- Daily Chartbook
- Posts
- Daily Chartbook #266
Daily Chartbook #266
Catch up on the day in 30 charts
Welcome back to Daily Chartbook: the day’s best charts & insights, curated.
1. Affordability. "A homebuyer on a $3,000 monthly budget...has lost $71,000 in purchasing power since August 2022."
2. Homebuilder backlogs. "From 10.7k homes in Q2 2022 to 7.3k homes in Q2 2023."
3. Household balances. "Across all households, median deposit balances are at least 30% higher in July 2023 than they averaged in 2019."
4. Wage growth. "Posted wages grew at a 4.7% annual rate in July, down from 5.8% in April and 8% last July."
5. Labor costs vs.revenue. "At the aggregate S&P 500 index level, labor costs equal 12% of revenues. At the stock level, labor costs equate to 13% of revenues for the median constituent."
6. Jobless claims. "Initial jobless claims declined to 230,000 last week. The more important 4 week average increased to 236,750. Continuing claims, with a one week lag, declined slightly to 1.702 million."
7. Durable goods. "US durable goods orders tumbled 5.2% MoM in July preliminary data [vs. -4% est], the biggest drop since COVID lockdowns."
8. Core capital goods. "The value of core capital goods orders, a proxy for investment in equipment that excludes aircraft and military hardware, increased 0.1% last month."
9. National Activity Index. "Hotter output in July: Chicago Fed Nat'l Activity Index confirms that US economic activity strengthened in start to Q3."
10. Financial conditions. "Regardless of which index you use, financial conditions have eased since Mar 2023. The Fed can't keep hiking forever, but they're worried about inflation reigniting. Hi, rock. I'm a hard place."
11. Q3 GDP. The Atlanta Fed's GDPNow model estimate for Q3 GDP growth moved up to 5.9% from 5.8% on August 16.
12. Oil vs. PCE. "We estimate that the increase in oil prices...will boost core PCE inflation over the next four quarters by about 0.1pp if oil prices remain at their current levels and by another 0.2pp in an upside scenario where oil prices reach $100 by year-end."
13. Treasury ownership. "The Fed and foreigners own 50% of Treasuries outstanding, and foreigners own 28% of IG and HY credit outstanding, so a lot of the additional cash flow created by higher US yields is not boosting US GDP growth."
14. 10y real yield vs. SPX. "Stocks started to sell off when 10y real yields began to rise in late July; a fall is likely to bring some relief to the equity market."
15. Real yield curve vs. liquidity. "A flatter real-yield curve has led to a weaker dollar, and that has been the main driver of this year’s boost to global excess liquidity: the difference between real global money growth and economic growth, denominated in USD."
16. M2. "As of July, M2 money supply contracted by 3.7% year/year (blue) but increased by 12.7% month/month (green) … trend shift depends on timeframe, as it still looks weak in y/y terms (yet rate of change is improving), but good in m/m terms (yet rate of change is worsening)."
17. AAII. "AAII bears > bulls for 1st time in 12 weeks. Crowd continues to move from excessive optimism & toward pessimism."
See:
18. NAAIM. Active manager exposure to the S&P 500 dropped to the lowest level of the year at 34.4 (from 59.9).
19. Mutual funds vs. sectors. "Sector positioning suggests mutual funds remain optimistic about the outlook for economic growth: Financials, Industrials, Energy and Materials represent four of the five most overweight sectors for the average mutual fund."
20. Mutual funds vs. Banks. "While Financials was the most added to sector, funds cut their exposure to Banks."
21. Mutual funds vs. Growth. "Despite shifting away from Growth at the sector level, funds increased their exposure to our sector-neutral long/short growth factor and are now more overweight the factor than at any time since 2014."
22. Mutual funds vs. Mega-cap Tech. "The default underweight position of core and growth funds in the soaring mega-cap tech stocks continues to be the most significant headwind to mutual fund performance."
23. HFs vs. China (I). "This month's notional long selling already exceeds the levels seen in Aug '21 and Jul '15 and is on track to be the largest over the past decade."
24. HFs vs. China (II). "Hedge funds have now reversed all of the cumulative notional net buying in Chinese stocks from Nov '22 to Jan '23 (aka 'the reopening trade')."
25. Average stock correlation. "The S&P 500 average realized stock correlation has experienced a substantial decrease."
26. Small-cap discount. "US small-cap stocks are trading at the widest discount to the overall market since coming out of the tech bubble."
27. SPX vs. peak inversion. "Even if earnings pivot higher, as expected, remember: The S&P 500 already rallied five P/E-points in expectation of exactly that scenario. We must juxtapose this against the ongoing inversion of the yield curve. Sustained rallies in the face of an inverted curve are very rare."
28. Crowded vs. uncrowded. "After beating estimates, uncrowded trades saw a 200 bps performance boost, while crowded trades fell by -60 bps."
29. NTM P/E vs. returns. "Lofty valuations typically mean lackluster returns."
30. AI earnings potential. And finally, “all S&P 500 industry groups could benefit from an AI-driven earnings boost.”
Thanks for reading!
Reply