CTAs are long net $58BN in US equities, just shy of the upper-end of the 5-year range
Could they trigger an acceleration of the equity sell-off if the S&P 500 breaks some key support level? Here are the key levels to watch according to GS: Short-term threshold = 4440 (-1.6%) Medium-term threshold (the most important one) = 4257 (-5.6%) Long-term threshold = 4240 (-6.1%) Source: Goldman
“.. when the S&P 500 is +10% or better YTD at the July-end mark.”
Source: Carl Quintanilla, Bloomberg
Do US cyclical equities look vulnerable given the extent of growth optimism currently priced in vs. the weakness of ISM manufacturing?
Source chart: Goldman
Despite the strong upward move of the Citigroup US economic Surprises index and the strong YTD performance of financial assets, there are signs that things are that rosy for the SU economy
Source: TaviCosta
The average interest rate on US credit card balances has spiked to 20.7%
With data going back to 1994, that's the highest rate we've ever seen. Meanwhile, delinquency rates on credit card loans from small lenders are now at an all time high of 7.1%. That's above the 6.0% peak in 2008 and up sharply from 3.8% in 2020. Source: Charlie Bilello, The Kobeissi Letter
US interest expenses have surged by about 50% in the past year, to nearly $1 trillion on an annualized basis
Source: Lisa Ambramowicz, Bloomberg
Note that US Sovereign risk (aka CDS on 1-year US Treasury) was completely unmoved by the Fitch downgrade.
Source: Bloomberg, www.zerohedge.com
Who is left in the AAA club? (the US is now split-rated AA+)
Source: Jim Bianco, Bloomberg
