{"id":1455977,"date":"2024-02-07T21:00:00","date_gmt":"2024-02-08T02:00:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1455977"},"modified":"2024-02-07T21:00:00","modified_gmt":"2024-02-08T02:00:00","slug":"big-tech-bitcoin-bounce-regionals-red-as-flotilla-of-fedspeak-hints-higher-for-longer","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/big-tech-bitcoin-bounce-regionals-red-as-flotilla-of-fedspeak-hints-higher-for-longer\/1455977\/","title":{"rendered":"Big-Tech & Bitcoin Bounce, Regionals Red As Flotilla Of FedSpeak Hints ‘Higher For Longer’"},"content":{"rendered":"

Big-Tech & Bitcoin Bounce, Regionals Red As Flotilla Of FedSpeak Hints ‘Higher For Longer’<\/span><\/p>\n

\n

The buyers are back in banks and big-tech today<\/strong> despite an avalanche of hawkish talk from Fed speakers. An ugly consumer credit print <\/strong>at the end of the day offset the fact that the US trade deficit narrowed last year by the most since 2009<\/strong> as the value of imported goods declined and the services surplus increased.<\/p>\n

The algos only had one think in mind – S&P 500 hitting 5,000… and they managed to get to 4999.89 before the front-running failed.<\/p>\n

<\/a><\/p>\n

Nomura’s Charlie McEllifgott noted that “large investors including real money, continue to indicate they are being forced to \u2018grab into\u2019 beta through futures and\/or index options upside.\u201d<\/strong><\/em><\/p>\n

<\/a><\/p>\n

But, the narrative is clearly being shifted back to ‘higher for longer’.<\/h2>\n

Six Fed speakers today – all saying the same thing – don’t expect cuts any time soon…<\/p>\n

KUGLER: MAY BE APPROPRIATE TO HOLD TARGET RANGE STEADY AT CURRENT LEVEL FOR LONGER<\/strong><\/p>\n

KASHKARI: WE CAN TAKE TIME TO ASSESS DATA BEFORE CUTTING<\/strong>; SEE 2-3 CUTS THIS YEAR AS APPROPRIATE RIGHT NOW<\/p>\n

BARKIN: “IN THE WORLD OF ELEVATED UNCERTAINTY,… IT’S A REASONABLE IDEA TO BE PATIENT”;<\/strong> LOW RESPONSE RATES, REVISIONS MAKE YOU WARY <\/strong>OF DATA<\/p>\n

COLLINS: THERE IS A RISK THAT INFLATION PROGRESS STALLS<\/strong>, REASONABLE CHANCE RATES SETTLE HIGHER VS PRE-PANDEMIC<\/p>\n

Yesterday we had:<\/p>\n

KASHKARI: “WE’RE NOT ALL THE WAY THERE YET”<\/strong> ON INFLATION<\/p>\n

MESTER: EXPECT FED TO GAIN CONFIDENCE TO CUT “LATER THIS YEAR”; POLICY IS IN A GOOD PLACE, MISTAKE TO CUT RATE TOO SOON<\/strong><\/p>\n

And that followed Powell on Sunday who very clearly confirmed that ‘higher for longer’ view (no matter what 60 Minutes editing\/voice-over said).<\/p>\n

As Goldman Sachs’ Nelson Armbrust noted:<\/p>\n

“The economy is stronger than expected, consumption is solid and jobs are very strong. <\/em><\/p>\n

Personally, I have a hard time going along with the narrative of multiple cuts this year with the data at hand. Rates normalization just for the sake of it doesn’t seem enough for me. <\/em><\/strong><\/p>\n

If the economy can sustain higher rates, it might be positive to have more room to cut in the future in case the economy needs a boost.”<\/em><\/p>\n

Of course, all that hawkishness hits the fan if a bank or two collapses…<\/p>\n

COLLINS: OVERALL, I SEE BANKS AS WELL-CAPITALIZED<\/strong><\/p>\n

KASHKARI: WE’RE WATCHING CRE VERY CAREFULLY<\/strong>, CRE ISSUES APPEAR LIMITED TO INDIVIDUAL BANKS<\/p>\n

REMACHE: FED TO WATCH MONEY MARKET CONDITIONS AS RRP USE FALLS<\/strong><\/p>\n

And today was all about NYCB (which is\/was the 35th largest bank in the US) as it oscillated from total failure to heroic resurrection…<\/p>\n

<\/a><\/p>\n

But some context might help…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

The overall Regional Bank index rebounded<\/strong> solidly (but we note that we have seen this kind of rebound three times now in the last week and we’re still a lot lower)… but ended the day lower<\/strong>…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

But the regional bank rebound, and FedSpeak, sent rate-cut expectations (hawkishly) lower…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Nasdaq outperformed on the day, followed closely by the S&P 500. The Dow managed solid gains but Small Caps battled ‘unch’ in the last hour (and lost)…<\/p>\n

<\/a><\/p>\n

The Mag7 soared to new highs today, up 13.5% from January ‘s lows…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

…as the NVDA soared back above $700 again (up $50BN today)…<\/p>\n

<\/a><\/p>\n

Nasdaq’s gains relative to Small Caps have pushed it back up to a notable level…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Before we leave equity-land, with the S&P within an inch of 5,000 and record-er highs, the last time the S&P 500 was at this record high, in Jan 2022, 77% of names were above their 10DMA, 73% above the 50DMA, and 76% above their 200DMA…<\/strong><\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

This time, only around 40% of names are above their 10DMA, less than 60% above their 50DMA and less than 70% above their 200DMA…<\/strong><\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

As @JasonGoepfert noted on X<\/a>, “Since 1928, that’s only happened once before: August 8, 1929.”<\/strong><\/em><\/p>\n

Stocks rallied even with yields being higher today – despite a strong (record size) 10Y auction. The roller-coaster day left yield sup only around 2bps on the day across the curve but 30Y is lagging on the week…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Bitcoin rallied today, back above $44,000 at one-month highs…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

…after the 8th straight day of net inflows into bitcoin ETFs…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Amid all the moves in other assets today, the dollar went absolutely nowhere…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Gold spiked amid bank chaos early on (above $2040) but ended unch…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Oil prices drifted gently higher today after big product draws<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

US NatGas prices dropped below $2 for the first time since Sept 2020…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

Finally, Powell and Biden may have a problem soon as wholesale gasoline prices are ‘high’, suggesting pump prices are going to be heading up soon…<\/strong><\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

…must be those greedy ‘Big Oil’ execs again!!<\/p>\n

Oh, and while you’re celebrating, this analog just keeps chugging along…<\/p>\n

<\/a><\/p>\n

Source: Bloomberg<\/em><\/p>\n

But hey, the nice people on CNBC said ‘buy stocks, this ain’t anything like 1990!’.<\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nWed, 02\/07\/2024 – 16:00<\/span><\/p>\n

\u200bRead More<\/a>\u00a0<\/p>\n

\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Big-Tech & Bitcoin Bounce, Regionals Red As Flotilla Of FedSpeak Hints ‘Higher For Longer’ The buyers are back in banks and big-tech today despite an…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[1],"tags":[],"class_list":["post-1455977","post","type-post","status-publish","format-standard","hentry","category-news","wpcat-1-id"],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pbimBl-66Lv","jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1455977","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1455977"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1455977\/revisions"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1455977"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1455977"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1455977"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}