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BREAKING: The S&P 500 falls toward 5100 for the first time since April 9th, when the 90-day tariff pause was announced.
You know something is wrong when the Dow is down -1,200 points and it’s barely making headlines.
Markets are pricing-out trade deals as we speak. https://t.co/uKMAEZLpag
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BREAKING: The S&P 500 falls toward 5100 for the first time since April 9th, when the 90-day tariff pause was announced.
You know something is wrong when the Dow is down -1,200 points and it’s barely making headlines.
Markets are pricing-out trade deals as we speak. https://t.co/uKMAEZLpag
Where are the trade deals?
The S&P 500 has now erased -$2.5 TRILLION since the April 9th high after the 90-day tariff "pause."
While markets await trade deals, Japan just said they "won't just keep conceding" in US tariff talks.
Here's what's happening.
(a thread) https://t.co/gFSoMzrbrA tweet
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Current situation:
1. Stocks are falling like the trade war is escalating
2. The US Dollar is falling like trade deals are near
3. Oil prices are falling like rate cuts are not coming
4. Gold prices are rising like rate cuts are on the way
5. Tech stocks are falling like we are entering a recession
6. Treasury yields are rising like the economy is strong
The market no longer knows what to believe.
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Current situation:
1. Stocks are falling like the trade war is escalating
2. The US Dollar is falling like trade deals are near
3. Oil prices are falling like rate cuts are not coming
4. Gold prices are rising like rate cuts are on the way
5. Tech stocks are falling like we are entering a recession
6. Treasury yields are rising like the economy is strong
The market no longer knows what to believe.
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The Kobeissi Letter
China is doubling down:
China has just announced that they will be pulling back from US private equity investments.
Chinese state-backed funds are halting new investments in US PE firms due to government pressure.
According to PE executives, funds like China Investment Corporation (CIC) have already begun withdrawing planned commitments.
Chinese investors are also avoiding US-linked deals, even when managed by non-US based PE funds.
Just 24 hours ago, China warned they would retaliate against countries that cooperate with the US in ways that compromise their interests.
It's very clear what's happening here:
China is seeking to isolate the US through trade and investment.
The US-China trade war just escalated to a new level.
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China is doubling down:
China has just announced that they will be pulling back from US private equity investments.
Chinese state-backed funds are halting new investments in US PE firms due to government pressure.
According to PE executives, funds like China Investment Corporation (CIC) have already begun withdrawing planned commitments.
Chinese investors are also avoiding US-linked deals, even when managed by non-US based PE funds.
Just 24 hours ago, China warned they would retaliate against countries that cooperate with the US in ways that compromise their interests.
It's very clear what's happening here:
China is seeking to isolate the US through trade and investment.
The US-China trade war just escalated to a new level.
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Investors are piling into gold funds like never before:
Gold funds posted a record ~$8 billion in net inflows last week.
This is double the record weekly inflows seen during the 2020 pandemic.
As a result, the 4-week moving average of inflows jumped to ~$4 billion, also an all-time high.
Gold prices have now rallied 29% this year, the best year-to-date gain since 1974.
In fact, in less than 5 months, gold has already exceeded its 27% return seen in 2024.
Gold is making history.
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Investors are piling into gold funds like never before:
Gold funds posted a record ~$8 billion in net inflows last week.
This is double the record weekly inflows seen during the 2020 pandemic.
As a result, the 4-week moving average of inflows jumped to ~$4 billion, also an all-time high.
Gold prices have now rallied 29% this year, the best year-to-date gain since 1974.
In fact, in less than 5 months, gold has already exceeded its 27% return seen in 2024.
Gold is making history.
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BREAKING: The median US monthly housing payment rises another 2.5% year-over-year to a record $2,819/mo.
Home payments have now surged by ~$570/month, or 25%, over the last 3 years.
The increase was driven by a combination of rising median home prices and rising interest rates.
The median home sales price increased 2.6% year-over-year, to $387,000, to its highest since August 2024.
Meanwhile, mortgage rates are rising back above 7% as treasury yields surge.
The housing market remains historically expensive.
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BREAKING: The median US monthly housing payment rises another 2.5% year-over-year to a record $2,819/mo.
Home payments have now surged by ~$570/month, or 25%, over the last 3 years.
The increase was driven by a combination of rising median home prices and rising interest rates.
The median home sales price increased 2.6% year-over-year, to $387,000, to its highest since August 2024.
Meanwhile, mortgage rates are rising back above 7% as treasury yields surge.
The housing market remains historically expensive.
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Appetite for leverage is historically high:
Global leveraged equity funds attracted a record $14 billion in net inflows 2 weeks ago.
This is nearly TRIPLE the previous high posted during the 2020 pandemic.
Last week alone, US leveraged long ETFs saw a record $6.6 billion in inflows.
At the same time, the 3x leveraged Nasdaq 100 long ETF, $TQQQ, took in a whopping $2.3 billion.
The majority of inflows were driven by retail investors.
Record leverage will drive more volatility.
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Appetite for leverage is historically high:
Global leveraged equity funds attracted a record $14 billion in net inflows 2 weeks ago.
This is nearly TRIPLE the previous high posted during the 2020 pandemic.
Last week alone, US leveraged long ETFs saw a record $6.6 billion in inflows.
At the same time, the 3x leveraged Nasdaq 100 long ETF, $TQQQ, took in a whopping $2.3 billion.
The majority of inflows were driven by retail investors.
Record leverage will drive more volatility.
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US manufacturing activity is set to decline further:
The ISM Manufacturing PMI index decreased 1.3 points in March, to 49.0, falling back into contraction after 2 months of expansion.
The employment index dropped 2.9 points, to 44.7, the lowest since September 2024.
The new orders index fell 3.4 points, to 45.2, the lowest since August 2024.
The new orders to inventory ratio declined sharply to 0.85, near the lowest since the 2020 pandemic, suggesting further manufacturing activity contraction.
All while prices paid spiked 7.0 points, to 69.4, the highest since June 2022.
Stagflation is here.
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US manufacturing activity is set to decline further:
The ISM Manufacturing PMI index decreased 1.3 points in March, to 49.0, falling back into contraction after 2 months of expansion.
The employment index dropped 2.9 points, to 44.7, the lowest since September 2024.
The new orders index fell 3.4 points, to 45.2, the lowest since August 2024.
The new orders to inventory ratio declined sharply to 0.85, near the lowest since the 2020 pandemic, suggesting further manufacturing activity contraction.
All while prices paid spiked 7.0 points, to 69.4, the highest since June 2022.
Stagflation is here.
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BREAKING: Japan's Finance Minster Kato and US Treasury Secretary Bessent are arranging a meeting to discuss "forex issues."
This comes as the US Dollar just fell to a 52-week low on tariff worries.
"Currency manipulation" was the #1 item on President Trump's "non-tariff cheating" list.
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BREAKING: Japan's Finance Minster Kato and US Treasury Secretary Bessent are arranging a meeting to discuss "forex issues."
This comes as the US Dollar just fell to a 52-week low on tariff worries.
"Currency manipulation" was the #1 item on President Trump's "non-tariff cheating" list.
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Another day, another record high for gold.
$3,500/oz is just hours away at this rate.
Gold prices are now up +47% over the last 12 months. https://t.co/7nd0nXRAWe
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Another day, another record high for gold.
$3,500/oz is just hours away at this rate.
Gold prices are now up +47% over the last 12 months. https://t.co/7nd0nXRAWe
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Are corporate insiders starting to buy again?
The ratio of companies where insiders purchased their own stock versus sold rose to 0.42 in April, the highest in 16 months.
In the first 2 weeks of April, 180 corporate insiders purchased their stock while 451 sold.
Over the last 30 days, 478 insiders bought while 1,041 insiders sold, bringing the ratio up to 0.46, according to Washington Service data.
However, the ratio of buyers to sellers is still more than 50% below the 1.0 recorded during the 2022 bear market.
Executives are showing some signs of bullishness.
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Are corporate insiders starting to buy again?
The ratio of companies where insiders purchased their own stock versus sold rose to 0.42 in April, the highest in 16 months.
In the first 2 weeks of April, 180 corporate insiders purchased their stock while 451 sold.
Over the last 30 days, 478 insiders bought while 1,041 insiders sold, bringing the ratio up to 0.46, according to Washington Service data.
However, the ratio of buyers to sellers is still more than 50% below the 1.0 recorded during the 2022 bear market.
Executives are showing some signs of bullishness.
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