Hawkish FedSpeak Slows US Stocks while the New mantra is 'Don't Sell in May, and Go Away"


Mixed US Data overnight.

  • Macro (ugly wholesale sales print, implied US gasoline demand at decade-lows ex-COVID, GDPNOW up at 4.18%?),
  • Micro (TRIP exposed as M&A premium evaporates exposing reality of tourism business, UBER hinting at consumer pain, SHOP signalled more consumer pain, AFRM cut revenues forecasts as BNPL schemes falter - more consumer pain, TSLA tumbled on DoJ probe of FSD),
  • Geopolitical (Rafah invasion begins).

But perhaps the most important thing was Fedspeak, which continues to lean hawkish with Collins saying:

“The recent upward surprises to activity and inflation suggest the likely need to keep policy at its current level until we have greater confidence that inflation is moving sustainably toward 2%,” Collins said Wednesday at the Massachusetts Institute of Technology.

“The recent data lead me to believe this will take more time than previously thought,” she said.

Which (again) pushed rate-cut expectations lower.

Interestingly, The Dow managed to shrug this off and rose for the sixth straight day while the S&P and Nasdaq ended the day around unch.

Source: Bloomberg

USD up, Gold flat, Bitcoin down (tks to some small ETF outflows) while Oil ran up USD$2 on a surprise crude draw-down and MidEast tensions.

Last, I bet you didn't know this? (Neither did I until I read it myself!)

Finally, don't "Sell in May, and Go Away" this year, according to BofA's technical analysts... because Presidential election years can see big summer rallies...

June-August is the second strongest 3-month period of the year for all years going back to 1928 with the SPX up 65% of the time on an average return of 3.2%.

Source: Bloomberg

In Presidential election years, the SPX is up 75% of the time from June-August on an average return of 7.3%.

So there!

Happy Thursday!

This information contains unsolicited general information only, without regard to any individual’s investment objectives, financial situation or needs. It is not specific advice for any particular investor or trader. Investment in the stock market involves risk.

This information may not take into account your investment objectives or financial situation, and you should obtain advice based on your own individual circumstances before making an investment decision.

This information is made available to you by ANDIKA Pty Ltd ABN 41 117 403 326, a licensed securities and derivatives dealer (AFSL # 297069).

Great! You’ve successfully signed up.

Welcome back! You've successfully signed in.

You've successfully subscribed to Confidential Daily.

Success! Check your email for magic link to sign-in.

Success! Your billing info has been updated.

Your billing was not updated.