The lessons from 2001-2004
We’re now in 2001 with respect to currently unprofitable companies. The market prices of all companies that were unprofitable in 2001 didn't make any progress in the 3 years that followed. Those that turned profitable by 2004 were a ~3x on average. Source: Value investigator
The S&P 500 closed above its 200d MA for the 5th time since the start of the 2022 bear market
Source: Yuriy Matso
Only 10% of US equity funds survived and outperformed the S&P 500 since 1992
Source: Lipper, S&P Dow Jones
Auto stocks including Tesla fall after Tesla radically cut prices on its electric vehicles in bid to boost flagging demand.
Tesla dropped prices by nearly 20% in the US on some versions of the Model Y SUV, its top seller. It also reduced base price of Model 3 by about 6%. Source: Bloomberg, HolgerZ
US will hit its debt limit Thursday, start taking steps to avoid default, Yellen warns Congress
Source: Bloomberg, HolgerZ
Bank of Japan's daily government bond purchases at an all-time high!
The Bank of Japan is buying huge amounts of government bonds in order to cap the yield on Japanese 10-year government bonds to 0.5%. Yesterday the BoJ bought 4.6 trillion yen and today it is close to 5t yen. Note that at the last meeting, the BoJ had decided on a 9t yen bond buying program ...per month! Source: Bloomberg
Commodities are up double digits in the last 3 months
Over the last 3 months, Gold broke out, then silver, copper, and others are already up double digits in the last 3 months. Will Energy & agricultural commodities be the next ones to move? Steep moves in commodity prices often lead to a ripple effect in the market. Source: Crescat Capital, Bloomberg
First USD-denominated bond issued by a Chinese property developer since September 2021!
New positive sign for the Chinese real estate sector? After 16 months of waiting, the dollar-denominated debt market has reopened for a Chinese property developer, Wanda Properties, without any guarantee from the Chinese government. This new issue was well received by investors as the book was oversubscribed four times. However, the majority of investors were from Asia (>80%) and while this news is positive for the sector (and its liquidity problem), it does not solve the problem of sales (demand) for now. Source : Bloomberg
