DC Lite #32

Welcome back to DC Lite: Daily Chartbook’s free, entry-level newsletter containing 5 of the day’s best charts & insights. Upgrade to get all 30 charts.

1. New construction. Housing starts jumped by 14.8% MoM in November (biggest increase in 6 months) to 1.56m while building permits declined more than expected to 1.46m.

2. SPX vs. gold. "The returns of the S&P 500 compared to gold tend to have pretty wild long-term swings, and it's generally pretty correlated to stock over/undervaluation. There are long stretches where stocks outperform gold, but then entire decades where they underperform gold."

3. FMS sentiment. "December FMS investor sentiment improved to its least bearish level since Jan’22."

4. Sector correlations. "Our regular review of US large cap sector correlations suggests that the current rally has 1-2 weeks left to run. Past that, we worry that market optimism will have run too far, too fast."

5. Equal-weight low-to-high. "S&P Equal Weight went from 52-week low to 52-week high in 33 trading days -- only low-to-high cycle that happened faster was at the best bottom of all time, in September 1982."