ISM US manufacturing and services employment has simultaneously contracted for 3 consecutive months.
Over the last 20 years, this has happened ONLY twice, during the 2020 pandemic and 2008 Financial Crisis. More than 800 companies from manufacturing and services sectors claim that employment is falling. Meanwhile, according to US jobs data, the US job market has never been stronger. Are we going to see meaningful deterioration in jobs data in the coming months? Source: The Kobeissi Letter
GS: much of the remaining hot price inflation is also lagged catch-up inflation.
This applies to housing, health care, and car insurance and other regulated prices Mike Zaccardi, CFA, CMT
Stagflation fears are back.
Source: BofA Global Research; Mike Zaccardi
US Stock Market Capitalization as % of GDP...
1984: 42% 1994: 63% 2004: 93% 2014: 114% 2024: 187% Source: Charlie Bilello
Odds of a September 2024 rate cut jump to 53% after the weaker than expected jobs report, according to Kalshi.
The base case now shows TWO interest rate cuts in 2024, up from ONE prior to the report. On Wednesday, Fed Chair Powell specifically said weakening of the labor market could spur rate cuts. Market implied odds of zero interest rate cuts this year have dropped from 35% to 27%. The Fed rollercoaster ride continues. Source: The Kobeissi Letter
Hong Kong growth beat estimates by the most in 13 years in the first quarter.
Source: David Ingles, Bloomberg
US job openings dropped in March to the lowest level in 3 years.
US available vacancies declined to 8.49 million from 8.81 million in February, hitting the lowest level since March 2021. Job openings have been declining for the past 2 years since the March 2022 peak of 12 million vacancies. Meanwhile, the quits rate has fallen to 2.1%, the lowest since August 2020. This suggests that many currently employed individuals are either losing confidence and/or are more dependent on their jobs. All eyes are on Friday's jobs report. Source: The Kobeissi Letter
The tightest labor market in US history continues to loosen with Job
Openings moving down to 8.49 million (lowest since Feb 2021) and the Quits Rate moving down to 2.1% (lowest since Aug 2020). Source: Charlie Bilello
