🚨Hedge funds are dumping US stocks
Hedge funds sold $2.0 billion in single stocks and ETFs last week, bringing the 4-week average of selling to $0.5 billion. Interestingly, retail sold $0.9 billion, the 1st time in 8 weeks. Institutional investors bought $1.6 billion. Source: Global Markets Investors , BofA
The US just sold $70 billion of 5-year Treasuries.
The Bid-to-Cover ratio was 2.36. Foreign buyers pulled back but US buyers stepped up in record size. Here's the breakdown: • Foreign accounts (called “Indirects”) bought 60.5%. • Domestic institutions (called “Directs”) bought a record 30.7%. • Dealers (big banks) bought only 8.8%, the lowest ever. Now here’s the twist: even though the auction was definitely a poor one, the bond market rallied afterwards. 10-year Treasury yields actually dropped. Why? Because traders were braced for worse. “Not awful” was good enough to spark a rally. Source: StockMarket.news
Despite ballooning debt, scare of Fed independence, tariffs, etc. the market's perception of USA sovereign risk is back at pre-Trump lows.
Source: zerohedge
Trumps Fed power shift in play
➡️ Trump’s push to remove Fed Governor Lisa Cook, could flip the balance of power inside the Fed. If Cook is out, Trump-appointed Governors would hold 4 of 7 seats (excluding Powell). That would give Trump the majority on the board for the first time in history. This shift could open the door to aggressive easing. Cook’s term runs until 2038, making this challenge unprecedented. The Fed has never faced a political reshuffle like this, and the outcome could define the next chapter for US rates and markets. Source: MartyParty @martypartymusic
Marrying two datasets from the Census Bureau and the National Association of Realtors.
This reveals that the median $403,800 sales price of new homes was lower than the $422,400 median price of existing homes nationally as of July. The reason? There’s simply way too many newly completed homes. As of July, the inventory of unsold new homes on the market would take more than nine months to clear, the highest level in 15 years excluding the pandemic, compared to the 4.6-month supply of existing homes. To attract buyers and trim their overflowing inventories, homebuilders are adding discounts to new home deals, like mortgage rate “buydowns” of about 5% on average — even if it hurts their margins. In fact, a record 38% of builders said they cut home prices in July, per the National Association of Home Builders. Source: Quartr
US electricity bills are soaring as datacenters sap more power
Source: MacroEdge @MacroEdgeRes
Foreign central banks now officially hold more gold than US Treasuries — for the first time since 1996.
We might be witnessing one of the most significant global rebalancing we've experienced in recent history, in my view. Source: Tavi Costa, Crescat Capital, Bloomberg
Japan’s top trade negotiator Ryosei Akazawa canceled a trip to the United States on Thursday over issues related to the U.S.-Japan trade deal.
In a statement, Japan’s Chief Cabinet Secretary Yoshimasa Hayashi said that his trip would have involved the discussion of U.S. tariff measures. “However, during the coordination with the US, because it became apparent that certain points required further technical discussion, the trip was cancelled, and it was decided that discussions will continue at the administrative level,” Hayashi told reporters. Japanese media outlet Kyodo News said it has not been decided whether he will reschedule the trip, while Reuters said Akazawa could head to Washington as early next week after the outstanding issues are resolved, citing an anonymous government source. Hayashi said Tokyo will urge the U.S. to amend its presidential order on reciprocal tariffs as soon as possible, and ask Washington to issue a presidential order to lower tariffs on automobiles and auto parts. Source. CNBC
