Quarterly Outlook
Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?
John J. Hardy
Global Head of Trader Strategy
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Morning Brew April 9 2024
Erik Schafhauser
Senior Relationship Manager
Summary: Waiting for the CPI
Good morning,
While markets wait for the US CPI tomorrow, there seems to be a massive lack of inspiration. US Equity dropped below 10 billion shares yesterday while indexes were hibernating. I do not recall a day where the big three US Indexes closed less 0.1% from the open
Most interesting larger stock was Tesla which gained almost 5% after announcing to launch the Robotaxi in August and Crypto stocks such as Coinbase and MicroStrategy.
Yields remained high with the 10-Year above 4.4% and traders price in less than 3 cuts at 60 basis points. There is only a 50% chance of cut in June and July is 90%.
The USD Index gave up a little ground, EURUSD is 1.0857, GBPUSD 1.2657 and USDJPY 151.85. Bitcoin and Ethereum rose to 71150 and 3687.
Gold, Silver and Copper seem unstoppable at 3345, 27.95 and 426. Noteworthy is that the implied volatility or Silver is trading at the highest since the banking crises last year. The 1 month is at 30%. While that makes selling options rather attractive but remember that the price is already up 17% for the year and 27% off the low so be sure to consider the risks.
Today is a day devoid of significant releases or planned speeches, it will either be a very slow day, or we will see fast moves when traders position themselves. Tomorrow the CPI Will be in focus, and it is likely to cause sharp moves. The Core is seen at 3.7% and the non-core at 3.4%.
Non-scheduled event risks remain severe from Ukraine, the middle east and Sino-US trade frictions. don’t be complacent.
Wednesday
- Data AU Rate decision, US CPI, Golsbee speaks, Fed minutes,
Thursday
- Data China M2, CPI and PPI, ECB Rate, US Initial Jobless Claims, PPI, Feds Collins, and Bostic speaks.
Friday
- Data China Trade Balance, DE&SWE&FR CPI, US Import Prices Bostic and Daly speak.
- Earnings: Blackrock, JP Morgan, Wells Fargo, State Street, Citigroup
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