Daily Chartbook #25

Welcome back to Daily Chartbook: market charts, data, research, and insights pulled from various sources around the Internet by a solo retail investor.

1. Green energy materials. Demand for certain green materials could exceed supply by 2030 in large markets. 

2. European energy (I). Natural gas prices in Europe have reached new all-time highs (again) as Russia announces Nord Stream flows will be halted for 3 days next week.

3. European energy (II). Russian gas flows to Europe are already well below their normal range.

4. European energy (III). “Current EU gas storage at almost 80% covers less than 40% of peak demand”.

5. Homebuilder profits. US homebuilders have enjoyed record margins over the last couple of years.

6. Real estate transaction volume by segment. “Through July 2022, transaction volume had dropped by 25% compared to the same period last year, and is expected to remain lower through the remainder of the year”.

7. Home ATM. “Households have been withdrawing home equity at the fastest pace since 2008”.

8. Strong households. Household balance sheets and net worth are healthy, however.

9. Better breadth. The breadth of inflation is coming down. This chart shows the "% of 16 underlying categories with positive mom change".

10. Tailgaiting. How much does going to the game cost with inflation?

11. Strong DXY. The US dollar is having its best year since 1997.

12. Chicago Fed National Activity Index. After two months of negative readings, the index increased to 0.27 in July. Here's the breakdown.

13. Asset check. “All the major asset classes lost ground last week.”

14. YOLO. You only live once, better invest in quality assets.

15. Extreme gap. The value spread—the gap in valuations between cheap and expensive stocks—is widening.

16. Tech stock valuations. Tech stocks are getting pricier as P/E has moved above the 10-year average.

17. Software-as-a-Service. SaaS  “companies are trading at lower multiples than the rest of the tech sector for the first time since at least 2019 (at the median)”.

18. S&P valuations. S&P 500 valuations by sector.

19. Energy vs. Consumer Discretionary. “The consumer discretionary sector is now worth 2.6 times the size of the energy sector, while the latter generates over 5 times more in free cash flow.”

20. Dividend yield by sector. Energy stocks are also paying out the most dividends.

21. Earnings results (I). Mid-caps.

22. Earnings results (II). Small-caps

23. Hedge Fund VIP. The most commonly held stocks by hedge funds have not been performing well (chart = relative to the S&P 500).

24. S&P priorities. “Companies are doing more share buybacks versus investing in their own businesses than any other time in the last 25 years”.

25. Bottom is in (I)? “Stocks have never made new lows after recovering half the bear market”. The S&P has already done this.

26. Bottom is in (II)? Previous 50% (or more) bear market recoveries.

27. Risk on/off. Sentiment has improved from 1 and 3 months ago across most equity-related indicators.

28. Saying vs. Doing. What investors are doing (black, blue) doesn't match up with what investors are saying (red).

29. Exposure plans. And finally, investors may not be selling but according to JPM’s cross-asset survey, they are not looking to increase equity exposure either.