The Daily Shot: 16-Feb-21
• Energy
• Commodities
• Cryptocurrency
• Equities
• Rates
• Emerging Markets
• China
• Asia – Pacific
• The Eurozone
• Europe
• Canada
• The United States
• Global Developments
• Food for Thought
Energy
1. Frigid weather in parts of the US has been straining the nation’s energy infrastructure.
Source: The Weather Channel
Electricity prices in Texas spiked amid natural gas shortages and windmill problems.
Source: CNN Read full article
Regional natural gas prices have gapped higher.
And NYMEX natural gas futures keep climbing.
2. Cold weather also disrupted refinery operations.
Source: Reuters Read full article
Crack spreads widened sharply.
Source: Bloomberg
Gasoline and diesel prices at the pump will be going up.
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3. Oil prices continue to climb.
Source: @WSJ Read full article
Brent crude is moving deeper into backwardation, which indicates tighter market conditions.
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4. Fracking activity is recovering and is likely to accelerate amid higher prices.
Source: Gavekal Research
5. Global solar and wind share of power generation is expected to keep climbing.
Source: SmartETFs
Solar module prices have been falling as the manufacturing capacity expands.
Source: SmartETFs
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Commodities
1. The recent spike in platinum prices is a blip relative to the gains in palladium in recent years.
2. Copper futures keep rising.
3. Tin prices have gone vertical amid shortages.
Source: Forbes Read full article
Tin inventories are near the lows.
Source: @financialtimes Read full article
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4. US steel price gains have outpaced China’s steel rally.
Source: @financialtimes Read full article
5. Palm oil is testing resistances as inventories drop to a four-year low.
Source: @TheTerminal, Bloomberg Finance L.P.
Source: @WSJ Read full article
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Cryptocurrency
Bitcoin made another run at $50k but held resistance.
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Equities
1. Stock futures point to new records for US indices.
2. S&P 500 earnings are already above the pre-pandemic high, and Goldman expects significant growth this year.
Source: @carlquintanilla
3. Nonetheless, insiders are selling again.
Source: @ISABELNET_SA
4. The rally in US small-caps versus large-caps is not yet confirmed by value versus growth.
Source: BofA Global Research
5. Assuming no bias, shouldn’t the percentage of companies beating earnings estimates be anchored at 50? Analysts have consistently been “underestimating” US corporate earnings.
Source: Deutsche Bank Research
6. The Direxion “work from home” ETF (WFH) has outperformed the tech sector and overall market over the past few months.Â
Source: Koyfin; {h/t}Â Daniel MoskovitsÂ
However, WFH is lagging the travel tech ETF (AWAY) and is slightly ahead of the US global jets ETF (JETS).
Source: Koyfin; {h/t}Â Daniel MoskovitsÂ
Here are the sector weights and return contributions for WFH.
Source: https://www.linkedin.com/in/daniel-moskovits/
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7. The managed care sector is trading at the largest valuation discount relative to the S&P 500 since 2009.
Source: MarketDesk Research
8. 80% of recent IPOs are unprofitable.
Source: BofA Global Research
9. US government checks accelerated Robinhood’s account growth.
Source: BofA Global Research, @Schuldensuehner
10. The public suddenly wants to know about call options.
Source: Tilo Marotz
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Rates
1. Treasury yields continue to climb.
And the copper-to-gold ratio points to further upside.
Source: @TheTerminal, Bloomberg Finance L.P.
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2. US LIBOR is hitting record lows amid abundant liquidity in money markets.
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Emerging Markets
1. India’s exports have rebounded.
Indian wholesale inflation surprised to the upside, and it’s not about food prices (like in 2019).
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2. Indonesia’s trade balance remains in surplus amid robust exports.
Source: ING
3. Israel’s inflation is rebounding.
4. Russia’s industrial production tumbled last month.
5. Colombia’s GDP continues to recover.
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6. Here is a look at Latin America’s equity performance.
Source: Scotiabank Economics
7. Chile and Argentina have the highest external debt as a percent of GDP relative to peers.
Source: Scotiabank Economics
8. EM corporate earnings estimates have fully recovered from the COVID slump.
h/t @SriniSivabalan
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China
1. Barclays expects China’s credit impulse to continue moderating.Â
Source: Barclays Research
2. Housing sales have been outpacing residential construction.
Source: Gavekal Research
3. China’s share of EM equity fund allocations is near record highs.
Source: BofA Global Research
4. China’s holdings of US debt continue to drift lower.
Source: IIF
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Asia – Pacific
1. Here are the contributions to Japan’s quarterly GDP growth.
Source: Pantheon Macroeconomics
2. New Zealand’s home sales dropped in January.
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The Eurozone
1. The euro-area trade surplus hit a record high.
2. Industrial production recovery paused in December.
3. Eurozone’s output gap increased sharply in 2020.
Source: IIF
4. Corporate debt has accelerated over the past year, especially in France (two charts).
Source: TS Lombard
Source: TS Lombard
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5. Greece is stuck in deflation.
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Europe
1. Rising oil prices have benefitted the Norwegian krone.
Source: Nordea Markets
2. This chart shows last year’s changes in industrial production across the EU.
Source: EC Read full article
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Canada
1. The loonie continues to climb vs. USD (highest since early 2018).
2. Housing starts soared last month, hitting the highest level since 2007.
3. December manufacturing sales were stronger than expected.
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The United States
1. How much slack is there in the nation’s economy? Should the updated potential output estimates be trusted?
Source: @Claudia_Sahm
2. The weak M2 money multiplier has coincided with low inflation.
Source: ANZ Research
But additional fiscal support could boost the money multiplier.
Source: ANZ Research
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3. Higher fuel prices point to gains in core inflation.
Source: @jessefelder, @enlundm, @AndreasSteno Read full article
4. Weak business investment in structures has been a drag on the nation’s CapEx growth.
Source: Pantheon Macroeconomics
5. Manufacturing employment has collapsed over the past two decades.
Source: Longview Economics
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Global Developments
1. This chart shows the correlation of real financial assets with inflation since 1950.
Source: BofA Global Research
2. Currency implied volatility has been depressed relative to equities.
Source: @WSJ Read full article
3. Investors have unrealistic expectations for return on equity (purple line shows required RoE).
Source: Natixis
4. Working-age populations in China and Europe are starting to shrink (Japan’s population has been declining for some time).
Source: Longview Economics
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Food for Thought
1. Tech-sector workers represented by unions:
Source: The Economist Read full article
2. Peak social media buzz:
Source: @chartrdaily
3. PC demand:
Source: Statista
4. The most read Wikipedia articles:
Source: Statista
5. Presidential job approval:
Source: The Economist Read full article
6. Changes in greenhouse-gas emissions since 1990:
Source: @business Read full article
7. Africa’s Great Green Wall project:
Source: reddit
8. Alaska’s temperature changes:
Source: @Climatologist49, @AlaskaWx, @jjrennie
9. Reduction in calorie intake increases longevity:
Source: R Weindruch, R L Walford, S Fligiel, D Guthrie Read full article
10. Standing at work:
Source: @BLS_gov Read full article
11. The 2020 spike in murder rate:
Source: Statista
12. Legal status of abortion in Latin America:
Source: The Economist Read full article
13. Money-related relationship challenges (2 charts):
Source: MagnifyMoney Read full article
Source: @magnify_money Read full article
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14. Different types of scans:
Source: SurgMed, Strati Georgopoulos
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