Equities saw some cooling, the SPX settling -23pts (0.4%) to 5940.
sp’weekly1b
Summary
SPX: we’re net lower for the week by -17pts (0.3%), but weekly momentum remains net positive, and will likely remain so for some weeks. Mr Market will be inclined to cool back to tag last Monday’s gap (starting at 5807), and then resume upward into the summer.
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Looking ahead
Wednesday will see EIA Pet’ report
Earnings: $TGT $TJX $GOOD $BIDU $VFC $WIX $MDT $KNOP $XPEV $SNOW $ZM $AMSC $DOMO $URBN $CLIR $RAMP $BBAR $ENS
On Target…
Target remains l/t horror from the Nov’2021 $242s.
Earnings due early Wed’ should be reasonable.
The concern should price pressures via tariffs, and a broken consumer.
My target… would be $50
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Final note
Its become clear, the Trump admin’ has ZERO intention for significant cuts in spending. Thus… the $2trn deficits will continue, along with >$1trn of interest payments.
Around $9trn of debt needs to be rolled over this year, plus another two of new issuance, of which $1trn will pay for the interest.
The bond market will duly punish Trump, with yields inclined to broadly climb.
Why would anyone not expect the US 10yr yield to eventually break above psy’ 5.00% ? It should be clear… beyond 5.00%, its open air to 7.00%.
Implications for everything… not least in higher interest payments.
Whilst higher yields/rates would be inherently bullish equities (especially the financials), if the move/adjustment happens too quickly (3-12mths, rather than 3-5yrs), then equities would get smashed.
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The ECB fears a great many things… not least gold.
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I mentioned the UK’s Deliveroo and ‘buy now pay later’ a week or so ago.
Its reflective of a populace so broke, they are now buying fast/junk food on credit. Financial… and societal madness.
… as those Pizza bonds are going to ZERO.
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‘America no longer has the “gold standard” symbolic rating that for years signaled to investors that the US was the safest place to park reserves. This could be a hit to overall confidence, yet there is no better alternative than the US. ‘ – Armstrong
Whilst I agree the USA is still superior to almost anywhere else, that sure doesn’t mean I’d consider a US bond as anything but junk, and would instead favour any US listed equity.
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I’d see those holding physical silver… as ‘why would you sell any, this side of 2035?’
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Even the mainstream appear resigned to $4K gold. From there… psy’ 5K. I think 6-7K looks probable next year.
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Geo-political chatter. I shall hold a vain hope that Trump will manage to resist the pressure – not least from the NEOCONS, Israel, and various military companies, to attack Iran.
On a related note…
Dore on Israel/Iran.
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Armstrong on RT.
*RT is banned in the UK. The ISPs have a block – due to a court order, as continued under the Herr Starmer regime.
In any case… Armstrong’s little chat with RT is arguably worth 11mins of your time.
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*I’ve not watched, but I know some of you are fans of Carlson.
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Day two of X vacation
Not posting on the cesspool that is X, really does make for a simpler and lighter work day. Sure… I’m missing out on some stories, but I can live with that.
I’ll probably resume next Tuesday (after the long weekend) with next Saturday being end of the month… as I’ll want to cover the end month settlements.
Goodnight from London