It’s Friday the 13th and if you were looking for someone who just spent a week doing his best impression of a villain from a slasher movie, Donald Trump is the perfect choice.
This week alone he:
- signed a spiteful executive order in an effort to dismantle Obamacare
- suggested he’s going to try and shut down NBC
- renewed his feud with hurricane-ravaged Puerto Rico
- threw the future of the Iran nuclear deal into doubt
Oh, and we also learned he once suggested America should increase its nuclear arsenal “tenfold.”
So yeah… cue the Jason sound effect:
But that didn’t stop stocks which closed at record highs – again. Fifth straight week of gains for the S&P, third for the Nasdaq:
Small caps were the laggard on the week as investors may be rethinking the whole “Trump trade” revival narrative in light of recent events:
The dollar and yields dipped after the CPI miss on Friday:
In case you need a reminder of just how ebullient markets are, here’s Goldman:
Markets continue to be stuck in a low vol regime, which started mid-2016 and became more extreme in the first half of 2017: it is now in its the 16th month. In particular, equity volatility is very low currently and has declined further since the summer and is back towards its cycle lows. The VIX has just made a new all-time low at 9.19 on October 10, 2017 (the VIX only has history since 1990). Also, the S&P 500 is closing in on the longest period since 1928 without a 5% correction (now 329 days, the longest period was 399 days in 1995-96). Valuations across assets are near peak levels, return potential seems more limited and investors are struggling to find investment opportunities. As a result, they are increasingly wondering about a potential pick-up in volatility into year-end, given that, in addition, October will likely see the beginning of the end of the QE era.
And here’s Trump to “explain” how, contrary to reality, that’s reduced the national debt:
First winning week for gold in five:
Trump’s egregious decision on Obamacare subsidies wreaked all kinds of havoc across hospitals and insurers:
And now everyone is going to sue:
jesus. what a fucking train wreck.
20 States Join Suit Over Insurance Subsidies: Calif. AG Becerra
— Walter White (@heisenbergrpt) October 13, 2017
Tough day for drug distributors which fell on news of an upcoming CBS’ “60 Minutes” special (to run on October 15) about the role big drug distributors have played in the opioid crisis:
China’s trade data for September was a positive and seemed to add further support to the notion that the global economy is on decently sound footing. Exports missed estimates, but still looked resilient while imports notched their fastest growth since March.
Notably, iron ore imports rose above 100 million metric tons, hitting a record:
That lifted steel makers and iron ore producers in U.S.:
The Nikkei capped off a nine-day winning streak to close above 21,000 for the first time since November 1996:
This is the best streak since December of last year:
Consider this from Bloomberg recapping Friday’s action:
Fast Retailing Co., which accounts for about 6.5 percent of the measure, contributed most to its rise, after the company predicted that international sales for its Uniqlo chain will surpass those in Japan this fiscal year and reported the biggest jump in annual earnings in more than a decade on Thursday.
Does that name sound familiar? It should. At the current rate of ETF purchases, the BoJ will own the entire free float within 3 years:
In a true testament to how no one is worried about geopolitics, the won is the best performing currency so far in Q4.
Oh, and make-believe space money surged above $5,800:
If you’re a part of that, just know that Dimon thinks you’ll end up getting what you deserve…