The median year since 1928 has experienced a 13% intra-year drawdown in the S&P 500, making 2023 relatively mild by comparison
The 7.8% pullback in February-March is the largest thus far. Soruce: Charlie Bilello
S&P 500 Head & Shoulders ???
S&P 500 (SPX) was unable to breakout yesterday the July downtrend. Now there is a potential Head & Shoulders reversal pattern (one of the most reliable patterns). Keep an eye on the neckline at 4325 for a confirmation of the H&S. Source : Bloomberg
The BRICS economic coalition of emerging markets has decided to extend membership invitations to six nations.
The BRICS alliance — which presently reunites Brazil, Russia, India, China and South Africa — is set to invite Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates to join, Ramaphosa said in a speech published on the X social media platform, previously known as Twitter. The new composition of BRICS will control 80% of world oil production. The same goes for the sharp GDP growth of the new BRICS countries. It will amount to 30% of world GDP and exceed $30 trillion. Source: Sprinter, MoneyRadar
Strange day on Wall Street. Despite Nvidia blockbuster earnings the Nasdaq is in the red
Within $SPX the pockets of strength are in real estate, utilities, financials, healthcare, and consumer defensives. Low vol is outperforming high beta. There are rotations to safer parts of the market happening underneath the surface. Source: Markets Mayhem, Bloomberg
A fresh increase in the Atlanta Fed’s GDPNow model reinforces the reasoning behind hawkish-for-longer monetary policy, which is weighing on equities and bonds
The latest model estimate shows real 3Q GDP growth of 5.9%, up from 5.8% on Aug. 16 (it was less than 4% two weeks ago). Source: J-C Gand, Atlanta Fed
Lira Rallies as Turkey stuns with biggest rate hike in years
The central bank raises benchmark rate by 750 basis points. Turkish currency surges more than 5% against the dollar. The Monetary Policy Committee, under Governor Hafize Gaye Erkan, raised the benchmark one-week repo rate to 25% from 17.5%, the sharpest increase since 2018. Most economists polled by Bloomberg predicted a hike to 20%. It’s the latest indication that Turkey’s new administration is prepared to move away from the unorthodox policies — including ultra-loose borrowing costs — that were championed by President Recep Tayyip Erdogan but caused foreign traders to flee the country’s bond and stock markets en masse. Source: Bloomberg
EU Composite PMI... monetary policy works with a long and variable lag...
Source: Macrobond, Nordea
Since the COVID Crash lows in March 2020, US equity markets have more than doubled the performance of bonds
As shown below, that's the best performance ever over a similar time window, topping the strongest stocks-bonds outperformance from the tech bubble of the late 1990s and early 2000s. Source: Bespoke, J-C Gand
