The US yield curve continues to steepen.
Yields on 10-year Treasuries are the highest vs 2-year yields going back to 2022. Source: Lisa Abramowitz, Bloomberg
In case you missed it...
Intel & Amazon just Announced an Extended Multi Year Multi Billion Dollar Partnership. $INTC 📈 was up +10.85% in after hours Source: Trend Spider
Remember when early August the strengthening of the yen and ensuing carry trade unwinding was seen as a huge threat for the equity market?
Fast forward to mid-September: the S&P 500 and USDJPY are taking two opposite directions. The market doesn't seem to care anymore about the yen... Source: Bloomberg, RBC
Food for thoughts
Russian President Vladimir Putin in response to Russia’s declining birth rate, has launched an unusual initiative: encouraging Russians to have s*x during their work breaks... Source: The Times Of India
BREAKING: Prediction markets are now pricing-in a 48% chance of a 50 basis point Fed rate cut this week.
Odds of a 50 basis point rate cut have gone from 2% to 48% in just 5 days, according to Kalshi. This will be the first Fed policy decision without a 90%+ consensus since 2020... Source: The Kobeissi Letter
Is buying the dip still the best strategy? The average return when buying the dip in the S&P 500 varies based on timeframe.
Within 6 months of buying a -10% decline, the average return has been +13% compared to a +4% return when holding stocks through the pullback and recovery. Within 12 months, the "buy the dip" strategy has returned a +22% gain, beating a +5% return with the buy and hold strategy. On the other hand, buying dips over a 5-year period has returned +33%, well below a +75% from simply holding. In other words, buying the dip has been a successful strategy during periods of market volatility.
Bitcoin (+43%) and Gold (+25%) are the top performing major assets in 2024. We've never seen these two in the #1/#2 spots for any calendar year.
Source: Charlie Bilello
FED WILL CUT RATES ON WEDNESDAY FOR THE 1ST TIME IN 4.5 YEARS Stocks usually fall ~15% within 12 months following the 1st cut if there is a recession
If no recession, stocks rise by >10%. Key caveat is, that we will know if there was a recession a few months after the cut. Source: Global Markets Investor
