ANGLES.

The calendar may have flipped, but the song remains the same. Last week was something of a microcosm of 2022; a steady downward grind for the most part, occasionally punctuated by a sharp spike. Last year these spikes all failed to trigger a true turnaround, always eventually fizzling out and leading to subsequent further new lows. It remains to be seen if that pattern will continue or benefit fro...

To reiterate what I said last week, the absolutely key question when it comes to financial markets in 2023 is: Will inflation fall faster than economic growth and earnings? Mark your calendars for when we will get the next hints at an answer .. * Thursday, January 12th when the US Consumer Price Index (CPI) measure of retail inflation is released. Why It’s Important: The key for the next CPI repor...

The much-anticipated Santa Claus Rally window came and went last week with only more volatility and a lot of lower prices to show for it. With hardly any discernable meaningful catalysts and a lot of end of year tax-loss selling going on, there simply wasn’t much to stop stocks from rolling over early in the week. Wednesday (good) and Thursday (bad) basically cancelled each other out. Friday was a...

The Transition from the primary market driver no longer being the expectations of what Fed interest rate policy will be and instead turning to tangible, evidence-based economic growth and inflation levels officially began last week with stocks trading on the back of growth and inflation perceptions rather than just reacting to Fed rhetoric like obedient lemmings. That’s something that will likely...

Over the past few weeks, the macro environment has generally become “less bad” and that does justify some kind of a rally, but it’s important not to confuse “less bad” conditions with actual “good” ones. It’s also important not to mis-interpret year-end seasonal factors and positioning, combined with a sudden burst of optimism, with the implication that this has sown the seeds for a sustainable ra...

Watching a grandfatherly, white-haired 69 year old man doing performative dance doesn’t sound like something hot-shot Wall Street traders and stock market professionals would choose to spend their time doing, but they very much are and that somewhat elderly gentleman is by far the the most important influence right now on the immediate trajectory of your net worth. We are talking, of course, about...

It was a quiet week, so let’s take the opportunity to zoom out a bit, look at the bigger picture and see where we stand in the ongoing saga of this bear market .. There wasn’t too much to take from a choppy, vacation-shortened week with increasingly thin attendance and extremely low volume (see EXPLAINER: FINANCIAL TERM OF THE WEEK as well as UNDER THE HOOD below) ahead of and right after the Than...

Apologies once again for last week’s report, or the lack of it. I am safely back in the US now and very much recovered. Thanks for all the good wishes that I received, they are very much appreciated. Towering over last week’s market activity was the extraordinary and shocking fraudulent collapse of the FTX crypto exchange. For many, this was a watershed moment where the whole crypto eco-system was...

In a horror movie, it often happens that the poor young person being chased in the house gets right to the front door and is just about to escape onto the street when the killer suddenly jumps out and grabs them. As an audience, we are teased with the prospect of good news when, suddenly, that hope is snatched away. That’s pretty much what happened in the stock market last week, specifically with...

There was such a torrent of market intel to try to absorb last week that it was hard to keep up at times. It also meant that leads got buried all over the place as news and data points that would usually be the focus of market attention for a matter of days were eclipsed within hours or even minutes by yet another surprising earnings report, economic data release, geopolitical development, global...

A Wall Street Journal report on Friday by Nick “The Fed Whisperer” Timiraos reported that, while the early November Fed meeting will still most likely result in another 0.75% increase in interest rates, it could well be the final one that showcases a hike of that magnitude and that committee members are now actively contemplating easing up in December and beyond. Interestingly, on the same day, Sa...

The market spent the first three days of last week just shifting about in a bumpy, lethargic, generally downward-trending trading pattern, simply waiting it out for the main event in the form of the Consumer Price Index (CPI) inflation number release due on Thursday morning. There was certainly no sign that the buyers from the week before were looking to capitalize on their brief success and take...

Bad news is often good news for investors these days, who have to perform mental gymnastics as the economic picture comes into focus. Traditionally negative indicators of a weaker economy such as rising unemployment or falling consumer spending tend to result in lower inflation, which likely means the Fed can take its foot off the gas with monetary tightening, which should mean less pressure to ra...

KEEP AN EYE OUT FOR THE MY INAUGURAL QUARTERLY MARKET REVIEW WHICH I WILL BE SENDING TO ALL SUBSCRIBERS IN THE NEXT DAY OR TWO, TAKING A DEEP DIVE AND LOOKING BACK OVER AN EVENTFUL (TO PUT IT MILDLY!) Q3 2022. Dearly beloved, we are gathered here today to mourn the demise and end of the summer stock market rally which finally expired last week, as the entire set of gains since the June 16th prior...

For years, corporate America and stock market investors could rely on the Federal Reserve to have their back. Ridiculously low borrowing costs turbo-charged stock prices - especially those of profitless (and sometimes mindless) tech companies. The Fed’s interests were aligned with those of the likes of Apple, Tesla and Microsoft but also with those of regular people pouring money in their 401k eve...

Monday was mostly just about positioning going into the next day’s inflation print (although the surprisingly effective counter-attack by Ukrainian forces also came into play somewhat). A narrative slowly built throughout the day that maybe future inflation might not be as elevated or persistent as was previously feared and that we might expect to see an appetizing Consumer Price Index (CPI) numbe...

A holiday-shortened week began uneventfully with little of interest coming over the newswires and markets simply drifted along the path of least resistance, which is currently downwards. Things soon began to pick up steam to the downside though, as the Chinese city of Chengdu extended COVID lockdowns for the majority of its 21 million residents due to rising infection numbers, dimming the demand o...

How quickly that half-full glass I talked about last week has emptied. A third consecutive week of stock market losses ended with a thousand point fall in the Dow Jones Industrial Average on Friday as Federal Reserve chair Jerome Powell, talking at the Fed’s annual jamboree in Jackson Hole, Wyoming, ferociously doubled down on the central bank’s commitment to raise interest rates as aggressively a...

The market appears to have decided that the glass is half full, for the moment at least. Last week’s stock price declines, mostly concentrated on Friday, can essentially be put down to the seriously overbought conditions brought about by four straight weeks of gains and two months of solid progress. There wasn’t a whole lot else behind the price slump. Yes, perhaps economic data out of both New Yo...

While the FBI searching Trump’s home at Mar-a-Lago and its aftermath might have been the biggest deal in the civilian media last week, it was a complete non-event as far as the financial markets were concerned. There was only ever going to be one story last week. Well, maybe one and a half. Data released on Wednesday showed that the Consumer Price Index (CPI) measure of retail inflation was unchan...

Markets basically just churned last week in advance of Friday’s release of the latest jobs data, with the S&P 500 closing on Thursday afternoon just a touch higher than it started the week on Monday morning. Pelosi’s Taiwan visit and China’s entirely predictable reaction only briefly raised pulses but markets basically ignored it. Nothing to see here. Silly geopolitical stunts are not driving mark...

(Slightly longer report than usual this time around, but last week was a doozy) Last week’s big story was always supposed to be the Fed’s interest rate hike on Wednesday but in the end, that proved to be rather uneventful and lacked any kind of a wow moment. The surprise-averse stock market absolutely loved that. But what really generated a huge amount of heat but precious little light was the oft...

Markets seem to have firmly seized onto the hope that we are now close to 1) peak inflation, 2) peak Fed hawkishness and, as a result of the first two, 3) peak US dollar strength. The result was a very solid week for most stocks (with the occasional notable exception, like SNAP which collapsed nearly 40% on Friday alone after terrible sales growth numbers). But hope combined with some favorable re...

Get ready for an avalanche of recession warnings across all media platforms. That's the conclusion from last week’s Consumer Price Index (CPI) report , as inflation hit yet another 40 year high which almost guarantees that the Fed announces on July 27th that it will raise interest rates by at least another 0.75%, putting even more pressure on the economy. Indeed, after the Bank of Canada last week...

The stock market’s recession/inflation concern pendulum swung back towards recession last week as investors focused on what a recession may look like and how a benign one actually might not prove to be too bad. One narrative doing the rounds last week was that if the oil price continued to come down (and maybe bring inflation down with it), the US economy might still enter a recession, but it coul...