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    Greg Blotnick – Sidebar

    January 2017
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    • Greg Blotnick – MarketWatch – Hedge Funds February 9, 2017
      Opinion: Investors are dumping hedge funds just when they’re needed most – Greg Blotnick Hedge funds today are about as welcome as a stick in the eye. Endowment funds and pension funds are reducing allocations en masse in favor of indexing and private equity, as outflows reach levels unseen since the financial crisis. Harvard University… […]
      Greg Blotnick
    • Correlations have crashed January 24, 2017
      boon for stock pickers  (per MS) “CORRELATIONS HAVE CRASHED: Editors at Morgan Stanley won’t let analysts use the word ‘crash’ without a good reason and its best way to describe what has happened since election across globe…regional correlations, cross-asset correlations and individual stock and FX correlations have fallen simultaneously. That’s unusual; we haven’t seen a… […]
      Greg Blotnick
    • 1/11/2017 – Macro from RBC January 11, 2017
      McElligott on how “its all the same trade”: The US Dollar is the “grand unifying theory asset” for nearly any and all “profile” global macro or thematic equities trades in the marketplace right now, as it represents investors being long this “new” version of “economic growth.”  As such, performance is significantly tied to the direction… […]
      Greg Blotnick
    • Morning Markets – Dave Lutz – 1/9/17 January 9, 2017
      “Good Morning!   US Futures are starting slightly under pressure, confounding the peeps on CNBC wearing their Dow20,000 hats.   We have pretty much a sea of red across Europe, with the DAX off 55bp in a market that sees Fins and Energy lagging.  Multiple Italian banks are being halted limit down, hitting the MIB for 1.7%… […]
      Greg Blotnick
    • 2017 Forecasts – Stifel, Canaccord January 4, 2017
      Stifel: Our S&P 500 target is 2,400 in 2017 with no recession seen until late 2018 Our S&P 500 target is 2,400 in 2017 with no recession seen until late 2018. The S&P 500 continues to act as if Fed exit began in May 2014 during the QE3 taper and we expect the Fed to… […]
      Greg Blotnick
    • Wisconsin College Using Snapchat to Notify Students of Acceptance December 14, 2016
      UWGB adopts a new way to reach incoming students. Source: UWGB Using Snapchat to Notify Students of Acceptance
      Greg Blotnick
    • McElligott at RBC – Grossing Down December 13, 2016
      RBC Big Picture (Charlie McElligott) – DATA AND TRUMP KICKING-UP ‘ANIMAL SPIRITS,’ AGAINST SIGNS OF Y.E. GROSS-DOWNS –good commentary from Charlie at RBC: OVERNIGHT: Generally higher equities (Estoxx / DAX still holding at highs while Spooz dip ‘red’—highlighting the ‘relative value’ of EU equities against US as they break-out, see Mark Orsley’s piece today) and… […]
      Greg Blotnick
    • CS – “Sticking With Small Over Large” December 8, 2016
      Small caps set to benefit more under Trump administration tax rate the key driver (and lack of foreign revenue) IWM’s “have become a show me story. The main DRIVER supporting small cap is Economic Indicators & Policy, as small tends to lead when real US GDP is 2-3% range. Small caps also benefit from protectionism… […]
      Greg Blotnick
    • OpCo: Revisiting Yield Vehicles In Context of Rising Rates December 7, 2016
      Revisiting Yield Vehicles In Context of Rising Rates & Slower Replacement Cycle
      Greg Blotnick
    • Small caps saw the most PE expansion since April ‘09 – BAML December 6, 2016
      Small caps saw the most PE expansion since April ‘09
      Greg Blotnick

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    Greg Blotnick – What Traders Are Watching 1/6/2017

    Greg Blotnick – WTAW – per Dave Lutz

    YUAN RIPS– China strengthened the renminbi’s trading range on Friday by the most in more than a decade[ft.com] as investors awaited data expected to show Beijing is continuing to burn through its reserves to support the currency.  Following the biggest two-day surge in the offshore version of the renminbi in history, the People’s Bank of China on Friday fixed the midpoint for the onshore market 0.9 per cent stronger at Rmb6.8668 per dollar, the biggest rise since unpegging from the US currency in 2005.

    Goldman Sachs advised clients[bloomberg.com] that the best times to bet against the yuan have tended to be after interventions that flushed out bearish positions, or when China concerns were off traders’ radar screens.

    greg blotnick 1

    greg blotnick 1

    The cost for banks in Hong Kong to borrow yuan from each other overnight soared to 61.3% on Friday, the highest since Jan. 12, 2016[wsj.com].  To bet on a drop in the yuan, investors often “short” the currency by borrowing yuan in Hong Kong, swapping them for dollars and later swapping them back at a more favorable rate. As the cost of borrowing yuan rises, so does the cost of that trade. That can force investors to buy back yuan in Hong Kong, driving the currency higher[wsj.com].

    greg blotnick 3

    The Chinese government is due at the weekend to release data on its December foreign exchange reserve holdings[ft.com]. November’s fall of $70bn in the total — the largest in 10 months — was seen as a sign of rising outflow pressures and sparked debate about how much the PBoC was prepared to burn through to slow the renminbi’s slide.  Bitcoin has been slammed for 17% in the last 2 days on the squeeze

    greg blotnick 2

    All eyes are on[bloomberg.com] China’s foreign-exchange holding data tonight, which will update with last month’s figures on Jan. 7. If they drop below the psychologically-significant $3 trillion threshold, the currency would come under further pressure.  Analysts at Bank of America Merril Lynch expect reserves to dip to $3tn, a drop of $25bn in December – “China can clearly prevent people shorting its currency but can only do so as long as its still large FX reserve pile lasts” said Rabobank[ft.com].

    greg blotnick 4

    greg blotnick 4

    Lotta guys are short the Chinese ADRs as a proxy for being short the Yuan.   JD, NTES, BABA, TAL all ripped higher on the Yuan move.    Chinese Internet Names up ~400bp on average yesterday.  Good timing for MS to do a quick spot secondary in JD.  KWEB, The Chinese Internet ETF, has leapt 6% in last 2 days to the 200dma,

    EMPLOYMENT!Today is Jobs Day, and after ADP / ISM Employment yesterday – expectations for a miss are ramping.  Economists forecast a net gain of 183,000 jobs and an unemployment rate of 4.7%.  “The only reason to expect less than 210,000 [on Friday] is that it’s getting harder and harder to find people to fill the positions that employers have open. It’s a supply issue, not a demand issue,” said analysts at DBS.

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