Friday Chart Challenge: High Yield Edition

Here’s a chart that should give you pause: This is how we summed the situation up on Thursday in response to some suggestions that perhaps the US high yield market is somehow going to avert being dragged kicking and screaming into a default cycle by the beleaguered energy complex: “Remember that time someone said ‘I…

Trading An Uncertain World

Someone forgot to tell the terrorists that we’re in the middle of an increasingly epic bout of risk-on sentiment driven primarily by expectations that the Bank of Japan is all set to start throwing cash out of helicopters (figuratively speaking - maybe). Displaying a complete and total lack of regard for the ongoing global equity…

One Bank Answers “The Three Big Questions”

Two narratives we’ve been keen on exploring over the past several months are, i) the extent to which buybacks are responsible for persistent strength in US equities, and ii) how much of the bid for US Treasurys can be explained by negative rate policies in Japan and Europe. These are key considerations, especially if we…

Stocks Shake off Bank Of England “Hold”, Open At (New) Record

Goldman had a conviction going into Thursday’s Bank of England announcement. Here’s what the bank’s FX team put out this morning: “Today, the Bank of England holds its monetary policy meeting, which we expect to be the catalyst for a further downward move in the currency. As we explained in yesterday’s Global Markets Daily, the…

Barn Burner 30-Year Auction Shows Some Yield Still Beats Negative Yields

Do you hear that? It’s a big sigh of relief. Yesterday, we walked you through a disaster of a 10-year Treasury auction. Lowest bid-to-cover since March 2009, lowest indirect takedown since January of last year, and on, and on. We also explained why you should care. Negative yields in Germany, Switzerland, and Japan have driven…

Will The Earnings Recession End? One Bank Says Yes

Well, we hit new record highs on the S&P Tuesday. Is the rally for real? Let’s take a trip to technical analysis land and ask the imaginary chart patterns. Here’s BofAML technical analyst Stephen Suttmeier: “There were 414 calendar days between the May 2015 high and the recent one. Since 1929 there have been 24…

“Going Once, Going Twice”: 10Y Treasury Auction Has An “Oops” Moment

Oops. Going into this week’s 10- and 30-year Treasury auctions, there was a palpable sense of trepidation among some traders. Take Bloomberg’s Richard Breslow (whose daily market commentary is fantastic if you can get your hands on it), who wrote the following early this morning: “Today and tomorrow, the U.S. Treasury is auctioning 10-year and…

Theory Officially Triumphs Over Common Sense As Markets Hit Record On More Helicopter Talk

Theory Officially Triumphs Over Common Sense As Markets Hit Record On More Helicopter Talk So there are only three charts you need today. The first is a two-day chart of the yen: The second is of course the S&P: And the third comes courtesy of Google Trend: We talked at length on Monday about what’s…

Earnings Season Kickoff: A Look Across The Market

As we get set for what promises to be a rocky earnings season (consensus has S&P earnings falling for the fifth consecutive quarter), let’s take stock of how far we’ve come since Brexit. Here’s a look at global equities: Not bad, right? UK stocks are up 11% off the closing lows on Monday, June 27.…

“Get To The Chopper”: Japan Election, Bernanke Visit Fuel Helicopter Money Rumors

We’ve talked plenty in these pages about the ebb and flow between the Japanese yen and risk assets. Simply put, the yen is a safe haven currency. When you wake up to see it’s appreciated sharply against the dollar in the overnight session, you can pretty much immediately infer that the mood out there is…