A Few Thoughts:
This chart is from Lorenzo Ippoliti at Ippoliti & Partners and had me thinking over the weekend!
In addition to the S&P 500 and Gold having their highest monthly close in July and 10 year U.S. yields having their lowest monthly close, Lorenzo points out that these three events are occurring at the same time as the U.S. has just experienced the worst quarterly fall in GDP ever and the USD has had it’s worst month in 10 years!
With a week left of vacation to ponder the markets I am focused on:
- Inflation will start to be priced in more aggressively as investors understand that central banks will be slow to hike rates. Good for gold if correct assumption.
- European stocks, having lagged it’s U.S. counterparts, look like they will outperform the U.S. the next few months.
- The spread between Tech stocks and Banking stocks in the U.S. looks like it will narrow in the next few months. As tech feels pricey and the banks seem pretty beat up.
- Seems everyone is negative to the USD and it seems to be a crowded trade, I look for a rebound to squeeze out shorts in the days to come.
- Still like gold and silver buying on dips, for all the same reasons stated previously.
- China/ U.S. relations look to continue to deteriorate in the run up to the election. Watch these developments for possible volatility / risk off consequences.
We enter vacation time in Europe and the U.S. with a great deal of uncertainty due to Pandemic and upcoming elections. I think the macro data coming out the next weeks will be poor and perhaps take some of the shine of the global equity markets. Unemployment in the U.S. on Friday will be important!
|Ticker||Date Opened||Entry Price||Stop||Target Price||Current Price||% Change|
|LONG Austevoll Seafood ASA (AUSS:xosl)||2020/06/02||76.75||72.00||SPREAD TRADE||77.20||+0.59%|
|SHORT Leroy Seafood Group ASA (LSG:xosl)||2020/06/02||56.75||SPREAD TRADE||SPREAD TRADE||54.26||+4.39%|
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