loss since 2008 (and second largest in history)…
In fact, from its highs in January, world market cap is down $20 trillion.
As global central banks ‘allowed’ their balance sheets to contract on an annual basis for the first time ever…
2018 Greatest Hits: The Most Popular Articles Of The Past Year And A Look Ahead
One year ago, when looking at the 20 most popular stories of 2017, we admitted that perhaps as a result of too many conflicting narratives and outcomes, it was difficult to find a coherent theme of the key events that shook the world, and which you, our readers, found most interesting and notable.
2017 was a year of continued populist upheaval and political shocks, twists, turns and unexpected outcomes, a continuation of the “unexpected” Brexit vote outcome and Trump’s shocking presidential victory, both of which forced many to re-evaluate what “expert”, “pundit” and certainly “opinion poll” means; it was also the year when the concept of “fake news” became ubiquitously used by the establishment to slam any reporting it disagreed with and to justify why it was so wrong about everything, yet which would boomerang and lead to an even greater collapse in mainstream media credibility.
2017 was year in which class warfare in the US approached unprecedented levels with antagonism between races, genders, ethnicities, ideologies, age groups and incomes all approaching peak levels, and spilling over, literally, on the street as the US public was inundated with reports of ordinary citizens snapping and killing their peers in cold blood, of petulant students demanding conformity, and culminating with the deadliest mass shooting event in US history when a Vegas gunman killed 58 people and injured 851. His motives are still unknown.
2017 was a year of perplexing market stability: despite daily news of political, geopolitical and social turmoil, the market ignored virtually any potential risks and chugged along ever higher, with volatility crumbling to an all time low as the VIX printed a record number of days in the single digits
it was a year in which the S&P closed far higher than many had speculated, and defied the …
Here Are The “Costanza Trades” Of 2019
After a wild 2018, Mark Orsley – Head of Macro Strategy for Prism (and formerly with RBC), is out with a review of his 2018 “Costanza Trades,” while offering his comprehensive thoughts for next year.
It’s that time of year again. Stockings, dreidels, Festivus poles, and, of course, the inevitable truckload of bank “2019 Year Ahead” pieces cluttering your inboxes which are about as attractive as getting coal in your stockings. However, these pieces are useful in some regards, as they are very good at nailing the consensus themes and are excellent counter-indicators. Long time readers will know that The Macro Scan takes another twist at year end, to present next year’s top “Costanza Trades.”
For those of you not familiar with George Costanza, his character on the sitcom Seinfeld could do no right when it came to employment, dating, or life in general. In one episode, George realizes over lunch at the diner with Jerry that if every instinct he has is wrong, then doing the opposite must be right. George resolves to start doing the complete opposite of what he would do normally. He orders the opposite of his normal lunch, and he introduces himself to a beautiful woman that he normally would never have the nerve to talk to. “My name is George,” he says, “I’m unemployed, and I live with my parents.” To his surprise, she is impressed with his honesty and agrees to date him!
I find employing the Costanza method to trading an interesting exercise. Ask yourself this: what are the trades that make complete sense and all your instincts say are right? Now consider the opposite. Basically what you end up constructing is an out of consensus portfolio.
Employing the Costanza method can identify interesting, non-consensus trade ideas that could kick in alpha. Last year’s top 7 Costanza trades netted 5 of 7 WINNERS (some with huge gains), and past years have all been successful: 2017 had 5 o …
1Y-2Y Treasury Yield Curve Inverts Most Since Financial Crisis
With the 10Y Treasury yield, fittingly enough, sliding to the lowest level since January, closing Friday trading at 2.6842%, some 55 bps below where it traded less than two months ago when it peaked at 3.2373% on November 8, a more interesting move in TSYs has been observed in the short end where the 1 Year (or 52 Week Bill) closed at 2.590%, up 1.81bps, while the 2Y yield, seen by many as the bond market’s estimation of what the Fed will do in 2019, has continued to slide, and on Friday closed 2.8bps lower at 2.4878%, the lowest since the start of June.
As a result, the 1s2s curve has inverted to a whopping -10.8bps.
What the reason is for this bizarre divergence in preference for 2Y paper over 1Y we are not sure, however we will point out that the last time the 1s2s traded almost this negative, when it touched -10.2bps, was in October 2008, just after the government announced it had bailed out AIG.
January 2019 Economic Forecast Index Significantly Slows
Written by Steven Hansen
We stated last month, “With the mixed economic picture and stock market turmoil one might expect our forecast to significantly degrade” – yet our economic forecast was little changed. This month the Econintersect Economic Index (EEI) significantly declined, and is now below territory associated with normal expansions. This is a departure from the previous three months where the index’s growth rate was little changed.
Futures Movers: U.S. oil ekes out a gain as futures close out declines for month, quarter and year
Oil futures on Monday manage a slight gain in the final trading day of a volatile 2018 that finds energy benchmarks down sharply from their highs of the year.
Here’s a list of the 80 new store closures Sears has announced
Sears Holding Corp., which has filed for bankruptcy, has announced it will shutter 80 more Kmart and Sears locations.
The New York Post: Netflix’s Reed Hastings and Ted Sarandos to get $31.5 million in compensation in 2019
CEO and chief content officer will enjoy some generous pay packages in the new year.
Summary of Economic Releases this Week
Earnings Summary for Today
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