With the February numbers in the books, let's jump right into the charts! Let's start by looking at the Yield Curve. Yields for most maturities kept rising. The long end (with the 30y/10y and the 30y/5y spreads) continued to invert whereas the short end (with the 2y/1y and the 10y/3m) started to normalize.
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Credit Spreads between Baa and Aaa rated bonds kept falling, indicating a low risk of default and plenty of liquidity in the markets. Mortgage spreads started to normalize after they exceeded the highs of 2008 and 2020.
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While yields have been rising, the Copper/Gold Ratio did not perform as the leading indicator that it is known for and a gap opened up between the two series.
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After peaking in June 2021, the M2 money supply growth rate fell and even turned negative for the first time since 1933. US CPI inflation fell from 9.06% to 6.41%.
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Via Maverick Equity Research we find that the market expects inflation to be 3.44% over the next year and 2.37% over the next 10 years.
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Yields have been rising faster than inflation expectations, causing real yields to rise. This has traditionally been bad for Gold prices. However, since March 2022, Gold didn't budge and proved to be the the safe-haven asset that it is known for, staying at around 1826$ per ounce.
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Bitcoin recovered some of it's losses since the beginning of the year and currently trades at 22,320$.
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Oil has been underperforming Gold in recent months, leading the Oil/Gold Ratio lower.
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Since the beginning of the year, Gold has been outperforming Silver, causing the Gold/Silver Ratio to rise. The US Dollar Index followed accordingly.
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Looking at the individual US stock market sectors year-to-date, 7 out of 11 sectors delivered positive returns. Communication Services and Consumer Discretionary lead the market, while Utilities and Healthcare are lagging.
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Via Maverick Equity Research we examine the S&P 500 in even more granularity, and find the individual 2023 winners and the biggest rebounders from their 52-week low via the price scatterplot.
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Looking at equities internationally, the US stock market continued to underperform the (aggregate) rest of the world in recent months. However, this development was only partially driven by Emerging Markets, which underperformed Developed Markets during the previous month.
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Finally, in a comparison of national stock markets over the past year, Turkey leads the field with +96%, followed by Argentina (+48%), Greece (+25%), Chile (+21%), and Mexico (+16%).
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