Tuesday, 6 October 2015

A few macro and related thoughts today...

A few macro and related thoughts today...

Markets - the S&P 500 gained 1.8 per cent and rose for a fifth straight session, the longest winning streak since a five-day run to December 23 last year. For the most recent six-session streak, you have to go back to June 20, 2014 (via Fast FT)  Out of the previous 888 5-day win streaks, the $SPX avg a gain of 2.93%.  This one gained 5.59% (h/t @RyanDetrick).  Junk bond ETF $HYG had its best day of the year today (+1.2%).

The Chicago Board Options volatility index slid and closed below its long-term average on Monday for the first time in more than six weeks.  The Vix index, which measures the expected moves in the S&P 500 over the coming month, declined 7.8 per cent to 19.30. The index last closed below 20 — its average level since 1990 — in late August (via Fast FT):


Certainly an excitable last few days.  The bounceback scope was pretty clear...but now we start to move into what is likely to be the greater differentiation of the earnings season (at least this is what I hope/anticipate).

 

China – best primary/secondary/tertiary chart I have seen:


(h/t @sobata416)

Meanwhile a nice emerging market risk chart –


Greece - Greece unveiled a budget draft for 2016 predicting the economy will shrink by 1.3 per cent on top of a projected 2.3 per cent decline this year. Forecast a primary budget surplus - before repayments of debt and interest - of 0.5 per cent of GDP following a deficit of 0.24 per cent this year. Greek PM Tsipras says aims to restore liquidity and access capital markets within the next 20 months (Rtrs)

Value vs growth - Using indexes of "pure value" and "pure growth" stocks in the S&P 500, the difficulty for value-oriented investors is easy to see this year. The pure growth stocks have returned more than 1 percent including dividends, outperforming value stocks by 9 percentage points (link here). 


This due to big underperformance of sectors like energy, so interesting it came out on day when S&P Energy sector back above its 50-DMA for the first time since 5/22, breaking a streak of 92 trading days below...

(via Bespoke Invest)

TPP trade deal: seven things you need to know (link here). 

And finally…the important question:

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