Traders Market Weekly: Naive Markets and The Fed Fortune Tellers

September 24 – 30, 2023

FEAR NOT Brave Investors

Where have we been and where are we going? Join our weekly market thread on Traders Community…

Read my Fortune

The Week That Was – What Lies Ahead?

Contents

Click on the links below to navigate to the relevant section.

Editorial

The market got all one way and glimmer hope, ignoring the reality of what bond and markets were saying and we are. The aftermath of the Fed’s higher for longer and their totally innocuous dot plots racked the markets as we saw in yields hitting multi year highs here and abroad. Why was this a surprise, sorry we all know the answer in the dribbler’s lament. The higher for longer mantra is dominating risk-off sentiment but what is new?

Why are the paying heed to the dot plots? The Bank of England held also and also opted for higher for longer, increases QT pace, The Swiss also held with a tightening bias. Riksbank and Norges Bank hiked, guided more to come. BI, BSP, CBCT, SARB and BOJ all held. Then there is the basket cases, of basket cases, Turkey hiked 500bps and the lira still fell again.

What’s confusing the Fed? The usual, jobs and earnings. Not surprising when the political elite are so disconnected then the half of a America that works and pays taxes. US initial jobless claims dropped to the lowest since January and the UAW is striking against the three largest car companies wanting a 40% wage hike with lower hours. They are shocked by rising energy prices, really have you paid attention to what OPEC+ is doing and the US Administration response? Should we mention that the majority of PMI reports are in contraction and were weaker?

Back to the dot plots and we were suggesting don’t being naive to the Fed’s dot plots being more than that of a failed palm reader. That said we know the herd mentality in this market the past eighteen months, so that psychology reacting to that, enough said.

To quote those good people at Scotiabank:

Most of us know better than to assign much importance to the FOMC’s randomly scribbled dots that depicted a higher for longer bias toward the policy rate including reducing projected easing next year to 50bps from twice that previously. The evidence is clear in that the dots outside of the current year tend to perform poorly as guides to what actually happens to the Fed’s main policy tool. This is backed by charts 1 – 4 that track what actually happens to the fed funds policy rate relative to what the dots predicted in each of the current year, one-year out, two-years out and three-years ahead. Yet markets chose to chase the dots in driving Treasury curve steepener trades.

If markets are reacting to the higher for longer guidance that cut in half the magnitude of cuts next year, then that’s where the rub lies in my view. The dots are largely useless beyond the near term and have at best a soft track record in terms of lining up with what actually happens to the policy rate (chart 1). The dots are one part what the Committee members think may happen and one part dirtied by efforts to control markets through an extension of the Fed’s long history of seeking to manipulate them. The FOMC doesn’t wish to have anyone piling into rate cut pricing just yet and is not yet prepared to ring the all clear on a final hike. That day will come, but not yet.

However, the initiation of the autoworkers’ strike after contract negotiations between the United Auto Workers (UAW) and the three largest U.S. automakers fell through is a huge headwind rattling investor and the economy. This a significant risk but one that has seemingly missed by most. The U.S. lost 4.1 million days in August, before the UAW strike. The highest in over twenty years.

Global central banks are facing pressure after a protracted period of policy tightening and amid uncertainty over their next steps. Oil continued its rise further hampers their future path. More geopolitical influences, Saudi Arabia and Russia are planning to extend their voluntary oil production cuts of 1 million barrels per day and 300,000 barrels per day, respectively, through the end of 2023.

Global bond market liquidity appears increasingly under the grips of deleveraging.

U.S. Treasuries ended Friday with gains across the curve, reclaiming some of their losses after the FOMC reinforced the higher for longer mantra. 10-year Treasury bonds hit 4.48%, a new 15 year high intraweek. 30-Year conventional mortgage at 7.49% a new 23 year high intraweek. Credit spread 1.72%, down -.04% w/w (1.72-2.42) (new 1 year low).

The distortion and shameless political theater from all sides has mishappen reality and that irrationality has poisoned decision making for many. Remember in bonds, commodities and forex the rubber always meets the road. That is what matters and that is what is running the distorted equity markets, as they say pick your poison and pick it wisely.

e finished the week with the release of flash Manufacturing and Services PMI readings from major economies. Most of these readings showed ongoing contractions in both categories, with rare exceptions like Services readings from Australia (50.5), Japan (53.3), and the U.S. (50.2).

  • 10-year Treasury bonds hit 4.48%, a new 15 year high intraweek.
  • 30-Year conventional mortgage at 7.49% a new 23 year high intraweek.
  • Credit spread 1.72%, down -.04% w/w (1.72-2.42) (new 1 year low).
  • Benchmark MBS yields traded as high as 6.33% intraday Wednesday, matching the high back to July 2007 before closing the week 12 bps higher at 6.17%.
  • Surging yields were not limited to Treasury and agency securities. Sovereign yields hit at least decade highs this week in countries including Canada, Germany, France, Spain, Sweden, Belgium, Austria, Netherlands, Australia, New Zealand, and Japan.

Even with today’s rally yields finished at fresh weekly highs for the year and expanded the 2s10s spread by four basis points to -68 bps. Crude oil extended its bounce off a ten-day low, returning to little changed for the week, while the U.S. Dollar Index rose 0.2% to 105.61, gaining 0.3% for the week.

Treasuries Friday rally came after the release of the U.S. flash PMI readings with 5s and longer tenors holding the bulk of their gains into the close while the 2-yr note backed off its morning high, but still recorded a solid gain. The market saw no meaningful shift in rate hike expectations even though Fed Governor Bowman (FOMC voter) said that she thinks that additional rate hikes will be appropriate while Boston Fed President (non-voter) Collins also said that additional tightening is still on the table. San Francisco Fed President Daly echoed the sentiment, though she is not an FOMC voter this year, but will be on next year’s Committee.

A few of the higher risk headlines for prices:

  • UAW Strike News of the UAW continuing and intensifying strike actions against the Big Three automakers pressures markets. Global market “risk off” continues to gather momentum.
  • Margin Calls

This Week’s Main Stories We Covered

September Mornings or Warnings?

Now that we heard from Fed Chair Powell at the Kansas City Fed’s Jackson Hole Symposium, the focus shifts back to the data and how bankers interpret it.

The September effect on risk appetite is a real thing, history suggests. That said we live in such manufactured times market wise, socially wise and sentiment wise we won’t put it all on that affect but is in the back of our minds.

Monthly returns on the S&P500 since 1928 lean towards September being the worst month for stocks on average at least for passive investing. In Septembers since 1945, the S&P 500 has declined an average of 0.7%, the worst performance of any month, according to CFRA.

Looking ahead for September there are a number of catalysts. We have had the jobs report and PCE. Next consumer price data due on Sep. 13 then the Fed’s monetary policy meeting Sep. 20. The Jackson Hole speech from Fed Chairman Powell fueled expectations of another rate increase this year, though a move in September was seen as less likely.

Outside the U.S. we had heightened financial stress and weak markets in China as we had been the pattern all year despite the constant dribbler and talking heads calling for a China turn around.

Risks Being Ignored or Opportunity Being Repriced?

With the swings of psychology and dominance of unemotional algorithm models dominating markets more than ever it is critical to stay unemotional and devoid of bias where best you can. For the next six months, we stick to our technical outlook via KnovaWave, watch the curve and EURUSD and USDJPY.

A reminder in these markets don’t get married to a view, leave biased partisan opinions at the door and find a leader. Right now, NVDA and TSLA continue to give us give good insights into crowd behavior. Note the divergence and convergence with it and other instruments. Be proactive.

These markets are constantly evolving, the important things is why we are here and it isn’t a surprise.

Where is the fear?

We got some movement these past weeks out of the tight range in markets but as we can see from the VIX chart it quickly reverted back after the initial breaks. We are aware of built-up energy ahead of key central bank decisions and potential fundamentals to set-up rate hikes or not. There is discontent globally with central banks and politician.

With optionality dominating markets along with quant funds, algorithms, systematic trading and automated trading volatility has collapsed as has been focused on at KnovaWave. Driving quant funds is a self-reinforcing dynamic, when market volatility drops, they add which causes those funds that have paid higher volatility to cover and hence we get the churn. At the end of March, quant-focused hedge funds held about $1.13 trillion in assets, according to research firm HFR, hovering just below last year’s record high. That represents about 29% of all hedge-fund assets.

To break out of this requires a continuing break in a major down, or up move to ignite delta chasing or covering.

So-called vol-control and risk-parity funds, which tend to automatically load up on riskier assets during calmer periods, ramped up equity exposure, according to the Deutsche Bank data, available through May 18. Other quants, such as trend-following CTAs, or commodity trading advisers, have similarly piled in.

The dominance of quants has helped explain previous periods of calm trading, including long stretches in 2017 and 2018. Those periods were punctured by rapid selloffs, including the 2018 selloff dubbed “Volmageddon” when the dynamics exerting calm on the market suddenly went away. Some warn a repeat could be ahead.

Caitlin McCabe WSJ

Cboe Daily Market Statistics

Cboe Daily Market Statistics

Talking about manic behavior it is not hard to argue the punter is overwhelming and influencing markets like no other time, well until the next time. Swirling greed and know it all came home to roost. FOMO (fear of missing out) and TINA (there is no alternative) ended how they always do.

When the VIX is highly reactive, VIX related products can serve as potentially effective hedging tools, when the VIX is not very reactive, traditional hedging techniques may be a better choice.

The VOLX`s underlying instrument is the Mini VIX™ Future. The CBOE Volatility Index (VIX) is an up-to-the-minute market estimate of expected volatility. The VIX is calculated using a formula to derive expected volatility by averaging the weighted prices of out-of-the-money puts and calls (options) on the S&P 500.

Worth repeating again in the low VIX environment.

Well, 2008 redux didn’t happen in the last few months, so the Fed moves have worked for now, much to Xi and Putin’s chagrin.

The doomsayers may be right, but we are seeing constant surprises to that theory. For example, early signs that the US housing market slump is finding a base are emerging, pending home sales having risen for a third month and to a 6-month high. we will keep an eye on consumer sentiment and business activity. We are far from being out of the woods, remember the market is not the economy. Saying that we got quite the distorted job picture per our main job stories which we reprise below. Are we simply taking some air out or is the beginning of the great meltdown?

What we continue to notice is how this market is still being treated by ‘experts’ as those in the past, hence the volatility and extreme in bulls/bears. Understanding crowd behavior is essential in these markets. The moves have caught analysts and strategists by surprise with the uber bear running amok in the past few weeks. Typical thinking is this from Morgan Stanley strategists a month ago; “Given the events of the past few weeks, we think … equity markets are at greater risk of pricing in much lower estimates”, noting that earnings estimates were 15-20% too high even “before the recent banking events.”

What non-traders are failing to grasp is this market with so many variables is not trading as they expect and they are constantly wrong. S&P 500 earnings for the first quarter are estimated to have fallen 5% from 2022, followed by an expected 3.9% drop in the second quarter, Refinitiv data shows. During recessions, however, earnings tumble at a 24% annual rate on average, according to Ned Davis Research. However how important is that in such a chaotic market? There is the answer structure your thinking around game theory or even chaos theory.


Week Ahead: Core PCE, Eurozone CPI

Eyes will be on top macroeconomic reports that will emphasize the health of the US and global economies. Eyes and ears will be on central bankers given the market turmoil and the hiking of rates.

This week, there will be four main global economic indicators and all of them arrive on Friday that will be telling. There are other data points but we feel these are what matters, outside of the bond market behavior through the week.

  • US Core PCE Inflation – The Federal Reserve’s preferred inflation reading for August will be released on Friday. Core PCE inflation could come in a little lighter than the already known 0.3% m/m SA rise in core CPI inflation for the same month. PCE can tend to track beneath CPI for both headline and core gauges
  • Eurozone Inflation—Buoyed by Energy, September’s CPI inflation could be factored in given the ECB’s mixed messages that has markets pricing no further hikes.
  • Canada’s GDP for July and preliminary guidance for August will be provided by Statistics Canada on Friday.
  • China PMI updates the state’s version of purchasing managers’ indices on Friday night. “An erratic release schedule sometimes sees the data coming out when more people are paying attention and sometimes on the weekends when fewer may be doing so.”

Earnings season has almost ended, but there are still companies reporting this week with earnings from

How Hot is the American Economy?

More Macro and Micro data points, some highlights include.

  • Monday:
  • Tuesday: July FHFA Housing Price Index, July S&P Case-Shiller Home Price Index; August New Home Sales, September Consumer Confidence
  • Wednesday: Weekly MBA Mortgage, August Durable Orders, Weekly oil inventories.
  • Thursday: Q2 GDP – third estimate, Weekly Initial and Continuing jobless claims; August Pending Home Sales, Weekly natural gas inventories,
  • Friday: August Personal Income, Personal Spending, PCE Prices, Core PCE Prices, advance goods trade balance, advance Retail Inventories, advance Wholesale Inventories; September Chicago PMI; final September University of Michigan Consumer Sentiment

How is the Consumer Hanging?

The US relies on services for up to 90% of GDP. it relies on the consumer who is being battered by the California and New York regional bank debacle. On top of that is cumbersome if not ignorant politicians, with no clear regard for main street the evidence suggests in their behavior. Key retailers all gave a cautionary note with tightened household budgets continue to hit demand for big-ticket items and curb discretionary spending.

We get more data to help us gage the consumer: Weekly MBA Mortgage, Weekly Initial and Continuing jobless claims, September NAHB Housing Market Index; August Housing Starts and Building Permits; FOMC Rate Decision and Summary of Economic Projections; August Existing Home Sales; August Leading Indicators; S&P Global US Services PMI – Prelim

Earnings season has almost ended, but there are still companies reporting this week with earnings from FedEx (FDX), Darden Restaurants (DRI), AutoZone (AZO), and General Mills (GIS).

Click here to see the Full Week Ahead List Below

Some things never change, when you think Greed is Good

So how Screwed are We?

  • Fed Z.1 for June with the release of Q2 Credit and flow data shows seasonally adjusted and annualized Credit growth of about $4.5 TN. One-year Treasury debt expansion of about $1.7 TN. Non-Financial Debt-to-GDP exceeding previous cycle peak levels. The ratio of Total Debt Securities-to-GDP is significantly higher than prior peaks.
  • Household holdings of Financial Assets above previous peak levels. Household Net Worth inflating $5.5 TN in three months. Household Equities holdings as a percentage of GDP higher than previous cycle peaks.
  • The value of Household Real Estate holdings jumped $2.480 TN to a record $48.870 TN, lagging only Q1 2022’s $3.561 TN increase. It’s worth noting that the largest quarterly Real Estate gain during the mortgage finance Bubble period was Q3 2005’s $864 billion. Over the past 15 quarters, Household Real Estate holdings inflated $15.809 TN, or 47.8%.
  • The banking system is on much greater Credit risk than mortgage risks were offloaded during the 2008 mortgage finance Bubble. At $25.6 TN, Banking System Assets ended 2022 almost double the 2007 level.
  • In nominal dollars, system Credit expanded $795 billion during Q2 to a record $96.327 TN, with NFD expanding $1.111 TN (to $71.248 TN), while financial borrowings contracted $329 billion (to $20.350 TN) (Foreign borrowings were little changed).
  • System Credit posted one-year growth of $4.193 TN, or 4.6%. Over the 14 quarters since the onset of the pandemic, System Credit has surged $21.457 TN, or 28.7%. NFD has inflated $16.722 TN, or 30.7%, since the pandemic – and has doubled (plus $35.675 TN) since 2008.
  • If it doesn’t burst well, we circle back to the popular view that Financial Sector debt included in analysis would be “double counting” borrowings already included elsewhere (i.e. mortgage and business). The swift end to backs, the shocking management out there and geopolitical cold war out there has us ready to expect the unexpected and aware of moves to mitigate by central banks as we saw a few weeks ago.
  • GSE Assets declined $131 billion during Q2 to $9.409 TN. FHLB Loans fell $187 billion during Q2 to $855 billion. Still, FHLB Loans posted one-year growth of $335 billion, or 64.3%.
  • Over six quarters, FHLB Loans expanded $520 billion, or 155%. GSE Assets expanded $1.117 TN, or 13.5%, over six quarters, and $2.279 TN, or 32.0%, over 14 quarters.
  • FHLB plays a pivotal role, last year prolonging the lending boom and stabilizing bank liquidity.

The Credit cycle downturn is coming to the surface.

We have the reflective destabilizing Monetary Disorder. Take a peek at China and the markets collective cognitive dissonance to the property market there, the shadow banking as just one example. Have a look around the world. The hope is the collective mass continues to evolve and survive, while each time the destruction is evident in massive disproportion shifts of wealth and attempts of mind, if not physical control of the masses. Dial that back and try and get in the minds of those trying to right the ship and the market components that matter, not what the dribblers think matter.

Here’s a thought, knowing about the power of cognitive dissonance does not necessarily protect you from its effects. Traders are only too aware of this eureka moment when you grasp it. Why some of the best trades you ever do, are the ones you don’t. In option parlance, being delta neutral sometimes is the best trade.

Key this coming week will be the commencement of the next round of such indicators that will test whether these gains were one-offs or something that is sustainable. The key will be the extent to which downside risks to the US economy have been reduced enough to influence global central banks, and how markets react.

The Fed’s aggressive tightening cycle has had little effect on loose financial conditions.

Where to from here? It’s also okay to acknowledge and process any difficult emotions or experiences that you may have had during the past year. Looking back on the past year with perspective can help you to gain a greater understanding of what you have been through and how you have coped. I hope that you are able to find ways to manage any challenges that come your way and that you continue to feel fine moving forward. Embrace the chaos that is headed your way in 2023!

China; Behind the Iron Curtain

A big shift in 2022, China’s population is now falling and below that of India. China’s population fell for the first time since 1961 as births have steadily fallen in recent years despite the removal of the “one child policy”. The stalling working age population and its likely decline ahead means that potential growth in China is down from around 10% or so in the 2000s to around 4-5% now.

Growth in China’s metric of system Credit growth, Aggregate Financing, dropped to $175 billion, down significantly from March’s $773 billion and only 61% of estimates. It was also the weakest monthly growth since last October.

“China is warning domestic brokerages not to spread information that compromises national security, reinforcing a campaign that has roiled consulting firms and providers of financial data.”

  • September 7 – Reuters (Ziyi Tang and Ryan Woo): “Five of China’s major state banks said… they will start to lower interest rates on existing mortgages for first-home loans, part of a series of support measures announced by Beijing in recent weeks. Chinese regulators announced the policy last week to help homebuyers amid growing concern over the health of the world’s second-largest economy and a series of crises in the nation’s property sector.”
  • September 7 – Reuters (Joe Cash): “China’s exports and imports extended declines in August as the twin pressures of sagging overseas demand and weak consumer spending at home squeezed businesses… Exports dropped 8.8% in August year-on-year, customs data showed on Thursday, beating a forecast of 9.2%… and off a 14.5% drop in July. Meanwhile, imports contracted 7.3%, slower than an expected 9.0% decline and last month’s 12.4% fall.”
  • September 5 – Reuters (Julie Zhu, Kevin Huang, Yelin Mo and Roxanne Liu): “China is set to launch a new state-backed investment fund that aims to raise about $40 billion for its semiconductor sector…, as the country ramps up efforts to catch up with the U.S. and other rivals. It is likely to be the biggest of three funds launched by the China Integrated Circuit Industry Investment Fund… Its target of 300 billion yuan ($41bn) outdoes similar funds in 2014 and 2019, which… raised 138.7 billion yuan and 200 billion yuan respectively.”

The Market Tripod of Destruction.

  • Firstly, financial asset overvaluation has swung way past any sound underlying economic wealth structure.
  • Secondly over-leverage in crowded bets.
  • Thirdly we have greed enthused, as always in these cycles, risk engineering, transfer and management that ignores or understands bifurcation and contagion outcomes.

Leverage has become toxic, a development that if not addressed will have deep and with far-reaching sequels. It’s not too farfetched to suggest that the markets are on the verge of a rupture that would be difficult to contain. Should the crisis of confidence dynamics that hit Britain feed into other markets a powerful global contagion could be unleashed. The markets are dislocated, and financial stability is at risk. A sobering thought is the UK is just the initial first world pension system in this cycle facing the harsh reality of a steep devaluation of assets and the prospect of widespread insolvencies and debilitating negative sentiment.

Inflation Matters

Inflation with Henry Kaufman

Kaufman is the legendary chief economist and head of bond market research at Salomon Brothers is someone who knows Inflation.  Henry Kaufman in an interview with Bloomberg’s Erik Schatzker Jan 14, 2022:

 “I don’t think this Federal Reserve and this leadership has the stamina to act decisively. They’ll act incrementally. In order to turn the market around to a more non-inflationary attitude, you have to shock the market. You can’t raise interest rates bit-by-bit.”

“The longer the Fed takes to tackle a high rate of inflation, the more inflationary psychology is embedded in the private sector — and the more it will have to shock the system.”

“‘It’s dangerous to use the word transitory,’ Kaufman said. ‘The minute you say transitory, it means you’re willing to tolerate some inflation.’ That, he said, undermines the Fed’s role of maintaining economic and financial stability to achieve ‘reasonable non-inflationary growth.’”


Independence – Never Take It for Granted Traders

“In aggregate, the market goes from order to disorder, and on that journey little pockets of order can form, including in commodities, bonds, stocks, currencies that circle back and reorder disorder. Then there is us the market player that reflects through order and disorder in an ever-evolving loop towards independence. It all starts with gravity and ends with equilibrium and back we go.” KnovaWave “The rules of market flux”

The Fed has kicked off its first real tightening campaign since 1994, with securities markets already at the brink of illiquidity and dislocation. Markets could soon be screaming for assurances of the Fed’s “buyer of last resort” liquidity backstop, while the Fed is prepared to begin withdrawing liquidity by selling Treasuries and MBS.

Another important aspect is the Fed doesn’t Control corporate pricing or wage decisions. Let us be clear geopolitical, climate change developments and what an out of depth, politically motivated administration are outside the Fed’s sphere of influence. There has been over $5.1 Trillion new “money” in 126 weeks, it’s a reasonable conclusion the Fed has lost control of Inflation.

We need to grasp all the risks to be wary off and received plenty of flak from it. We always talk here about expect the unexpected and now that is front and center, gage the market’s reaction, the market is always right and that’s why we focused on the crowd psychology aspect over the past few weeks.

“We have a market trying to interpret the Fed who is trying to find out how they can interpret their long-only portfolio at a risk parity where rates cannot rise.”

– MoneyNeverSleeps

This move has crept up on many, to the extent the S&P 500’s is over the traditional measurement of a new bull market typically measured as a 20% gain from a significant low. The index above 4292.438 got that 20% move. That ended the longest bear market since 1948. The DAX and CAC40 have seen all-time highs recently also.

Our weekly reminder for risk. The downside is clear with the absence of moral hazard from repeated Federal Reserve market bailouts in an environment of some would say obscene liquidity pumps. Pure greed is the other part, not wanting to miss out on fees. The obvious question is, how deeply ingrained is this attitude through the markets? How do we ween the markets off this continuous dip feed? At this point the Central Banks have kicked that answer down the road.


Part A – Stock Markets

Weekly Highlights – USA

Indices

  • S&P500 dropped 2.9% (up 12.5% y-t-d),
  • Dow fell 1.9% (up 2.5%). The Utilities lost 1.7% (down 11.4%).
  • S&P 400 Midcaps dropped 2.8% (up 2.7%),
  • Small cap Russell 2000 sank 3.8% (up 0.9%).
  • Nasdaq100 fell 3.3% (up 34.4%).
Major US Stock Indices

YTD Report Card for the S&P Sectors

Sectors

Notably all 11 S&P 500 sectors finished in the red this week. The consumer discretionary (-6.4%), real estate (-5.4%), and materials (-3.7%) were the biggest laggards while the health care sector (-1.2%) saw the slimmest loss.

W/E September 15 2023

A breakdown of the performance of the S&P 500 sectors:

  • Utilities lost 1.7% (down 11.4%).
  • Banks sank 4.6% (down 22.2%),
  • Broker/Dealers slumped 3.8% (up 8.7%).
  • Transports fell 2.3% (up 11.9%).
  • Semiconductors slumped 3.2% (up 32.9%).
  • Biotechs dropped 3.3% (down 5.1%).
  • With bullion little changed, the HUI gold equities index fell 2.7% (down 2.9%).

Biggest SPX Stock Winners and Losers Last Week

Major US Indices

When Markets Get Short Behind the Curve

Worth reading again what fueled the recent rally… and then the sell off after ….

We analyzed the short component of this year’s rally back in May and it an important component of the market’s structure. Global stocks have continued to climb the wall of worry in 2023, with what has become a series of saves from the brink of economic disaster in a political episode worthy of the best Monty Python minds. The end result has left many investors over insured at times as we have been focusing on with option saturation, short bets and long only investors out of the market. The latter in a rising market essentially makes them short.

This background is not new we have seen it many times over the last 20 to 30 years. The difference here is the sheer weight of money in the system and the introduction of shorter dated options and so many playing it.

Speculators and hedge funds had put on the largest short positions in the S&P 500 since 2007 according to Bespoke Investment Group using CFTC data measured as a percentage of open futures-market interest.

At the same time, they have bet long on the Nasdaq-100, with net bullish plays nearing the highest levels since late last year, remember that. Markets go where the most pain is. The move, in a world where averaging your position is seen as trading has fueled larger positions. Anyone understand the martingale principle?

Fed Assets expanded $364 billion over three weeks in March in banking crisis liquidity operations (the market has a short memory that was only 8 weeks ago and helped create bigger shorts out there). Assets remain about $45 billion above the March 1st level. FHLB assets expanded an unprecedented $317 billion during Q1 ($802bn over 4 quarters). Indicative of the liquidity surge, money market fund assets inflated $384 billion in the five weeks beginning March 8th. In affect we got a massive boost a surge in financial sector Credit with those FHLB money market borrowings to finance its massive banking liquidity support operations.

That’s all well and good the trouble it is up, and substantially and the cost of carry is around 6-12% not 0-2% from last year. Trading from the short side is about timing, recognition and as they say strike like a cobra. The demise of the Californian and New York Regional Banks was a prime example, they were on the radar and once the cracks appeared, go hard, go fast.

Where are the Shorts Trapped at? (Becomes the Longs After Wave C’s or 3’s)

There is two ways of looking at this the bears and the dribblers out there argue it all has to come down. The rationale being the S&P 500 was up 12% this year, however it would be negative without the contribution of seven big tech companies. The argument is should any of those plunges then we are back to bringing it all down. The problem is it has gone up, we look at the AAPL and NVDA for just two names that dominate structure.


Global Stock Market Highlights

Highlights – Europe Stocks

Week/YTD

  • U.K.’s FTSE equities index slipped 0.4% (up 3.1% y-t-d).
  • France’s CAC40 slumped 2.6% (up 11.0%).
  • German DAX equities index fell 2.1% (up 11.7%).
  • Spain’s IBEX 35 equities index declined 0.5% (up 15.5%).
  • Italy’s FTSE MIB index fell 1.1% (up 20.5%).

Germany’s benchmark Blue Chip DAX 30 index (Deutscher Aktienindex) expanded to 40 companies on 20 September 2021 adding 10 new members to the German stock index from the MDAX which will be reduced from 60 to 50 members.

Highlights – Asia Stocks

Week/YTD

  • Japan’s Nikkei Equities Index dropped 3.4% (up 24.2% y-t-d).
  • South Korea’s Kospi index sank 3.6% (up 12.2%).
  • India’s Sensex equities index dropped 2.7% (up 8.5%).
  • China’s Shanghai Exchange Index increased 0.5% (up 1.4%).

HighlightsAustralian Stocks

  • Australia’s S&P/ASX 200: +0.1% on Friday to 7068.8 (-2.9% for the week)
  • Worst performance since August last year.
  • Woodside Energy +0.6% after labor unions and Chevron agreed a deal,
  • Singapore iron ore October futures up 2.00% Friday, Iron ore miners, with Fortescue Metals Group up 1.5% and Rio Tinto – 1.5% BHP up 0.5%
  • Ramelius Resources shares were the best-performing on the ASX, up 7.25%.
W/E 9/22/23

Highlights – Emerging Markets Stocks

Week/YTD 

  • Brazil’s Bovespa index dropped 2.3% (up 5.7%),
  • Mexico’s Bolsa index recovered 0.6% (up 6.6%).
  • Turkey’s Borsa Istanbul National 100 index rallied 1.0% (up 45.9%).
  • Russia’s MICEX equities index sank 3.3% (up 41.5%).

Technical Analysis

S&P 500

Daily: The daily SPX closed above the previous roof (Key Spits) which were also at 7/8 and clustered around the 50% & August breakdown. With energy and with a very low VIX it has mirrored the get cloud to get through overhead. The bullish take is that we completed the correction off last year’s high at the low and this is a larger 1-2 to go higher with support at the previous resistance and cloud. The bearish outlook is this move becomes a rising wedge and we are working out the uber bears before new lows.

When we talk about crowd psychology this is a great example. The market after spitting the 4100 and 38.2% retracement broke to capture the Tenkan. This underscores the power from the SPX spat of June & October lows with impulse through the tenkan and Kijun energized by the daily cloud twist that fueled this rally. The completive wave came off extreme fear and bear that ended with relief. Now we have sated much of the greed phase and short fear phase. We have completed that cycle and from here we measure the alternatives.

It is worth looking back at the completive highs (all-time highs) and how we played out so far. Tracing back from highs the fuel from the top of the channel after completing 3 waves off ATH, accelerated after broke the Tenkan through to the 4600 OI where it reversed with impulse back to Tenkan. Bulls, this is likely a (ii) of a 5. Bears this is 1-2 of (i) completive V of degree. We watch if this low was a (iii), (a) or C. We have to respect the number of alternatives of degree of 5. With such trends keep it simple. From no fear to panic is the driving element.

On the downside the Kijun and those June lows now critical and is our trading Bear/Bull pivot in a high vol scenario. Watch each measured 3 wave move on the 240 & Murrey Math highlighted in the podcast. The prices pulled through the downward cloud pulled by the twist ‘helium contusion’ on the completive. For fractal purposes, SPX completed 5 waves up where it reversed with impulse. Energy fueled from the power impulse down from +1/8 ATH spit of a spit fail. On the way down (just like up) it accelerated after it broke the Tenkan through the rejected Kijun and then through the median after tapping 8/8.

Weekly: The SPX has a clear channel off the lows on the weekly timeframe off the sphere of influence and has ground higher since it closed over the cloud above the Tenkan. Key support is the Tenkan, channel and +1/8. Power initially came from launching out of the sphere of influence as one would expect in a 3 or C. We had the Kijun spit also. Above is the channel and +3/8.

In the bigger picture we are playing out S&P 500 energy after it held the sphere of influence from Nov 2020 reversed higher after spitting the 38% and key lows. At the time we opined “We do have a weekly cloud twist; however, the energy is waning without sharp impulse.” We got the sharp impulse right to weekly Kijun. For major cycles we watch the S&P 500 over 4,231, the 50% retracement of losses from the Jan. 3 & June 16 close. Since 1950 there has never been a bear market rally that exceeded the 50% retracement then gone on to make new cycle lows. Is this time different, as we tested and spat those June lows?

On the way up each new high evolved after testing Tenkan key support on the way and we are now getting a retest as resistance. We reiterate this needs to be recovered for a resumption of the uptrend meanwhile the bear market plays out. Watch Tenkan this week and watch for Kijun reaction. Extensions are difficult to time, keep it simple.

THE KEY: Key for the impulse higher was the spit or retest of MM 8/8 and Tenkan San, which held with the previous highs and Tenkan.  To repeat “We look for 3 waves down and reactions to keep it simple with the alternatives in the daily.”  Keep an eye on the put/call ratio with recognition to the sheer size of contracts AND keep in mind the stimulus distortion. The spit per channel fractal and Adams rule launched back over the cloud where we were encased AND we are back testing it. Watch if a spit or clear break support as Chikou rebalances.

A reminder that Apple Inc $AAPL, Microsoft Corp $MSFT, Amazon.com Inc $AMZN, Facebook Inc $FB, and Google-parent Alphabet Inc $GOOGL make up approximately 23% of the total weight of the S&P 500. With that comes gyrations that are an outsized impact on broader markets

NASDAQ 100

The down move saw Nasdaq spit the weekly Kijun and a 1-2 off tenkan we spat MM 5/8 after holding the key 61.8% Fib. We watch the Tenkan & Kijun confluence above, the breakup level and between the 38/50 Fibs. The Nasdaq is well behind the S&P pace with the weekly cloud and 50wma well above. Support the 61.8% retest.

Recall ATH was after it broke and held the weekly Tenkan to see a spit of a spit fail which is completive of 5 of some degree with Chikou rebalancing. Watch Chikou for divergence for continuation or failure. Divergence with Russell also a clue.

Russell 2000

The small cap Russell RUT bounced in double bottom off 1600 5/8 confluence which was the Nov 2020 breakup. Russell 2000 Resistance Tenkan and Kijun, note previous rejections. This is the index showing more of the fast money crowd and is trading like it. Needs to get traction in here for bulls. 7/8 & 8/8 support collapsed on the way down and is now major resistance.

Russell Index Negative Divergence to NASDAQ

Dow Jones

The Dow led the indices and closed above the weekly Tenkan after closing and testing last week. Prior test after the reaction off the June lows and sphere of influence. Support is the channel and Fibs. Tenkan and Kijun after the reaction empowered. Support is the channel and Fibs.

Semiconductors

NVidia $NVDA

Nvidia NVDA stock chart

NVidia surged 179.3% in H1 2023. It has been relentless since earnings and is the focus of the AI craze. With all manic moves beware of the pullbacks and topping potential. That said the extensions have played out and so far to +2/8 on the weekly. This was a classic set up as we can see. It has a textbook of KnovaWave methodology and rules from the 61.8% break and reverse through the sphere. NVDA accelerated after it broke the double top spheres at 5/8 giving is a near 4/8 move. A reminder that the dominance was in.

NVDA took off after the breakup retest from May 2021. NVidia is a clear leader of SOX & SMH look for cues there and ABC failures for changes. NVDA never looked back after the Key Break (mauve) and Tenkan to a flat cloud and holding support the recent low at the 61.8% extension.

Apple $AAPL

Apple AAPL Stock Chart

Apple has consistently driven upwards after it held the sphere of influence after retesting 6/8 & break up. Kijun and Tenkan crossing and then the 50wma with the cloud twist have been magnetic. Apple & other mega-cap names dominant the major indices, and a plethora of funds that hold it as a core position. The Vanguard Mega-Cap Growth ETF (MGK) delta is important to watch.

A firm rejection at $175 at +2/8 triggered a waterfall down for Apple last year. We regathered that and more and broke the weekly bull flag higher. On the way up Apple gently motored up to new ATH over the massive $160 then $170 thru to $180 gamma level on the way down these levels became key energy levels all the way to $132. Support held at the May break (just like NVDA) where from there it spat the cloud pulled by a flat Tenkan and Kijun as it rebalanced Chikou. The old channel break and MM +2/8 is now key. Remember the impact $AAPL has, at least short term on all the major indices.

ARKK ETF

Ark ARKK ETF Stock Chart

The ARK Innovation ETF (ARKK) finally found some support at -1/8, 78% off highs and the 423.6% extension! The ARK Innovation ETF returned 29% for Q1 2023. The fund is filled with growth stocks and was the top-performing U.S. equity fund tracked by Morningstar in 2020, it has not been a pretty slide. For the quarter, Nasdaq Computer Index up 25.7% and the NYSE Arca Technology Index gaining 26.1%. The Nasdaq100 (NDX) jumped 20.5%.

The ARKK ETF trading clinically, tested triangle breakdown and failed off 50 WMA. Some work at support at 61.8% of whole move and then wrecked again. Clear crowd behavior, we saw ATH in NASDAQ & SPX, yet this couldn’t raise a bid – very telling negative divergence. $ARKK rebalanced Chikou at week’s end

ExxonMobil XOM

ExxonMobil Weekly Chart

XOM has completed 5 waves from -3/8 to +3/8 on the weekly. with a double top. Alternatives 5 complete of degree. We are in a 1-2 (A-B depending on degree. Support is the cloud which has held 3 times since the high and the 50WMA resistance the tenkan and Kijun. Pattern wise we are in the bull flag until proven otherwise.


Part B: Bond Markets

Bond Watch

Treasuries

A busy week for bond traders after a tidal wave of global central bank monetary policy decisions headlined by the Fed’s FOMC, Bank of England, Norges Bank, and the Swiss National Bank together with a slew of global macro readings. U.S. Treasuries ended Friday with gains across the curve, reclaiming some of their losses after the FOMC reinforced the higher for longer mantra. 10-year Treasury bonds hit 4.48%, a new 15 year high intraweek. 30-Year conventional mortgage at 7.49% a new 23 year high intraweek. Credit spread 1.72%, down -.04% w/w (1.72-2.42) (new 1 year low).

Treasury Yield Watch

Friday/Week

  • 2-yr: -2 bps to 5.12% (+8 bps for the week)
  • 3-yr: -3 bps to 4.83% (+13 bps for the week)
  • 5-yr: -5 bps to 4.57% (+12 bps for the week)
  • 10-yr: -4 bps to 4.44% (+12 bps for the week)
  • 30-yr: -3 bps to 4.52% (+11 bps for the week)

Higher for longer is a serious threat.

Surging market yields are a serious issue for a banking system loaded with long duration securities portfolios. This may well be a push over the cliff for troubled commercial real estate (CRE). Leveraged lending and leveraged finance gets more costly. Simply there are trillions of floating rate loans among individuals, speculators, businesses, and nations.

Remember this? There is a reason why we focused on it recurring, you didn’t need Fitch to remind you:)

  • The iShares Investment Grade Corporate ETF (LQD) declined 1.01% Thursday, the largest loss since May 1st. The 2.40% loss for the week was the largest since February.
  • The iShares High Yield ETF (HYG) declined 0.73% Thursday, also the largest decline since May 1st. The 1.63% loss for the week, the worst weekly performance since early-March.
  • Friday Bloomberg headlines: “HYG ETF Daily Outflows $1.13 Bln, Biggest Move Since March 28th.” and “Two Giant Credit ETFs Hit by $2 Billion Exit on Hawkish Fed Bets.”

For our complete Weekly Fixed Interest Analysis and Outlook visit our Bond Traders Weekly Outlook:

Mortgage Market

  • Freddie Mac 30-year fixed mortgage rates slipped a basis point to 7.23% (up 94bps y-o-y).
  • Fifteen-year rates declined seven bps to 6.68% (up 124bps).
  • Five-year hybrid ARM rates added a basis point to 7.02% (up 205bps).
  • Bankrate’s survey of jumbo mortgage borrowing costs had 30-year fixed rates up nine bps to 7.62% (up 107bps).
Mortgage News Daily

Global Debt Monitor

Highlights Unprecedented and Ongoing Surge in Global Debt

Last week, the Institute of International Finance (IIF) released their Q1 2023 Global Debt Monitor (GDM), highlighting the unprecedented – and ongoing – surge in global debt.

GDM Highlights:

  • “The global debt stock grew by $8.3 trillion to a near-record $305 trillion in Q123; the combination of high debt levels and rising interest rates has pushed up debt service costs, prompting concerns about leverage in the financial system.”
  • “Total debt of emerging markets hit a fresh record high of over $100 trillion (or 250% of GDP) – up from $75 trillion in 2019.”
  • “At close to $305 trillion, global debt is now $45 trillion higher than its pre-pandemic level and is expected to continue increasing rapidly.”
  • “Rise of private debt markets: Non-bank financial institutions (NBFLs) continue to gain prominence in global credit intermediation. The so-called ‘shadow banks’ now account for more than 14% of financial markets, with the majority of growth stemming from a rapid expansion of U.S. investment and private debt markets.”
  • “The Size of Private Debt Markets Surpassed $2.1 Trillion in 2022, Up From Less Than $0.1 Trillion in 2007.”

From the end of Q3 2019 through Q1 2023, Total Global Debt jumped $52.3 TN, or 20.7%, to $305 TN.

Over this period, “Mature” economy debt expanded 13.4%, while “Emerging” economy debt surged 38.9%. It’s worth nothing that in the “Emerging” category, “Household” debt surged 41.7%, “Non-Financial Corporate” 35.1%, and “Government” 55.7%. Since 2016, total global debt-to-GDP has surged from 210% to 360%. Global financial conditions remain loose. When they inevitably tighten, be prepared for serious dislocation.


Part C: Commodities

Highlights

September 15, 2023

Key Long Term Commodity Charts

Copper

Copper Supply Crunch

Gold

China added to its gold reserves for an eighth consecutive month. People’s Bank of China holdings of bullion rose by 680,000 troy ounces last month, according to official data released Friday. That’s equivalent to 23 tons.

Gold in Perspective

Energy

For complete Oil and Natural Gas Coverage please visit our dedicated publications ‘Around the Barrel’ and ‘Into the Vortex.’ – Weekly Analysis and Outlook for Energy Traders and Investors

WTI Oil

WTI Weekly KnovaWave Shape

Natural Gas

Energy Market Closes

BDI Freight Index

Baltic Dry Index Weekly

For our complete Weekly Commodity Analysis and Outlook visit our Commodity Traders Weekly Outlook:

Charts and commentary via KnovaWave on:

  • Grains: Wheat, Corn, Soybeans
  • Metals: Copper, Aluminum
  • Precious Metals: Gold Silver
  • Lumber
  • Oil and Natural gas are covered separately (see below)

Part D: Forex Markets

John Maynard Keynes, 1920: “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction and does it in a manner which not one man in a million is able to diagnose.”

Highlights

  • For the week, the U.S. Dollar Index gained increased 0.2% to 105.58 (up 2.0% y-t-d) 2022 gains were 8.2%
  • For the week on the upside, the South African rand increased 1.4%, the New Zealand dollar 1.0%, the Swedish krona 0.6%, the Canadian dollar 0.3%, the Norwegian krone 0.2%, and the Australian dollar 0.1%.
  • On the downside, the Brazilian real declined 1.5%, the British pound 1.2%, the Swiss franc 1.1%, the South Korean won 0.8%, the Mexican peso 0.7%, the Japanese yen 0.4%, and the Singapore dollar 0.1%. The Chinese (onshore) renminbi declined 0.32% versus the dollar (down 5.49%).

Weekly Foreign Exchange Price Change

For our complete Forex Weekly Analysis and Outlook visit our Forex Traders Weekly Outlook:

Charts and commentary via KnovaWave on the US Dollar, Euro, Japanese Yen, British Pound, Euro Pound, Swiss Franc, Canadian Dollar, Australian Dollar, New Zealand Dollar, Turkish Lira, Mexican Peso. Currency dynamics are complex. There are myriad facets to analyze and contemplate that influence all markets.

Cryptocurrencies

Bitcoin

Bitcoin continues to be plaything of levered speculators; this week we saw the markets turn against those short. Where did this come from? Forced coverage from yield curve punts blowing up. Yen shorts and levered “carry trades” at risk.

It had been a churn following the FTX collapse. BTC had been stuck in the sphere of influence in continuation awaiting a catalyst, and it came. Continues to perform technically to perfection. Impulse begets impulse. To understand panic, understand greed. $BTC tested the top of a rising channel after the preceding sharp downturn which was the downside breakout of an earlier bearish flag, after breaking downside a H&S top and then down it went….

Recall Bitcoin exploded higher following it’s correction impulsively upon completing 5 waves up at +2/8. Each Tenkan and Kijun tap saw an explosive kiss of death until we completed 3 waves to around 28,000. From there we have seen extreme volatility.

Bitcoin KnovaWave Weekly Outlook

Looking back Bitcoin put in a high of $63,000 around Coinbase, the largest US crypto exchange successfully went public which signaled profit-taking. The high over $68,000 came after the launch over the Bitcoin ETF. From that high we have 2 main alternatives a V of a 1 of a V. For bears it a completive five with impulse right to the 50wma – an incredible 26% fall in a Friday night session. That’s impulse!

Bitcoin Mania in Perspective

On the Risk Radar

Fed Warnings on Possible Medium To Long Term Risks

 Geopolitical Tinderbox Radar

Turkey Geopolitical
Turkey Risk Monitor

Economic and Geopolitical Watch

Banks

Major US Banks for Q2, 2023

America’s big money center banks kicked of second quarter earnings with a solid start with solid beats by JP Morgan Chase, BlackRock, Wells Fargo, Citigroup and State Street.

Q223 Reports

Akio Morita mistakes

The Week Ahead – Have a Trading Plan

What Macro and Micro Risks and Opportunities Lie Ahead this week

Global Watch

Next Week’s Risk Dashboard via Scotiabank

  • Gullible markets?
  • US core PCE inflation probably rose a little less than core CPI
  • Eurozone CPI starts the march to the next ECB meeting
  • CDN GDP and serial shocks
  • China PMIs could continue to stabilize
  • Deadline to avoid a US government shutdown
  • Banxico outlook complicated by the Fed’s shift
  • BanRep expected to hold again on elevated inflation
  • BoT may deliver another hike
  • Canada’s economy should be able to handle mortgage rate resets

Central Bank Watch

With the big dogs out of the way we get a chat from Fed’s Powell and decisions this week from central banks in Hungary, Mexico, Colombia and Thailand. Focus will be on Friday’s release of U.S. consumer spending, incomes and saving rates which includes Fed favorite core PCE inflation, also we get Eurozone inflation with September’s CPI rate.

Eyes and ears will be on central bankers. We have the backdrop of a more hawkish Fed Chair in the face of escalating systemic risk. How will this affect Fed policy given the massive treasury positions out there and the risk of uninsured funds? In this environment we get pivots daily. How much damage is the Federal Reserve willing to do in the guise of controlling inflation?

This Week’s Interest Rate Announcements (Time E.T.)

In the week ahead we get 4 central banks delivering policy decision.

Tuesday, September 26, 2023

  • 08:00 Hungary Interest Rate Decision

Wednesday, September 27, 2023

  • 03:00 Thailand Interest Rate Decision

Thursday, September 28, 2023

  • 15:00 Mexico Interest Rate Decision

Friday, September 29, 2023

  • 14:00 Columbia Interest Rate Decision

For our complete Central Bank Analysis and Outlook Visit our Central Bank Watch:

U.S. Economic Data Watch

US Data Focus

  • Monday: Nothing of note
  • Tuesday: July FHFA Housing Price Index (prior 0.3%) and July S&P Case-Shiller Home Price Index (prior -1.2%) at 9:00 ET; August New Home Sales (prior 714,000) and September Consumer Confidence (prior 106.1) at 10:00 ET; and $48 bln 2-yr Treasury note auction results at 13:00 ET
  • Wednesday: Weekly MBA Mortgage Index (prior 5.4%) at 7:00 ET; August Durable Orders (prior -5.2%) and Durable Orders ex-transportation (prior 0.5%) at 8:30 ET; weekly crude oil inventories (prior -2.14 mln) at 10:30 ET; and $49 bln 5-yr Treasury note auction results at 13:00 ET
  • Thursday: Q2 GDP – third estimate (prior 2.1%), Q2 GDP Deflator – third estimate (prior 2.0%), weekly Initial Claims (prior 201,000), and Continuing Claims (prior 1.662 mln) at 8:30 ET; August Pending Home Sales (prior 0.9%) at 10:00 ET; weekly natural gas inventories (prior +64 bcf) at 10:30 ET; and $37 bln 7-yr Treasury note auction results at 13:00 ET
  • Friday: August Personal Income (prior 0.2%), Personal Spending (prior 0.8%), PCE Prices (prior 0.2%), Core PCE Prices (prior 0.2%), advance goods trade balance (prior -$91.2 bln), advance Retail Inventories (prior 0.3%), and advance Wholesale Inventories (prior -0.1%) at 8:30 ET; September Chicago PMI (prior 48.7) at 9:45 ET; and final September University of Michigan Consumer Sentiment (prior 67.7) at 10:00 ET

US Stocks Watch Earnings and Event Watch

Earnings Highlights This Week:

The Q2 2023 reporting season has almost ended, but there are still companies reporting this week.

  • Monday includes Thor Industries (THO).
  • Tuesday includes Costco (COST), Cintas (CTAS), and United Natural Foods (UNFI)
  • Wednesday includes Micron Technology (MU), Paychex (PAYX), and Jefferies Financial Group (JEF)
  • Thursday includes Accenture (ACN), Nike (NKE), CarMax (KMX), Jabil (JBL), Blackberry (BB)
  • Friday includes Carnival (CCL).

Investors (and algos) will focus on the conference calls and outlooks. Last quarter everyone expected the worse, we saw critical updates on production in coronavirus impacted regions and if there is extended halting of operations weighing on multi-nationals. 

Events

Saturday, Sept. 23

  • 78th session of the UN General Assembly (plenary) continues
  • German Chancellor Scholz attends SPD campaign events in Nuremberg and Hesse

Sunday, Sept. 24

  • Austrian Chancellor Nehammer opens Salzburg Europe Summit

Notable conferences running during the week include:

  • TD Paper & Forest Products Conference,
  • Emerging Growth in A.I. Conference,
  • Cantor Fitzgerald Global Healthcare Conference,
  • William Blair’s What’s Next for Industrials Virtual Conference,
  • RBC Capital Markets Global Communications Infrastructure Conference,
  • Jefferies 2023 Virtual Pet Care & Wellness Conference.

Monday

  • IAEA General Conference starts in Vienna
  • German Chancellor Scholz and Economy Minister Habeck attend the national aerospace conference
  • European Budget Commissioner Hahn and Austrian Finance Minister Brunner speak at the Salzburg Europe Summit
  • Huawei will hold a product event for the media. Analysts will be looking for details on the latest Mate 60 Pro 5G smartphone and details on the chip used. The last Huawei phone introduced used a chip made by China’s Semiconductor Manufacturing International (OTCQX:SIUIF), which caused concern in the U.S. National security adviser Jake Sullivan said recently that the U.S. needed to get more information on the precise character and composition of the chip powering Mate 60 Pro.

Tuesday

  • Spanish Parliament begins debate on the new prime minister. Vote to occur on Sept. 27th
  • German Chancellor Scholz speaks at the annual meeting of the German Society for International Cooperation
  • German Economy Minister Habeck speaks at the BDI climate conference
  • Workday’s (WDAY) four-day Workday Rising conference will begin.
  • ASM International’s (OTCQX:ASMIY) Investor Day,
  • Nutanix’s (NTNX) Investor Day,
  • Blend Labs’ (BLND) Investor Day.
  • The two-day Jefferies Cell & Genetic Medicine Summit will begin in New York City. Some of the notable companies participating include Caribou Biosciences (CRBU), Generation Bio (GBIO), Solid Biosciences (SLDB), 4D Molecular Therapeutics (FDMT), and Gracell Biotechnologies (GRCL).
  • Last trading date before the FDA action date on Brainstorm Cell Therapeutics’ (BCLI) late-stage investigational ALS treatment NurOwn.
  • The two-day Code Conference hosted by Vox Media will begin. Notable speakers include X CEO Linda Yaccarino, AMD (AMD) CEO Lisa Su, Roblox (RBLX) CEO David Baszucki, Warner Music (WMG) CEO Robert Kyncl, and General Motors (GM) CEO Mary Barra.
  • The Alliance for Automotive Innovation Inaugural Auto Tech Showcase will include a speech from Luminar (LAZR) CEO Austin Russell and participation from companies that include Autoliv (ALV), Mercedes-Benz Group (OTCPK:MBGAF), Honda Motor (HMC), and VinFast Auto (VFS).
  • Microsoft’s (MSFT) AI assistant for Windows will roll out.

Wednesday

  • Foreign ministers of Austria, Slovenia, Slovakia, Czechia, and Hungary hold a briefing in Vienna
  • TotalEnergies (TTE) Investor Day
  • Zeta Global’s (ZETA) Investor Day,
  • Marriott International’s (MAR) Security Analyst Meeting,
  • Encompass Health’s Investor Day (EHC),
  • Sensata Technologies’ (ST) Investor Event,
  • Generac’s (GNRC) Investor Day,
  • Stevanato Group’s (STVN) Capital Markets Day,
  • Workday’s (WDAY) Analyst Day,
  • Sprout Social’s (SPT) Investor Day.
  • The two-day META Connect conference will begin. Meta Platforms (META) CEO Mark Zuckerberg will be a keynote speaker at the event, which will be focused on AI and virtual, mixed and augmented realities. Morgan Stanley called the event a potential share price mover. The firm is looking for new user-facing AI tools to be unveiled, including large language model chat experiences and potentially new developer, creator or advertiser tools.

Thursday

  • German Chancellor Scholz, Belgian Prime Minister De Croo, Bank of America CEO Brian Moynihan, and BlackRock CEO Larry Fink attend the Berlin Global Dialogue
  • IEA’s Critical Minerals and Clean Energy Summit in Paris
  • Flowserve’s (FLS) Analyst Day,
  • Philip Morris International’s (PM) Investor Day,
  • nCino’s (NCNO) Investor Day,
  • WAVE Life Sciences’ (WVE) R&D Day,
  • Maravai LifeSciences’ (MRVI) R&D Day,
  • Intuit’s (INTU) Investor Day,
  • Affirm Holdings’ (AFRM) CFO Fireside Chat with Deutsche Bank.
  • CNBC Delivering Alpha Investor Summit will feature talks by Pershing Square Capital Management CEO Bill Ackman and other hedge fund managers.
  • Shareholders with Stratasys (SSYS) will vote on the deal for the company to be acquired by Desktop Metal (DM).
  • 5:00 p.m. – Nike (NKE) earnings conference call. The three stocks that have correlated the tightest with Nike (NKE) on earnings day over the last year are Foot Locker (FL), Dick’s Sporting Goods (DKS), and Skechers (SKX).

Friday

  • China’s ‘Golden Week’ holiday begins from Sept. 29 to Oct. 8
  • ECB President Lagarde speaks in Paris at an event on the energy transition
  • Helsinki Security Forum begins
  • Macau casino stocks on watch just ahead of the beginning of the high-traffic Golden Week holiday period and weekend release of the gross gaming revenue report for September.
  • Tesla (TSLA) spotlight on the last business day of the quarter as analysts Q2 deliveries estimates. The consensus estimate currently stands at 463K deliveries for the quarter.
  • The sale of Rovio Entertainment Oyj (OTC:ROVVF) to Sega Sammy Holdings (OTCPK:SGAMY) is expected to be completed.

Sovereign Rating Updates

  • Portugal (Fitch)
  • Turkey (S&P)

IPO Wrap

US IPO Week Ahead:


Focus on yourself and what YOU CAN INFLUENCE, set your trading plan and goals in be set for 2022.

-comment section below data-

Real Time Economic Calendar provided by Investing.com.

Subscribe and Follow

Find us at www.traderscommunity.com

Follow our contributors on Twitter @traderscom @thepitboss16 @knovawave @ClemsnideClem

Note these charts, opinions news and estimates and times are subject to change and for indication only. Trade and invest at your own risk.

Trade Smart!