A mostly graphical daily curated roundup of the markets and the economy from Nasdaq's IR team.
#marketseverywhere | poor market breadth: "Only 35% of the S&P 500 has managed to outshine the index itself, marking one of the lowest percentages we've witnesses in the past decade." -Keith McCullough
| lack of enthusiasm to put capital to work...markets have traveled far over the last 1.5 years but haven't gone anywhere
* source: JP Morgan
| all eyes on FOMC at 2PM
* source: Piper Sandler
* source: JP Morgan Asset Management
Traders make late dash into bets Fed stays higher for longer -BBG
* source: JP Morgan
| persistent moderate inflation a risk...
"Inflation persistency is also signaled by market-based longer-term inflation expectations, which have been drifting up in both the US and Europe" -JP Morgan
* source: JP Morgan
* source: CNBC
| OTHER THEMES: FOMC decision today, 99% chance of rates unchanged | IPO market to improve? (Instacart = +12% after IPO) | volatility eerily quiet | "this year has been all about owning quality growth stocks" | wide gap between large cap and small cap performance | monetary tightening = equities compete with cash & bonds | oil prices climbing - global economic impact?
-by Shon Wilk, Nasdaq
1) KEY TAKEAWAYS
1) Equities HIGHER / Oil + TYields LOWER | Canadian CPI hotter than expected...
| UAW strike against automakers continues, no resolution / threatens to expand strike
| VIX trading at historic lows, volatility is dead, eerily quiet... | S&P 500 Stock Index Marks 100 Days Without 1.5% Drop, First Time Since 2018 -BBG | Bond market volatility lowest since Fed began tightening campaign -RTRS
DJ +0.4% S&P500 +0.2% Nasdaq +0.1% R2K +0.5% Cdn TSX +0.2%
Stoxx Europe 600 +0.8% APAC stocks LOWER, 10YR TYield = 4.327%
Dollar LOWER, Gold $1,935, WTI -0%, $91; Brent -0%, $94, Bitcoin $27,067
2) Concentration risk is near record highs + biggest stocks are crowded across long onlies...
* source: BofA's Savita
3) Tight lending standards / credit conditions to deteriorate?
| "Recession-tight bank lending standards are also crimping non-bank lending, and corporate bond issuance. Spreads are poised to widen, with credit conditions clearly pointing to a hard landing." -Nancy Lazar, Piper Sandler
* source: Piper Sandler
4) "The valuation gap between the top 7 stocks and SPW is at the highest level since the Tech Bubble" -BofA's Savita
* source: BofA's Savita
5) Eurozone stocks are lagging...
* source: JP Morgan
6) Performance...
* source: JP Morgan
7) FOMC meeting highlight of the week
* source: Grindstone Intelligence
2) ESG, COMPILED BY NATHAN GREENE
First-Time ESG Bond Sellers Face High Bar as Climate Week Runs On - BNN
-Debut issuance as a share of the sustainable bond market has dipped to a record low amid rising borrowing costs, dampening companies’ efforts to raise trillions of dollars needed to tackle climate change.
-First-time issuers around the world have contributed just 21% of the roughly $677 billion raised in sales of new green, social, sustainability and sustainability-linked bonds this year through September 15, the smallest contribution since the inception of the green debt market in 2007.
Leaders of world’s biggest polluting countries skipping UN climate summit - Guardian
-The Climate Ambition Summit has failed to attract the leaders of the two biggest carbon emitters, with neither Joe Biden, the US president, nor Xi Jinping, president of China, attending. Rishi Sunak, the British prime minister, and Emmanuel Macron, the French president, are also missing the gathering.
3) MARKETS, MACRO, CORPORATE NEWS
- US Federal Reserve set to hold rates at 22-year high-FT
- BOJ speculation moves to negative rate policy from yield cap-BBG
- Oil nearing $100 is red flag for Central Banks’ inflation fight-BBG
- UK’s unexpected inflation drop opens prospect of rates pause-BBG
- Global debt pile hits record high of $307tn-FT
- Japan's exports extend declines as China slowdown bites-RTRS
- Odd bond calm loosening Fed squeeze: Mike Dolan-RTRS
- Dollar rally is crushing one of the most popular trades of 2023-BBG
- Yellen, Kanda put spotlight on yen moves ahead of Fed, BOJ-BBG
- China keeps benchmark rates unchanged as economy finds footing-RTRS
- PBOC says policy room is ample as analysts bet on rate cuts-BBG
- Investors temper pessimism on China, bullish tilt remains distant prospect-RTRS
- Key barometer of economic health flashing warning signs China's economy-BI
- UAW eyes next strike targets as parts shortages begin to hit-BBG
- McCarthy plan to avert shutdown dealt twin blows from hardliners-BBG
- House Republicans to hold first Biden impeachment hearing next week-AXIOS
- Biden aides and Saudis explore defense treaty modeled after Asian pacts-NYT
- No evidence that China can make advanced chips ‘at scale,’ US says-BBG
- US and G-7 allies now expect war in Ukraine to drag on for years-BBG
- Biden’s efforts to court India challenged by assassination claim-WP
- EU’s Von Der Leyen says massive China subsidies for EVS requires a probe-BBG
- Uber warns of threat to drivers in ‘hundreds’ of cities under EU gig work plan-FT
- Goldman nears deal to sell Greensky to Sixth Street Group-BBG
- Philip Morris to consider stake sale in biggest pharma unit – WSJ-RTRS
- Cazoo bondholders take steering wheel with $630m debt-for-equity swap-SKY
- Credit Suisse could make substantial losses in H2 - UBS Vice-Chairman-RTRS
- German interior ministry wants to force 5G operators to slash Huawei use-RTRS
- Marketing firm Klaviyo prices IPO shares at $30 each-BBG
- Exxon working on direct air capture CO2, stays out EV charging stations-RTRS
- Total eyeing 50:50 JV with Adani Green-ET
- Billionaire Forrest’s Fortescue to stop using carbon offsets-BBG
- Carmakers' most-exposed parts suppliers stare down $38 billion hole-BBG
- Klaviyo valued at $9.2 billion after pricing IPO above range-CNBC
- Unprecedented Microsoft leak reveals plans for new Xbox systems-AXIOS
- Disney plans to spend $60 billion on parks and cruises-NYT
- CVC gears up for potential listing as soon as November-BBG
About the author
Massud Ghaussy, CFA, is part of Nasdaq's IR Insights team and delivers daily insights that empowers readers to get a sense of the important issues impacting the day's trading.