An earlier version of this report incorrectly referred to Dan Loeb, founder of hedge fund Third Point. The story has been corrected.
Disappointing retail sales and more debt ceiling talks are the big lights for Tuesday, as stock futures point to a weaker start on Wall Street. There was also some disappointing Chinese data which showed a slow recovery.
The latest Bank of America survey of fund managers is dipping a toe into how investors are feeling these days. Strategist Michael Hartnett and his team revealed that investor sentiment deteriorated in May to “the most bearish in 2023” as investors raised cash balances and became more negative on growth. This is good news, they say – “It is still a paradoxical situation [positive] Wall Street.
Anxious managers are convinced that risky assets will remain “resilient as long as they are.” [economic] The landing is soft.” The BofA chart below shows nearly two-thirds of people surveyed — 63% — see a soft landing as the most likely outcome for the global economy.
And 61% are convinced the Fed is done hiking, while 43% say probably not.
The following chart might explain why the market is taking Alfred E. Neumann’s approach to debt-ceiling talks, baffling some on Wall Street, with 71% expecting the cap to be raised by the alleged X date:
So where are the concerns in this Teflon market? Bank credit crunch and global recession at the top, followed by rising inflation keeping central banks tight.
If there is a credit event, most of those surveyed believe it will start to park in commercial real estate.
As for where this market looks crowded – the past month has seen a significant rotation out of commodities associated with those growth concerns – and into equities. The focus was on tech names, with weight gain the highest since December 2021, along with a move into eurozone stocks. Investors had the longest time growth versus value stocks since July 2020.
No doubt some were wondering if tech stocks could keep up the pace – Nasdaq Composite Composite
It’s still up 18% so far this year, while the S&P 500 SPX
Just over 7%.
For those opponents out there, the trades will be bullish positions on REITs, banks and value stocks, and going in the opposite direction of the public by shorting bonds, technology and growth.
is reading: Why Stock Market Speculators Should Beware of ‘Fake Bear Market Bottoms’
markets
ES00 stock futures
YM00
NQ00
Losing more ground after retail sales data, with BX Treasury yield: TMUBMUSD10Y
BX: TMUBMUSD02Y
Fixed contract and oil prices CL
Modestly higher, DXY dollar
soft, gold GC00
Especially the silver SI00
She is also down. Turkish stocks and USDTRY lira
It continues to weaken due to election tension. XX Chinese stock: 000300
CN: SHCOMP
It took a hit after retail sales and industrial production grew, but below the hopes of Wall Street and youth unemployment hit a record.
is reading: A possible suspension of the US debt ceiling could present an upside risk to the dollar, says BNP Paribas
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uproar
Retail sales rose 0.4% in April, which was lower than expected. Industrial Production will come next at 9:15 am, followed by Business Inventories and Homebuilding Confidence at 10 am.
Starting with this week’s retail earnings, Home Depot HD
The stock fell 4% on failed sales and poor expectations. This also hits Lowe’s LOW stocks.
Blue apron aprn stock
It rose 20% after the recipe-tool maker said it had signed a letter of intent with FreshRealm to funnel up to $50 million in infrastructure assistance.
Horizon Therapeutics HZNP
It fell 16% after a report said the Federal Trade Commission would block Amgen’s AMGN
$27.8 billion purchase of vital medicines. Amgen, whose shares rose slightly, said it was not aware of any decision.
The first-quarter holdings of hedge fund managers and other large investors were floated late Monday. Capital One COF shares
and Bank of New York Mellon BK
BRK fell after Berkshire Hathaway to Warren Buffett
BRK
She said she bought the former and sold the latter. HPQ group raised HPQ
Share, sold from RH to RH
and Taiwan Semiconductor Manufacturing TSM
bets. RH shares fell 4%.
The filings also showed that Soros Fund Management sold its entire stake in Tesla, as well as a significant cut in Rivian RIVN..
This was followed by a Twitter attack by EV CEO Elon Musk who said George Soros “hates humanity”.
Bill Ackman’s Pershing Square took GOOGL’s new alphabet
attitude, and cut Chipotle CMGAnd
Hilton Worldwide HLT
and Lowe’s LOW
bets. David Tepper’s Appaloosa gets his hands on the new Tesla TSLA
and Nvidia NVDA
And they bought FedEx FDXAnd
Amazon AMZN
and other stocks. Dan Loeb’s third point got the new Alibaba BABAAnd
AMD AMD
and alphabet stakes, and get rid of Disney DIS.
Vodafone VOD
United Kingdom: VOD
She said her performance was disappointing and would lead to 11,000 job cuts over three years. Shares fell 6%.
President Joe Biden will meet with Speaker of the House Kevin McCarthy and other US lawmakers to discuss the debt ceiling crisis at a meeting scheduled for 3 p.m.
And we’ll hear from a range of Fed members throughout the day: Fed Vice President of Oversight Michael Barr will testify on Capitol Hill, followed by speeches from Richmond Fed President Thomas Barkin and New York Fed President John Williams, as well as television appearances. By Chicago Fed President Austin Goolsby, who will later participate in a panel discussion with Atlanta Fed President. Raphael Bostick.
Russia launched a fierce attack on the Ukrainian capital, Kiev, on Tuesday.
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