* We're back to the period where we're uncertain which way it goes again - the good news from overnight's jobs report is that overall the US economy remains resilient despite possible private sector recession, the bad news is that the market has over-imputed rate cuts for remaining of the year; Ed Yardeni says there won't be further rate cuts while Lawrence Summers says the Fed made a big mistake cutting 50bps.
* Nonetheless, a good jobs report coupled with Biden's urging Israel not to target Iranian oil assets put a rocket under the US market, driving Dow +341pts and S&P500 +0.9% to 5751. https://x.com/unusual_whales/status/1842293616733237632
* Oil however doesn't believe Biden - Brent Crude rose +0.55% to $78 while WTI at $75, Biden suggesting that "If I were in their shoes, I'd be thinking about other alternatives than striking oil fields" - clearly it implies that Bibi is not aligned with Biden on this, Biden does not want oil fields to be targeted for political reasons nor nuclear facilities to avoid escalation, but we know Bibi is never content (is he?). We shall see, in spite of markets taking Biden's words literally and being prematurely presumptive.
* Silver made an intra-day all time high of $32.96 but dropped just as quickly as it rose, closing back below $32.50 at $32.20, but looks like a silver run is around the corner ( more silver play options in US - SIVR (US Silver ETF), First Majestic (AG), Wheaton Precious Metals (WPM), PAAS, Vizsla Silver (VZLA), and on ASX, looking at Andean Silver (ASL) and WCN )
* Lithium stocks had a good run in US overnight on the back of Rio Tinto's discussion to acquire Arcadium Lithium (ALTM) - prompting ALTM to close +10% higher and jumping +35% in after hours trade.
* As for the stunning jobs report again, remember when I told you Govt spending and employment mask the extent of the private sector recession, here you have it, but never mind, the market wants to bathe in the good headline news not the nuances. https://x.com/zerohedge/status/1842244075052835301
SEPTEMBER PAYROLLS COULD BE REVISED LOWER The surprising increase in payrolls is likely to be revised lower, Pantheon's Samuel Tombs says in a note about today's 254,000 print, an increase from August's 159,000 that beat estimates of 150,000. The spike "goes against the grain of a wide range of indicators pointing to a continued pullback in hiring," Tombs says, adding that only 62% of the businesses in the sample filed responses on time for the estimate, down from 68% a year ago. "We think that small businesses are disproportionately late responders and are cutting back on hiring more than large businesses." https://x.com/DeItaone/status/1842197196608782719 'Good' News Sparks Bond Bloodbath; Dollar & Oil Soar On Week
by Zero Hedge
Saturday, Oct 05, 2024 - 06:00 AM
Is good news, good news? Capping off a week of positive macro surprises, payrolls slipped into the goldilocks dress and spoiled the dovish party for many...
US Macro is at its highest since April, having flipped positive this week... Source: Bloomberg
Rate-cut expectations have plunged (hawkishly)... Source: Bloomberg
... and Treasury yields have exploded higher (2Y +22bps today, 30Y +9bps). 2Y yields are up over 36bps on the week as the curve flattened dramatically... Source: Bloomberg
...with 10Y Yield pushing back towards 4.00%... Source: Bloomberg
...and the yield curve (2s10s) bear-flattened dramatically this week, almost back to inverted... Source: Bloomberg
Bond yields caught up to stocks today... Source: Bloomberg
The hawkishness in STIRs and higher rates did not stymie stocks today as they squeezed up to unchanged (with Small Caps ripping today the most but the worst on the week)...
The dollar surged higher today, to its highest close since mid-August. The dollar was up all five days in a row this week for its best week since Sept 2022... Source: Bloomberg
Bitcoin was down on the week, but found support at $60k... Source: Bloomberg
Gold ended the week marginally lower... Source: Bloomberg
Crude oil prices exploded higher this week - the best week since Oct 2022... Source: Bloomberg
Finally, USA sovereign risk refuses to drop... despite 'Goldilocks'... Source: Bloomberg
Something's going on under the hood.
Source: Bloomberg
