Morning 8-17

  A bit From Bloomberg…. This year, equity indices of just about every stripe have a positive daily correlation with the long bond yield, which isn’t a surprise when you think about it, given the monetary response to the equity crash earlier in the year. But even since April 1, correlations remain positive. It’s true that the correlation of the NYFANG index to the 30-year yield (+0.37) is lower than that of the SPX (+0.60) or Russell (+0.60), but the fact remains price action suggests that higher yields have not been any sort of death sentence for equities. The fun bit of this job is figuring out when that may change, of course. My guess is that we will need to come closer to breaching the top the yield range of the last 4-5 months before the stock market sends up the white flag.

News:

NAHB Home builder confidence Index released early touched a multiyear High  

  • House Dems to hold caucus-wide conf call this morning about bringing House back this wk. to deal with USPS legislation. Bill could be expanded to tackle other coronavirus-related measures (@ChadPergram)
  • The Shanghai Composite added 78.7 points or 2.34% to 3438.8 on Monday as the People’s Bank of China injected 700 billion Yuan to its medium-term facilities, while holding the borrowing cost steady for the fourth month in a row at 2.95%. Meantime, Washington and Beijing postponed a review of their trade deal as China ramps up imports of farm and manufactured goods. A source told Reuters that U.S. officials wanted more time to allow China to increase purchases of US goods. (trading Economics)
  • This week Democratic national convention next week republican not much time to discuss or debate   A new stimulus bill, both chambers of Congress on recess so there that too. it appears that Early September may be the soonest a new bill could be signed…No real worry out of Stocks that a deal will not be signed,
  • The total value of contracts that have not yet been settled on Ethereum futures has hit a new all-time high above $1.5 billion as the decentralized finance space keeps growing, along with demand for ETH. (Crypto today)
  • (Reuters) – Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) said on Friday it has sold shares of some of the largest U.S. banks, slashing its stakes in Wells Fargo & Co (WFC.N) and JPMorgan Chase & Co (JPM.N) and exiting an investment in Goldman Sachs Group Inc (GS.N). In a regulatory filing detailing its U.S.-listed investments as of June 30, Berkshire also disclosed a new 20.9 million share investment worth $563.6 million in Toronto-based Barrick Gold Corp (ABX.TO), one of the world’s largest mining companies

Virus News:

 Spain and Italy told Nightclubs to close France warning that virus indicators trending upwards, India May pass U.S. as worlds hotspot. Iowa state University cases continue to be an example of the difficulty in bringing back students to Dorms… “The 75 students were among 3,472 students tested between Aug. 7 and Thursday, which represents a 2.2% positivity rate, the university said. That is the same positivity rate reported last week when 66 positive cases were found among the 3,037 students tested.  The university reserved two halls for students with positive tests to quarantine or isolate, or they may quarantine at home if they wish, university officials said. (KCCI Des Moines)

NAHB Home builder confidence Index released early touched a multiyear High  

Market:

 Bunds working on a second consecutive higher close today as the mini down draft correcting it itself, Volume anemic so far today. Spoos tight 12 handle range overnight, Silver on the bid 4.9% Platinum +1.5% Gold +1% Copper +1% as Stockpiles held at LME storage facilities drift lower. Zinc traded in China touched a 1 year high and Steel closed at levels last seen in November!   Treasuries a bit higher Nasdaq +.75% U.S. earnings season near completion as this week we get the big retailers WMT, Kohls and target. Dollar drifting lower Bloomberg reporting hedge funds have finally shifted toa short position for the first time in 2 years (Bbg)…Lumber commentary and new stories have gone main stream does this indicate a short term top is In?  We will see a Mid-level OPOEC meeting today So be on lookout for comments.

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