Syz the moment

Source: Bank of America

Lockheed Martin $LMT soars to all-time high 📈 Source: Barchart

Equity markets continue to be carried on by a "magic combo": resilient earnings, a weak dollar, weak oil prices, lower bond yields, favorable macro background (growth surprising on the upside / inflation surprising on the downside), a dovish central bank pivot, and now fresh stimulus out of China. This helps the market "climbing the wall of worry", i.e US elections uncertainty,, Middle East tensions, yen carrytrade unwinding, etc. October is historically a volatile month. Let see if the sp500 can continue to rise in a straight line. Source chart: DB

Source: Barchart, CNN

👉 In the US >>> 🚨 Fed Chair Powell Speaks - Monday September ISM Manufacturing data - Tuesday JOLTs Jobs data - Tuesday ADP Nonfarm Employment data - Wednesday Initial Jobless Claims - Thursday 🚨 September Jobs Report - Friday 👉 In the rest of the world >>> 🚨 October OPEC Meeting - Wednesday In Europe, the flash CPIs will continue to come in for Germany and the Eurozone. Highlights in Asia include the Tankan survey and industrial production in Japan, as well as PMIs in China.

People’s Bank of China Gov. Pan Gongsheng announced a flood of support measures in a rare press conference Tuesday amid a deepening economic slump, including the biggest package yet for housing. Measures went beyond most expectations targeted at property, banks and directly, the equity market. Beijing will cut the amount of cash banks need to have on hand, known as the reserve requirement ratio, or RRR, by 50 basis points in the near term, he said. Pan also said the PBOC would cut the 7-day repo rate by 0.2 percentage points, and signaled that a 0.2-0.25% cut in the loan prime rate could follow. Stocks are flying led by brokers and property. Some other China proxies like iron ore and Aussie are also trading higher. Source: David Ingles

On the chart below, the green line is representing the Fed Funds rate - INVERTED, and the yellow line is depicting gold price. Additionally, the white line comparing Gold vs. S&P 500 indicates a potential turnaround after a prolonged period of underperformance. Could the recent outperformance by gold signify the start of a new trend? Source: Bloomberg, Garret Goggin

The long awaited "Fed pivot" has officially begun... By starting their monetarypolicy easing cycle with an aggressive 50 basis points rate cut it seems that the fed decided to focus on the labor market part of their dual mandate rather than the inflation one... Here's a summary of Fed decision: 1. Fed cuts interest rates by 50 bps for first time since 2020 2. Fed sees 2 more 25 basis point rate cuts in 2024 3.Fed governor Miki Bowman dissented in favour of a smaller 25 bps cut. It's the first dissent by a *governor* since 2005. 4. Fed gained "greater confidence" that inflation is moving to 2% 5. Fed will "carefully asses incoming data" and evolve outlook 6. Fed sees 100 bps of rate cuts in 2025 and 50 bps of cuts in 2026 This is a CLEAR Fed pivot and the Fed is signaling that they believe the disinflation trend remains in place but also that they now see making unemployment their top priority as the labor market has weakened. Their decision sounds almost like a risk management one. (Initial) Market reaction >>> -> The SP500 rises to a new all time high but the equity market reaction is rather mixed so far -> Yield curve steepens with a modest yield rise on the long-end -> The dollar weakens Gold and bitcoin slightly rise