Futures Flat, Investors Brace for Thursday's Inflation Data
US Futures traded relatively flat on Monday morning with the S&P up 0.01% to 4,228.75 (sitting just below the ATH), the Dow up 0.14% to 34,790, the Nasdaq down 0.10% to 13,753, and the Russell down 0.01% to 2,286.40 as of 8AM. The US10Y yield fell back to 1.58%, while the dollar (DXY) traded flat at 90.12. We saw another mini flash crash in Vix this morning (similar to June 1st) around 7AM, which saw Vix test a low of 15.78 before quickly bouncing back to 16.66.
Over the weekend we saw the G7 come to an agreement on a 15% minimum corporate tax rate, which is expected to be rolled out to the G20 soon. Enforcement of the accord is another story, of course. Yesterday Yellen said she isn't concerned about higher inflation or higher rates in the near future, adding that they're "good for the Fed and US society." Clearly she doesn't understand how the market works and what will happen to asset valuations when the cost of debt rises; don't forget - Yellen was the one who said just a few years ago in 2017 that she doesn't think we'll see another financial crisis in our lifetimes. Needless to say, I don't place too much emphasis on anything she, or Powell for that matter, says.
Later on today around 3PM we'll get the consumer credit report for April, which is expected to fall from the prior print of 25.8B to 22B. But, the main event this week is going to be the US consumer price report on Thursday, which based on the recent spike in used car prices, could reveal a shockingly high print, causing panic over the possibility of hyperinflation/stagflation as early as this year. The Fed, of course, will come out and say it's transitory as rapidly and as many times as possible following the print. That we can be certain of, as they're nothing more than a PR firm for Wall Street imo.
Lastly, Bitcoin bulls are cheering on El Salvador President, Nayib Bukele, for advocating for Bitcoin this weekend in Miami at the largest Bitcoin conference to date, as a legal form of tender for the country. However, according to Goldman, 35% of Hedge Funds (25 CIO's from various hedge funds) see Bitcoin as their "least favorite" investment, while Growth was the "most favorite." Bank of America's global fund manager survey revealed that "long Bitcoin" was the most crowded trade on Wall Street (no surprise there). We're currently sitting at $36,651 and up around 2.35% on the day. I see us potentially retesting the 200DMA in the near term, before a continuation of the downtrend toward 20k.
Over the weekend we saw the G7 come to an agreement on a 15% minimum corporate tax rate, which is expected to be rolled out to the G20 soon. Enforcement of the accord is another story, of course. Yesterday Yellen said she isn't concerned about higher inflation or higher rates in the near future, adding that they're "good for the Fed and US society." Clearly she doesn't understand how the market works and what will happen to asset valuations when the cost of debt rises; don't forget - Yellen was the one who said just a few years ago in 2017 that she doesn't think we'll see another financial crisis in our lifetimes. Needless to say, I don't place too much emphasis on anything she, or Powell for that matter, says.
Later on today around 3PM we'll get the consumer credit report for April, which is expected to fall from the prior print of 25.8B to 22B. But, the main event this week is going to be the US consumer price report on Thursday, which based on the recent spike in used car prices, could reveal a shockingly high print, causing panic over the possibility of hyperinflation/stagflation as early as this year. The Fed, of course, will come out and say it's transitory as rapidly and as many times as possible following the print. That we can be certain of, as they're nothing more than a PR firm for Wall Street imo.
Lastly, Bitcoin bulls are cheering on El Salvador President, Nayib Bukele, for advocating for Bitcoin this weekend in Miami at the largest Bitcoin conference to date, as a legal form of tender for the country. However, according to Goldman, 35% of Hedge Funds (25 CIO's from various hedge funds) see Bitcoin as their "least favorite" investment, while Growth was the "most favorite." Bank of America's global fund manager survey revealed that "long Bitcoin" was the most crowded trade on Wall Street (no surprise there). We're currently sitting at $36,651 and up around 2.35% on the day. I see us potentially retesting the 200DMA in the near term, before a continuation of the downtrend toward 20k.
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