- Jan 30, 2023
- 4 min read

Adani / New FOMC voters / S&P494 fwd P/E.. / Big CB week / Spain infl much higher in Jan..

Very busy week ahead : early Q4 GDP data, inflation and employment data in EZ, ahead of FOMC Wed (25bps nailed on), ECB (50bps on Thursday (and 50bps more to come) and finally BoE to hike 50bps (and call for a pause most likely, end of hikes near etc)
Swiss KOF Leading Indicator Jan: 97.2 (est 93.4; prevR 91.5), Spain’s inflation unexpectedly edged up in January, breaking a string of five consecutive months of falls, due to higher gasoline prices as the government’s fuel subsidies were scaled back..CPI rose 5.8% (4.7% expected!).. in January on year by European Union-harmonized standards, that's set-up for EZ CPI later on this week
The new 2023 FOMC voters are Harker, Kashkari and Logan, not as hawkish perhaps as the likes of Bullard and George who are going, but definitely not dovish bunch, risk from here is FED makes the market rethink those ''cuts already priced in doe 2023 n '24..''>>> markets have priced in a soft landing and soft Fed since late Sep/early Oct ( #peakusd #peakinflation #peakworries etc) >>> bonds rally, equity markets rally (duration, QQQ etc)..be careful out there, if FED and Co are more hawkish than many think presently
UK Wage Inflation Points to Another Big Rate Hike This Week. Bank of England expected to raise key rate to 4% on Thursday
Market racking up technical points, storyline turns from “Fed tightening into slowdown, S&P caught in downtrend” to “Fed almost done in a firm patch, index working to break trend.” This week will help tell if the shift is real
With or without sanctions, China will try to become self sufficient in semiconductors. After all, it has been upfront about its pursuit of self sufficiency/dominance in all key technologies. The West can influence the speed at which China gets there, not its commitment / Greg Yip
The balance sheet of the Bank of Japan is approaching 140% of GDP (from 110% early last year)
Total German retail deposits rose to €2.71tn at end-2022, another all-time-high
"Once inflation goes above 5%, it has never come back down without the Fed Funds Rate exceeding the CPI” Stanley Druckenmiller
Jerome Powell’s China problem is just beginning-China’s reopening threatens second global inflation wave that Fed won’t be able to contain without causing a recession

Markets :

NASDAQ taking on trendline and 200dma (we've rallied well over 10pct in last 3weeks..), SPX500 went through those resistance levels last week, beware timing (just before Fed and CB meetings - short covering mostly?)>>> S&P494 fwd P/E ? see below, you don't want to own the big boys in reality
USD has remained soft, making only marginal new lows in last week or so, trend is lower, BUT beware Jan positioning turnaround in new month & CB meetings
UST's same as above, let's take 10's, probably a floor around 3.40/3.50% area, steepeners will come back into fashion if FED reinforces the hawkish side
Commods had a strong month on China reopening story, Crude WTI stead around $80