In case you missed it: Tuesday's rally was not driven solely by the Magnificent 7
Russell 2000 index of small-cap stocks soared a staggering 5.4%, as investors bet the Fed is done raising rates and could be cutting interest rates much sooner than expected. Source: HolgerZ, Bloomberg
"Mag 7" darling Nvidia $NVDA finished the day with its highest closing price in history
And the stock has now traded green for 10 consecutive trading days, its longest winning streak since December 2016. Source: Barchart
China on Wednesday reported better-than-expected retail sales and industrial data for October, while the real estate drag worsened
- Retail sales grew by 7.6% last month from a year ago, above the 7% growth forecast by a Reuters poll. Retail sales, sports and other leisure entertainment products saw sales surge by 25.7% in October from a year ago, the data showed. Catering, as well as alcohol and tobacco, saw sales surge by double digits. Auto-related sales rose by 11.4% from a year ago. - Industrial production rose by 4.6% year-on-year in October, faster than the 4.4% pace predicted by the Reuters poll. - Fixed asset investment for the first 10 months of the year grew by 2.9% from a year ago, missing expectations for a 3.1% increase. - Investment into real estate fell by 9.3% during that time, a steeper decline than the 9.1% drop reported for the first nine months of the year. - The urban unemployment rate was 5%, the National Bureau of Statistics said. That was unchanged from September. The bureau has suspended reports of the unemployment rate for young people since summer. Source: CNBC
Yesterday was the best market breadth day in the US since the Covid-19 stress exit...
Source: Lawrence McDonald, Bloomberg
What a day...
The US 10-year note yield fell sharply to 4.49%, after CPI inflation hits 3.2% in October. The 10-year note yield went down 20 basis points in 24 hours. Meanwhile, the U.S. Dollar Index $DXY had its biggest drop in more than a year. Source: The Kobeissi Letter, Barchart
Fund flows continue to move to the US at the expense of the rest of the world
Source: Michael A. Arouet, Goldman Sachs
It looks like the bears are throwing the towel...
Burry's bet against America..
JUST IN: Futures now show a 0% chance of additional rate hikes with rate cuts beginning in May 2024
Prior to today's CPI report, there was a 30% chance of at least one more rate hike ahead. Rate cuts were expected to begin in June 2024. Now, markets are pricing-in at least 4 rate CUTS in 2024. Markets are betting that the Fed is done. Source: The Kobeissi Letter
