The Daily Shot Brief – October 15th, 2018

By The Daily Shot Brief


The United States: The probability of a recession over the next six months remains modest.

Source: Oxford Economics

Rates: This chart shows who is long and short the two-year Treasury futures.

Source: @ljzaz

China: The rate differential between China and the US has been closing, which has been putting downward pressure on the yuan.

Continue reading The Daily Shot Brief – October 15th, 2018

Sentiment Snapshot: Bonds, Stocks and Macro

By Callum Thomas

The latest results from the weekly surveys on Twitter showed a slight rebound in technicals sentiment, with the all important fundamentals sentiment still holding up well – at least for equities.  This lines up with our optimistic view on the fundamentals and the data pulse which for now is still holding up well.  In contrast to equities, bond market sentiment has seen a notable pullback from extreme bearishness, and ironically this could be just the thing that is required to set up the market for another push higher in bond yields.  With markets in flux, it pays to stay on top of investor sentiment, so check out the charts below and follow us for updates.

The key conclusions on equity and bond market sentiment are:

-Equity “fundamentals” sentiment is still holding up, and now “technicals” sentiment is starting to rebound from deep pessimism.

-Bond market sentiment has seen at least a partial reset both on surveyed sentiment and broader market sentiment.

-The solid readings in the ‘nominal surprise index’ and earnings revisions momentum line up with the optimistic view on the fundamentals outlook, and remains a key swing factor on the overall risk outlook.

1. Equity Fundamentals vs Technicals: The latest weekly survey on Twitter showed a solid rebound in “technicals” sentiment, as investors apparently reassess the risks of a bear market.  Meanwhile fundamentals sentiment has held up fairly steady; not undergoing the same swings as we’ve seen in technicals sentiment.  It speaks to the thesis that this is largely a technical/sentiment driven correction with fundamentals little changed.

Continue reading Sentiment Snapshot: Bonds, Stocks and Macro