Read on the Trading Floor - 12 Jan 2024
Today’s focus… Bank earnings, red sea tensions, ETH > XBT
Macro Themes At Play
Theme 1 - Banks flash warning signs
Theme 2 - Red Sea counter attacks
Theme 3 - Buy the rumour sell the fact?
Theme 4 - The Week Ahead Previews
Further reading and listening of note
Theme 1 - Banks flash warning signs
Choppy Friday session as earnings hit (BoFA dropped more than 2% following their profit warning, JPM +1% on record revenue, Wells Fargo dropped 2.2%), red sea tensions rise in the background (Tesla down 1.5% as they may close their Berlin plant due to supply route disruptions) and of course PPI came in softer than expected (-0.1% MoM vs exp +0.1%). The majority of headline indexes are consolidating into the weekend, SPX 4770, US10s 3.96% and EURUSD 1.0960. One thing that is certain is Jamie's dominance continues on Wall street, with JPM hitting record annual profit and taking a 5th of total US banks profits.
FT - JPMorgan reports record annual profits on interest rate windfall
WSJ - Morgan Stanley Agrees to Pay $249 Million to Settle Block-Trading Probes
FT - Citigroup plans 20,000 job cuts as it reports worst quarter in 15 years
Theme 2 - Red Sea counter attacks
1.5% gain for Crude and Brent as the US/UK alliance strikes back at 60 targets. Where does the conflict go from here? How long before the elevated freight costs enter the consumer basket (3 to 6 month lag?). Outside of the oil volatility the markets assumption seems to be the conflict will pass and not escalate.
Steno Research - US strikes back!
Oilprice.com - Geopolitical Risk Is Rising Once Again
ING - Red sea shipping disruption rages on and the impact will continue well into 2024
ZeroHedge - Houthis Undeterred After US Coalition Pummels Over 60 Targets With Tomahawk Missiles, Airstrikes
- - My Crude Tanker Positioning
Theme 3 - Buy the rumour sell the fact?
Saturday mornings are always lively in the crypto space, it will be interesting to watch tomorrow's activities as the ETF glow passes to ETH. XBT is already testing the low printed post Matrixport report earlier in the week (<45000). Technical analysists will be looking for signals of exhaustion / a blowout top on the weekly candle.
The Lead - Lag Report - The Biggest Winner In The Bitcoin ETF Race?
GoldFix - GS Crypto Weekly: Institutional Need to Know - by VBL
The Last Bear Standing - A Skeptic's Guide to Bitcoin
- - Massive growth potential for the Bitcoin ETFs
Coindesk - BlackRock CEO Larry Fink Backs Ether ETF
Source: tradingeconomics
Theme 4 - The Week Ahead Previews
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Further reading and listening of note
Discovered on Harkster.com
SCMP - On eve of Taiwan elections, PLA warns it will take ‘all necessary measures’ to ‘crush’ separatism
Brent Donnelly am/FX - AUD and SEK
The Boock Report - Wholesale prices benign but is it now old news? Inflation breakeven quietly at highest since mid November
FT - True Detective: Night Country TV review — unnerving anthology series returns to form
Capital Spectator - 10-Year US Treasury Yield ‘Fair Value’ Estimate: 12 January 2024
Seeking Alpha - EV names fall as Hertz hits the gas pedal
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