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Hawkish Fed and a Rally With No Legs


The S&P closed flat (with small caps and the Dow still dropping -0.4%) in absence of follow up to Tuesday’s biggest one-day short squeeze since March after the Fed issued more hawkish than expected Fed minutes. With the exception of banks which managed a small bounce, most sectors traded lower in particular home builders which dropped another -1.9% (-9.1% MTD and -21% YTD) and retailers which dropped -1.4% (-6.5% MTD) as well, suggesting weakness in two important sectors of the economy. After calling the Fed “crazy,” “loco,” “ridiculous,” and “too cute.”, D. Trump called the Fed its biggest “enemy”, on Tuesday, throwing more doubts about his credibility as a defender of the Fed’s independence. There is little doubt that the President will do everything in his power to ensure the market does not make him look bad... by going down given that he got used to identify the success of his policies to that of the stock market in daily self-congratulating tweets. The dollar rose slightly and oil fell 3% on some larger than expected inventories and after D Trump said he did not want to abandon Saudi Arabia over the disappearance of journalist Jamal Khashoggi, alleviating earlier concerns about Saudi’s threatening to retaliate and sent oil sharply higher. D. Trump said that he needs to see evidence to prove Turkish claims that he was killed by Saudi agents as he echoed the Saudi thesis of “rogue” killers. ZH and NYT had this to say about the issue and it is difficult to say what is going to be the “roguest” between the killers and the negationists of the gruel and troubling details of the “rogue” killers provided by Turkish Intelligence. The consequences of this assassination are in our view considerably underestimated for the stability of alliances in the Middle East and for the policy of D. Trump including sanctions against Iran. The Turkish lira rallied 2% while most EM currencies corrected amidst hawkish Fed minutes. ————- This is a delayed and abbreviated version of our premium subscription-based report sent by email to our subscribers every day prior to Asian Markets Closing by 5AM CET time. For a timely and detailed update on global markets, a comprehensive suite of market reports and a briefing of our tactical model portfolios positioning, consider our premium research. Discounts may apply for all private (USD500/year) and professional (USD2’000/year) subscription plans. We help you know when to run and when to sit by tracking all established or developing trends on all major asset classes and by flagging all statistically meaningful market breakouts or trend breaches. To join our 2 weeks free trial, simply click the link below. You won’t regret it! https://www.bentinpartners.ch/subscribe ————- Important Disclaimer: © Copyright by BentinPartner llc. This blog is not intended as a recommendation, an offer or solicitation for the purchase or sale of any security or underlying asset referenced herein or investment advice. Investors should seek financial advice regarding the suitability of any investment strategy based on their objectives, financial situation, investment horizon and particular needs. This blog does not include information tailored to any particular investor. It has been prepared without any regard to the specific investment objectives, financial situation or particular needs of any person who receives this report. Accordingly, the opinions discussed in this blog may not be suitable for all investors. You should not consider any of the content in this report as legal, tax or financial advice. The data and analysis contained herein are provided "as is" and without warranty of any kind. BentinPartner llc, its employees, or any third party shall not have any liability for any loss sustained by anyone who has relied on the information contained in any publication published by BentinPartner llc. The content and views expressed in this report represents the opinions of Marc Bentin and should not be construed as guarantee of performance with respect to any referenced sector. We remind you that past performance is not necessarily indicative of future results. Although BentinPartner llc believes the information and content included in this report have been obtained from sources considered reliable, no representation or warranty, express or implied, is provided in relation to the accuracy, completeness or reliability of such information. This blog is also not intended to be a complete statement or summary of the industries, markets or developments referred to in the blog. #DollarIndex @federalreserve #ForexMarket #ForexNews #USD #USTreasuries #TradeWars #Markets


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