Diary of a Financier

Top Newsstuffs (July 17-23)

In Bookshelf on Sun 23 Jul 2017 at 05:55

Top reads from across the past week…

Macro (BULLISH)

Housing permits, starts & completions (June 2017)
by US Government Census

After a string of ugly reports, growth re-accelerated above trend, beating big despite a major upward revision to the prior month; yoy growth could’ve been stronger, considering this one-month reprieve from difficult comps (as expected); this was also a break in multifamily’s collapse, as its cyclical boom has ended (as expected)…
Monthly housing starts:  +4.5pp @ +2.1% yoy, +8.3% mom @ 1.215M saar (beat 1.117e); prior month revised significantly higher
Growth rate: +0.7pp @ +3.9% ytd
Residential investment accounts for 3-5% of US GDP, part of housing’s 15-18% total contribution to growth.
[Previously: The future is still so bright; See also: BAML says housing starts will accelerate & return to historical average in 2016/17 & Homebuilder confidence remains near 11-year highs]
#Bullish $XHB $ITB

 

Credit (NEUTRAL)

 

Fundamentals (BULLISH)

 

Valuations (NEUTRAL)

 

Sentiment (BULLISH)

Retail investor sentiment survey (2017.07.20)
by The American Association of Individual Investors (AAII)

Sentiment spikes up from extremes all the way into neutral territory, although the Neutral cohort remains outsized — a manifestation of the wall of worry…
Bull/Bear ratio: +43bps wow @ 1.38 (above 1.30 historical average, between 1.00 – 1.80 extremes)
Bullish: +7.2pp @ 35.5% (below both 39 avg, between 30 – 45 extremes)
Bearish: -3.8pp @ 25.8% (below 30 avg, between 25 – 40 extremes); back near ytd lows
Neutral: -3.4pp @ 38.7% (above 31 avg); down from near post-Election highs
Measures respondents’ expectation for equity performance over next 6 months (through 12/2017).
[Previously: Retail allocations remain neutral, Institutional allocations remain bullishStrategists’ consensus remains a neutral signal & Quantifying the “wall of worry”]
#Neutral #Contrarian

Technicals (NEUTRAL)

 

 

–Romeo

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