✅ 𝗚𝗔𝗦 𝗪𝗲𝗲𝗸𝗹𝘆 𝟮𝗻𝗱-𝟲𝘁𝗵 𝗔𝘂𝗴𝘂𝘀𝘁 𝟮𝟬𝟮𝟭 ✅

𝗔𝗻𝗱 𝘁𝗵𝗲 𝗰𝗼𝗿𝗿𝗲𝗰𝘁𝗶𝗼𝗻 𝘁𝗵𝗮𝘁 𝘀𝗼 𝗺𝗮𝗻𝘆 𝗮𝘄𝗮𝗶𝘁 𝗶𝘀 𝘀𝘁𝘂𝗯𝗯𝗼𝗿𝗻𝗹𝘆 𝘀𝘁𝗶𝗹𝗹 𝗻𝗼𝘁 𝗰𝗼𝗺𝗶𝗻𝗴. 𝗘𝗾𝘂𝗶𝘁𝗶𝗲𝘀 𝗲𝗻𝗱𝗲𝗱 𝘁𝗵𝗲 𝘄𝗲𝗲𝗸 𝗮𝘁 𝗻𝗲𝘄 𝗔𝗧𝗛 𝗮𝗴𝗮𝗶𝗻. 𝗩𝗼𝗹𝗮𝘁𝗶𝗹𝗶𝘁𝘆 𝗶𝘀 𝗻𝗼𝘁 𝘁𝗵𝗲𝗿𝗲. 𝗧𝗵𝗲 𝗿𝗲𝗽𝗼𝗿𝘁𝗶𝗻𝗴 𝘀𝗲𝗮𝘀𝗼𝗻 𝗸𝗲𝗲𝗽𝘀 𝘂𝗻𝘄𝗶𝗻𝗱𝗶𝗻𝗴. 𝗦𝗼 𝗳𝗮𝗿 𝗰𝗹𝗼𝘀𝗲 𝘁𝗼 𝟴𝟬-𝟵𝟬% 𝗼𝗳 𝘁𝗵𝗲 𝗰𝗼𝗺𝗽𝗮𝗻𝗶𝗲𝘀 𝗯𝗲𝗮𝘁 𝗲𝘅𝗽𝗲𝗰𝘁𝗮𝘁𝗶𝗼𝗻𝘀 𝗯𝗼𝘁𝗵 𝗼𝗻 𝘁𝗵𝗲 𝘁𝗼𝗽 𝗹𝗶𝗻𝗲 𝗮𝗻𝗱 𝘁𝗵𝗲 𝗯𝗼𝘁𝘁𝗼𝗺 𝗹𝗶𝗻𝗲.

We saw a few brokers joining the line of houses calling for a correction. Citi expects a 10% drop for instance. Be it valuation, vulnerable season of the year, inflation, Delta Covid variant, etc. – nothing seems to be able to derail equities. Average year-end target for the $SPX500 is around 4200-4300 pts and the index keeps trading above it all the time. Wall of Worry continues.

L𝗮𝘀𝘁 𝘄𝗲𝗲𝗸

👉 CNBC: “The fear over the Delta variant of the Covid-19 virus and the other side of ‘peak everything’ has investors on edge, while the monetary and fiscal support for the economy coupled with historically strong earnings keeps liquidity high,” Canaccord Genuity analyst Tony Dwyer said in a note to clients. That got stocks to fall on Monday. Kind of a same-old-reasons tendency.
👉 On Tuesday the $HOOD (Robinhood Markets Inc.) frenzy started. After ARK Invest bought shares the week before, retail investors started raiding the newly-listed name they mostly use as a trading planform for speculaiton in their meme stocks. $HOOD finished up 24% on Tuesday and added as much as 80% intraday the following day (ended up 50%). You better not short $HOOD 😉
👉 Microsoft was another bluechip to mandate its US employees to vaccinate before the planned reopening their offices this Autumn.
👉 On Wednesday growth worries put pressure on the cyclicals again. Stocks like 3M and Catterpillar led losses. Growth names outperformed as yields fell. Also GM missed expectations in their 2Q21 reports and fell as much as 9%
👉 Pretty much same themes continues into the weekend with Growth and Value trading as the yields and growth worries allowed them to.
👉 On Friday was saw the July NFP reading: “The U.S. economy added 943,000 jobs in July, the Labor Department found. Economists polled by Dow Jones predicted employers would add 845,000 payrolls. The unemployment rate dropped to 5.4%, below the estimate of 5.7%.” (CNBC)
👉 The market clearly liked the reading, stock finished at new ATHs, yields were higher, etc.
👉 𝙀𝙛𝙛𝙚𝙘𝙩𝙞𝙫𝙚 𝙬𝙚𝙚𝙠𝙡𝙮 𝙞𝙣𝙙𝙚𝙭 𝙘𝙝𝙖𝙣𝙜𝙚𝙨: $SPX500 +1%, $NSDQ100 +1%, EuroStoxx600 +1,8%, $GER30 +1,4%, JPN225 +2%.

𝗢𝘁𝗵𝗲𝗿 𝗺𝗮𝗿𝗸𝗲𝘁𝘀 𝗲𝘃𝗲𝗻𝘁𝘀: 👉 𝘽𝙤𝙣𝙙𝙨: the US yield curve (10y-FF) at 130bps, the German curve (10Y Bunds-3M) at 21 bps. EuroArea AAA-rated bonds yield at 23bps. High Yield Spreads at 3,2. 👉 𝘾𝙤𝙢𝙢𝙤𝙙𝙞𝙩𝙞𝙚𝙨 (𝙚𝙭 𝙤𝙞𝙡): $GOLD -2,9% on week. 👉 𝙊𝙞𝙡: -8,1% on week 👉 𝘾𝙪𝙧𝙧𝙚𝙣𝙘𝙞𝙚𝙨: DXY (Dollar Index) +0,7% on week, EURUSD -0,9%.

𝗠𝗮𝗷𝗼𝗿 𝘀𝘁𝗼𝗿𝗶𝗲𝘀 𝗳𝗼𝗿 𝗻𝗲𝘅𝘁 𝘄𝗲𝗲𝗸: 👉 Industrial production figures from the EU due for release on Thursday. 👉 over 1000 U.S. companies, including Disney, eBay, Airbnb, and DoorDash report earnings this week. 👉 The U.S. consumer sentiment report is due on Friday.

Best, GlobalAlphaS

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