Morning 8-12

A few Things:

  • Goldman Sachs Update US Equity Weightings …Overweight: Maintains IT, Raises Industrials & Utilities Underweight: Health Care, Real Estate, Energy & Materials (Mizuho)
  • Citigroup Global Economic Surprise index highest in years, meaning economic data has surprised to the upside more so then to downside
  • Yesterday’s Gold Move 5th largest over last 20 years BBG
  • Big Volume overnight in Treasuries as Yields continue to move higher 10-year auction today 30s tomorrow. CPI at 7:30 will it follow PPI and prove hotter than Expectations?
  • Rotation from Growth to Value can it continue? Not so far today as Nasdaq +.8% SPX +.7% and Russell +1%
  • Old news U.K.Q2 GDP -20.4% worse since 1955
  • Reuters reports that US high-yield 2020 bond supply reached US$274.804bn on Tuesday afternoon, surpassing the amount raised during the whole of 2019. Tuesday saw bond offerings from Windstream, Post Holdings, Targa Resources, Albertsons Companies, Clearwater Paper, Xenia Hotels, Covanta and Williams Scotsman. The deals took year-to-date issuance past the full year amount raised in 2019, which was US$273.425bn …Another reason for Lower treasuries
  • New Zealand city of Auckland prepares for lockdown as mystery COVID cases emerge – Reuters bank of NZ restarting QE
  • Volatility continues in Silver and Gold as Trading ranges are quite large so far today. I do not think this is a change in the uptrend, it is just a correction. Higher Bond yields likely drawing some of the money out of precious metals. There is too much stimulus and liquidity in the world for Gold and Silver to start a new downtrend. Quite possibly the violent move has caused some margin calls or profit taking on winning Positions

Markets:

  OPEC monthly report Lowers Q4 global oil demand and Q3 output higher. Silver -3.2%, Gold -.3% Platinum -3% palladium -1%. Short gamma issues causing the volatility in Silver??  Oil +.6% but coming off the highs on OPEC news 

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