Morning 5-28

From Mizuho …

More than 90% of the components in the S&P 500 are currently above their 50-day moving average. The past 11 times this happened, it was higher a year later 10 times and up nearly +16% on average. Overbought is not always bearish. (@RyanDetrick)

The S&P 500 fell 20.0% in Q1, for the worst Q1 in history. The S&P 500 is currently up 17.47% in Q2, which would be the best Q2 quarter in 82 years

The S&P 500 forward PE has risen to above 24, the first time since November 2000. Choose your own acronym: FOMO/MOMO/TINA

In March, Japanese investors bought $36.6 billion of agency debt, the most according to data going back to 1977. Japanese net buying of U.S. corporate bonds jumped to $2.3 billion in March, the most in eight years – Bloomberg.

  Trump to sign executive order on social media on Thursday – White House – Reuters. “Trump’s directive chiefly seeks to embolden federal regulators to rethink a portion of law known as Section 230, according to the two people, who spoke on the condition of anonymity to describe a document that could still evolve and has not been officially signed by the president. That law spares tech companies from being held liable for the comments, videos and other content posted by users on their platforms.” – WaPo …. Trump could narrow this rule so that Social media companies’ protection against such actions might decrease

China /HK

 Chinese lawmakers approved a proposal for new national security legislation in Hong Kong The resolution passed by China’s legislature would allow senior lawmakers in Beijing to write legislation to prevent and punish acts of separatism, subversion, terrorism and foreign interference in Hong Kong. The laws would then be promulgated by the city’s leader. The resolution would also allow mainland Chinese state-security agencies to operate officially in Hong Kong, according to the draft (Pro Farmer). Trump said U.S. will respond by weekend

Economy:

 Jobless claims will likely move above 40 Million over the last 10 weeks, in the markets eye if the trends continue lower not much attention is paid…. Weekly API oil numbers were bearish… Euro at 2-month highs. The Yuan Strengthening today yesterday’s price action almost took currency to an all-time low … Jobless, Durables, second look at GDP and Pending home sales unlikely to move the needle much

Markets:

 Nasdaq a bit heavy, Bunds unchanged, oil steady, NKY closed +2.3%, HK stocks -.72% Italy’s Mib +1.7% Dax +.5% Not a macro theme driving flows so far today each market resp0onding to their own worry or good news…. Watch out for Trump comments on Hong Kong Tech Companies and China

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