Daily Chartbook #301

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1. Theft & shoplifting. "Management commentary about theft and shoplifting has increased by 2.5x since pre-Covid levels as cost of living pressures continue to have broadening knock-on effects."

2. Bankruptcies (I). "2023’s total of 516 bankruptcies already surpasses the total filings seen in calendar years 2021 and 2022."

See:

3. Bankruptcies (II). "Bankruptcies are hitting companies with high levels of debt and low earnings in the Consumer Discretionary, Healthcare, and Industrials sectors."

4. Consumer sentiment. "The headline consumer sentiment gauge plunged to 63.0 (67.1 exp) from 68.1, led by a big drop in expectations (from 66.0 to 60.7)."

5. Inflation expectations. "1-year inflation expectations [jumped] to 3.8%, the highest level since May. Five to 10-year expectations moved back up to 3%."

6. Pandemic vs. inflation. "Dividing the components of core inflation to those directly affected by the pandemic and those not, we find that the pandemic effects are over."

7. Gold ETF flows. "2023 has seen net global gold ETF redemptions of 189 metric tons, but the price of gold is still basically unchanged on the year."

8. Managed money vs. gold. "Managed money is back to a largish net short position in gold. The only other times they bet like this, gold: Rallied 30%, rallied 32%, rallied 26%."

9. Gold price. Gold saw its largest daily gain since March and the second-largest since March 2020.

10. US bond flows. US bond funds saw $6.6bn in inflows in the week ending Oct 11, the majority of which went to US Treasuries…

11. Asset class flows. …which led asset class flows and saw the largest inflow since July  (+$6bn).

12. UST outlook. "Most investors seem to think the worst is over for the bond selloff."

13. Stocks vs. rate volatility. "Equities are negatively correlated to the MOVE index."

14. Bullish sentiment. "Bullish sentiment is in the bottom decile for the first time in almost a year."

15. Bull & Bear Indicator. The "BofA Bull & Bear Indicator is a 2.2, signal is Neutral."

16. IPO risk appetite. Institutional investor appetite for IPOs is rising.

17. Global sector flows. "Globally, most sectors saw outflows this week with the exception of Telecoms and Energy, Discretionary; Financials and Tech saw large redemptions this week."

18. EM outflows. EM debt saw its 11th week of outflows (longest streak since November 2022) while EM stocks saw their largest outflow ($4.3bn) since May 2022.

19. Private client flows. "Private clients buying energy, bank loan, growth ETFs, selling staples, utilities, TIPS ETFs past 4 weeks."

20. Private client allocations (I). At 12.3%, private client cash allocations are above the long-term average of 12%.

21. Private client allocations (II). "Cash + T-bills = 15.4% of BofA GWIM AUM vs 13% historic avg."

22. Private client allocations (III). Allocations to equities, meanwhile, have been declining.

23. HFs vs. Staples. "Consumer Staples was the most notionally net sold US sector on the Prime book this week...notional short selling was the largest in 3 months (in the 98th percentile vs. the past 5 years)."

24. Momentum vs. breadth. "Sector-level momentum has picked itself up off the mat, but if breadth cannot get in gear, this is more likely to be a head-fake than the beginning of a widely anticipated Q4 rally."

25. Cap returns. "If the S&P 500 was entirely comprised of the Nifty 7, the SPX would be trading at 8881 today. If it was just microcaps, it would be 3365. And if it was just long bonds, we would be at 2212."

26. Magnificent 7 vs. SPX. "'Magnificent 7' at new high ~30% of S&P 500 market cap."

27. Bottom-up price target. Goldman Sachs' bottom-up price target for S&P 500 companies implies +19% upside over the next 12 months.

28. Sectors vs. domestic revenue. "The overall market is leaning away from the U.S., with domestic revenue share now below 60% and down 3% over the last 5 years."

29. Q3 earnings surprise. Aggregate actual earnings thus far in Q3 (32 companies) have exceeded estimates by 10.1%, which is above the 5- and 10-year averages of 8.5% and 6.6%, respectively.

30. Q3 earnings growth. And finally, the Q3 blended YoY earnings growth rate is 0.4%, which would mark the first quarter of YoY earnings growth for $SPX since Q3 2022.

Have a great weekend!