Morning Brief: Hedge Funds Place Biggest Short Ever For Treasuries; Chinese Leaders Highlight Economic Risks; Grain Deal At Risk
Americas
Markets
Stocks end Friday's session little changed, Dow snaps 4-week win streak: Live updates https://t.co/YRPbY8HH9C
— Rajiv (@rajivshori62) April 22, 2023
The S&P 500 doesn't seem cheap pic.twitter.com/fsvi3nt1G8
— Markets & Mayhem (@Mayhem4Markets) April 23, 2023
Investors are pouring cash back into equity ETFs, unable to resist a stock rally that much of Wall Street is convinced is doomed https://t.co/i9Fj0RVL99
— Bloomberg (@business) April 22, 2023
*Focus on banks
U.S. bank deposits as of April 12 offer tentative signs the post-SVB declines at small banks have stabilized https://t.co/xvlAXsVRpD pic.twitter.com/1VN81B22Sd
— Nick Timiraos (@NickTimiraos) April 21, 2023
We're may see tighter bank lending standards in the months ahead, which may have the largest impact on small and medium-sized businesses as well as consumers.
— Markets & Mayhem (@Mayhem4Markets) April 22, 2023
The net impact is likely to be slowing economic growth. pic.twitter.com/cRawlg14Kz
Economic Indicators and Prospects
The US Conference Board LEI takes the 10 most effective leading indicators and aggregates them into an index
— Alf (@MacroAlf) April 20, 2023
The YoY change dropped further below -7%
Over the last 40+ years, every time this indicator drops < 0 and stays there for 2+ months we are in a recession
100% hit rate pic.twitter.com/pEIkEI0c0k
Companies that are planning to fire a large amount of people in the US have to file WARN notices.
— Alf (@MacroAlf) April 20, 2023
Bloomberg shows how the trend in WARN notices has picked up recently (blue), pointing to a further increase in jobless claims (white). pic.twitter.com/PhcKCRAKvn
Housing
Black Knight: "Mortgage Delinquencies Hit Record Low in March"https://t.co/TeXSuEAX8V
— Bill McBride (@calculatedrisk) April 21, 2023
"The national delinquency rate dropped 53 basis points (-15%) in March, falling below 3% for the first time on record, ending the month at just 2.92%"
CRE
Office occupancy rates continue to fall, with a widening gap between other types of property
— Markets & Mayhem (@Mayhem4Markets) April 21, 2023
Source: CoStar, Goldman Sachs https://t.co/pQFl7m5ePV pic.twitter.com/LpJIFUBSfJ
One warning sign is the growing share of floating rate commercial mortgage-backed securities originated in recent years, exposing more property owners to the 'higher for longer' Fed policy framework that is adding to overhead just as sales volumes decline. https://t.co/DaNqdCHCjV pic.twitter.com/ryjZn9x5Z1
— Markets & Mayhem (@Mayhem4Markets) April 21, 2023
Adding to concern about office space utilization is that lease absorption rates are falling, showing that there will be even lower levels of space utilization moving forward as hybrid and remote work as well as more difficult business conditions limit business appetites. https://t.co/KpSKkG1JBh pic.twitter.com/oILFWhi2Go
— Markets & Mayhem (@Mayhem4Markets) April 21, 2023
Fiscal Policy
The US Treasury has funds until late July according to Goldman pic.twitter.com/Tr8jIDSyhO
— Markets & Mayhem (@Mayhem4Markets) April 23, 2023
US sovereign 1yr CDS "is now notably higher than 82bps highs during the 2011 debt ceiling debacle and the US sovereign debt downgrade by the S&P" –bofa pic.twitter.com/HphmZY71xy
— Gunjan Banerji (@GunjanJS) April 23, 2023
Trade, Politics and Geopolitics
World military spending rises to a record as insecurity swells https://t.co/eFX8LU3uYH via @nicrolander pic.twitter.com/dAkpj9ejWB
— Zoe Schneeweiss (@ZSchneeweiss) April 24, 2023
Asia
Markets
South Korea will likely be a part of FTSE Russell’s World Government Bond Index next year, according to BNP Paribas https://t.co/2u18K9IB9O
— Bloomberg Markets (@markets) April 24, 2023
Economic Indicators and Prospects
Monetary Policy
Bank of Japan Governor Kazuo Ueda said on Monday the central bank's inflation forecasts must be "quite strong and close to 2%" in the coming year to consider tweaking yield curve control. https://t.co/28XIoIzDO3
— Qudach (@qudach) April 24, 2023
Trade, Supply Chain and Geopolitics
Japan’s LDP wins four of five seats as election talk simmers – Bloomberg https://t.co/MH1rKaN7Jw
— The Edge Malaysia (@theedgemalaysia) April 24, 2023
Australia’s military is not “fit for purpose” as it currently stands, according to a review that also recommends purchasing long-range missiles and drones https://t.co/5MVhQlggMN
— Bloomberg (@business) April 24, 2023
Europe
Markets
Economic Indicators and Prospects
UK Home Sellers Slow Pace Of Increase In Property Asking Prices – Bloomberghttps://t.co/RTDYUdPYvf
— Nicholas Brown (@News_By_Nick) April 23, 2023
German public-sector deal sees pay rise for 2.5 million workers https://t.co/xIe9bBnaR4 via @weberalexander @josefinefokuhl pic.twitter.com/XFAMLNGSc2
— Zoe Schneeweiss (@ZSchneeweiss) April 23, 2023
CRE
Commercial real estate prices in Europe are taking a serious bath: ~20% down in the last 12 month alone!
— Alf (@MacroAlf) April 22, 2023
Banks in the Nordics but also in Spain, France, NL and Germany are quite exposed to the sector.
Central Banks can backstop liquidity issues, but can't do much about this pic.twitter.com/ObFustPc79
Monetary Policy
ECB’s Stournaras says rates have reached close to maximum https://t.co/bqyqnk77fY via @NikasSotiris pic.twitter.com/M0WWNpDOe4
— Zoe Schneeweiss (@ZSchneeweiss) April 23, 2023
Fiscal Policy
UK's Sunak launches charm offensive on business leaders https://t.co/A1vIjpJCRe pic.twitter.com/PWMcc002OB
— Reuters (@Reuters) April 24, 2023
Trade, Supply Chain and Geopolitics
Good. https://t.co/ouw3NI9t04
— Voice of Reason (@brexitblog_info) April 21, 2023
Other Areas And Global Economy
Global shipping costs have continued to decline over the last months, they are now almost back to pre-Covid-19 levels. pic.twitter.com/O1GYj2fEAb
— Philipp Heimberger (@heimbergecon) April 24, 2023
Global lithium production has quadrupled since 2010.
— Velina Tchakarova (@vtchakarova) April 22, 2023
Roughly 90% of it came from just three countries – Australia, Chile and China. China, the third-largest producer, has a strong foothold in the lithium supply chain. Alongside developing domestic mines, Chinese companies have… pic.twitter.com/MBChA0p2ki