All’s well that ends with record closes for the Dow and the S&P.
It’s safe to say all the carbon-based lifeforms tuned out after payrolls (algos will take it from here), so this will be a short one.
It’s useful to pan out to what’s happened since last week’s tech wreck. Between that, the Flynn debacle last Friday, and the tax deal, there are some clear winners and losers – or at least outperformers and underperformers:
Between tax optimism, the averted government shutdown, anticipation of a Fed hike, hope that Trump will move ahead with something on infrastructure in early 2018 and what traders says is a tightening of liquidity related to year-end funding pressures, this was one of the best weeks of the year for the dollar which has risen for five straight sessions, the best run since March:
Here’s where things stand on USDJPY and 10Y yields since last Friday when the Flynn headline triggered a flight to safety:
Here’s a random one thrown in the mix here for absolutely no reason other than to remind you what benefits most from years of central bank largesse:
Oil was higher for a second day on Friday, but still fell for the week. This was the second straight week of declines and the worst week in two months (coming on the heels of the OPEC extensions no less – sell the news):
Tough week for gold, which is sitting at a four month low. Specifically, this was the third straight week of losses and the worst week since May:
Financials outperformed all other industry groups on the Stoxx 600, rallying after the Basel compromise lead to “no significant increase” of overall capital requirements. The SX7P moved above its 200-day, 100-day and 50-day moving averages:
Of course Brexit deal optimism didn’t hurt in Europe either. You can see the Friday bounce in the 50-day chart:
As noted on Friday morning, Hong Kong and mainland shares closed out the week on a positive note and that’s a good sign in light of recent weakness. Notably, H-shares put up their best showing since November 24:
Tencent – which was in the cross hairs amid the global tech wreck – has rebounded 8% over the past two sessions:
And a friendly reminder:
