Mene, Mene, Tekel, Upharsin" — "Numbered, numbered, weighed, divided. You have been weighed in the balances and found wanting."

— Book of Daniel, Chapter 5

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** Housekeeping **

This is likely to be the only Daily Quotedian of this week as your editor is heading into a well-deserved, long weekend. Back next week with weekly and daily editions.

Just a few random observations today, starting with yesterday’s US inflation report where the Core CPI number “beat” expectations:

Which is really a bit sarcastic, considering the Core CPI strips out food and energy costs, arguably the two items facing most upside pressure of the coming month from higher oil/gas and fertilizer prices …

But, however government tries to slice, dice and hide it, inflation is picking up again, except in average hourly earnings (which kind of reinforces the stagfkation argument again:

Later today we will get the Producer Price version of the inflation number, where a noticeable pick-up is expected:

Hence, let’s keep this chart in mind, which we have been following together for a few weeks now:

Please note that this chart above is not “chart crime”, even though it uses two different y-axis, because I am warning you of the potential “chart crime”. The importance on the chart above are a) lead and b) direction of the red line, not magnitude.

Onwards…

Nearly simultaneously with the release of the inflation numbers was Mr Ethan Hunt Kevin Warsh confirmed by the Senate as governor of the Fed. A Fed that is expected by one particular US president to lower interest rates, higher inflation or not… Mission Impossible?

Confirmation as next chairman of Mr Hunt Warsh will almost certainly follow later this week.

Some market observations from yesterday …

Semiconductor stocks FINALLY came under pressure … for a few hours:

The S&P 500, which admittedly dropped ‘only’ one percent top to bottom, unlike the SOX above, where the sell-off was in excess of five percent, made nearly the full round trip by market close and has gained additionally in after-hours futures market trading:

Asian stock markets are trading mostly higher this morning, with Japanese and Chinese Mainland stocks leading. One market worth mentioning however, is the Indian stock market, which while flat today has given back nearly five percent over the past few sessions:

The underperformance versus the wider Asian region is becoming very pronounced:

In bond markets, not a lot of good is happening, as yields are moving higher again (we highlighted our suspicion this would happen in our latest weekly Quotedian “To Infinity And Beyond”). The US 10-year yield is at its highest since last July,

and on the longer-term chart is approaching the upper end of its consolidation triangle:

UK 10-year Gilts are at their highest since 2008 on the back of a political starm(er) storm:

Fun fact: Over the past 10 years the UK had six different prime ministers (and possibly a new one in the making right now); Italy had five.

Finally, the copper trade we have been touting seems to be working well already. Here’s the chart of copper futures (1st):

Our preferred mean to invest, for those who cannot hold commodity futures in their portfolio, continues to be the Global X Copper Miner ETF:

Really like this chart. It shows the ratio of iShares TIPS ETF (i.e. inflation-linked bonds) to the iShares 7-10 Year Treasury Bond ETF (i.e. nominal bonds).

The ratio is rising, having broken out of a clear multi-year triangle (red dashed) and now trading at the highest since 2022 (remember what happened back then to inflation?).

In my most simple interpretation, this means that investors are giving preference of inflation-protected bonds over those which are not.

The market has spoken.

Clearly all eyes on China over the next few days - this could turn out (in hindsight as usual) to be history being written.

May the Trend be with you!

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“Alles neu macht der Mai”

— German folk song by Hermann Adam von Kamp (1818)

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Today will be a brief note only, with the main purpose of introducing a new (beta version) of our dashboard.

If you click one the PDF link below to open the Dashboard as, well, uh, PDF, you will note that the document has now expanded from one to three pages. On the additional pages you will find each day which stocks in the STOXX Europe 600 (SXXP - page 2) and the S&P 500 (SPX - page 3) are hitting a new 52-Week High or a new 52-Week Low. The design will improve over the coming days/weeks, but we think this information is for a professional investor like you very valuable. Feel free to leave your feedback in the comment section or sending a message:

Many major benchmark indices, led by the most popular US indices, themselves made not only a fresh 52-week high yesterday, but even a new all-time high.

Take the mighty S&P 500 for example:

Or the as-mighty Nasdaq 100:

Reason? As we outlined in our weekly Quotedian issue published yesterday (Stairs DOWN, Elevator UP), it seems that Greed (aka FOMO) clearly outweighs Fear.

But, you will say, the war, the inflation, the valuation, the Strait of Hormuz, the everything else that is so wrong about this … yes, you’re right, but you’re not. However, let’s leave this conversation for our next weekly Quotedian with the working title “Irrational Exuberance”. Make sure to be signed up to your weekly issue:

GET ME IN!!

Anyway, in the meantime, breadth in yesterday’s advance was solid, not only with nearly double as many companies ending the day up than down, but also with many more stocks reaching new 52-week highs than new 52-week lows (see how useful this new addition is!).

European stocks, which have started to lag recently,

probably due to the larger impact of energy costs, show, spinning it positively, still a greater upside/catch-up potential (SXXP below):

The Asian equity session this morning was solid, with a regional Bloomberg index up over two percent, hitting new all-time highs too:

Strongly contributing to those gains were South Korea’s KOSPI, where the memory-chip maker craze is getting out of hand,

and mainland China stocks:

To finish of in a speedround-like manner, it is noteworthy that all other asset classes are continuing to “play game”, i.e. support the ongoing equity rally by adhering to the correlation which have been true since the outset of the Iran conflict on March 1st in this session. Examples:

Dollar (DXY) weakens:

Bond yields (US 10-year yield) drop:

Gold is up:

Oil is down:

Need something more to worry about? See, chart below, no commentary needed:

Et, voila!

Later today we see the release of the ADP Employment report in the US as a prelude to Friday’s non-farm payroll report.

Earnings season continues in full swing, but other than that, relatively quiet agenda today (exception confirming the rule: Trump’s Social Truth handle).

That’s all for today, folks!

May the Trend be With You!

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"There are only two tragedies in life: one is not getting what one wants, and the other is getting it."

— Oscar Wilde

20260422 Npb Db

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And today’s winner in the category “Be careful what you wish for” is…. drumroll…. longer drumroll….. TADA!!

But with the US President’s vocal-expression-organ and his finger-tips-stuck-on-social-media-apps this was just one announcement communication post “thing” of many yesterday he felt compelled to share with the world yesterday.

For our purposed (making money) probably the immediately most important one came shortly after the market close:

How did the market react? Well, as with anything that becomes a routine, such as TACO TUESDAYS, the marginal propensity of eating yet another TACO on yet another TUESDAY diminished noticeably.

Oil prices, for example, did not go down on the announced ‘permanent ceasefire’, but rather up, showing investors’ main worry being a prolonged closure of the Strait of Hormuz (SoH):

Admittedly, prices have come down to where they were in the meantime, yet, the market knee-jerk reaction is still a tell sign.

Equity markets did jump, but only about half a percentage point right back to where they started worrying about the original deadline approaching:

Zooming out to the daily chart, the S&P 500 can definitely do with a pause after the second fastest move from oversold (RSI <30) to overbought (RSI >70) since 1950, as we had shown in Monday’s weekly Quotedian (“The Spice Must Flow”):

Breadth (advancers/decliners) was about 1:2 on the S&P yesterday, though it is noticable that 28 stocks hit a new 52-week high versus only 4 sitting at new 52-week lows.

For European markets, the 52-Week Hi/Lo ratio was nearly identical even though the STOXX 600 was down nearly a percent:

In Asia, it looks like the Nikkei 225 may be able to close at a new ATH in a few minutes:

Though the broader TOPIX index (1650 stocks) may be signalling a warning with a negative divergence to the Nikkei:

Little to report on the currency and commodity front other than oil which we already covered, so let’s move right on into the next section.

You know I like to say “there’s always a bull market somewhere”, hence with major global benchmarks hardly making any net progress over the past six months, it is satisfying to know you could have been invested in US Micro Cap stocks, which are up 85% over the past 12-months,

beating their mega/large-cap cousins by a wide margin:

Or, there has also been a bull market of note in Chinese ‘venture enterprises, with the ChiNext Index doubling over the past year:

That’s good and nice, you will say, but what is this knowledge worth if you cannot invest into these areas, right? Wrong!

Choose the iShares Microcap ETF (IWC) for US micro cap or the VanEck ChiNext ETF (CNXT) for the Chinese venture stocks.

De nada.

Quiet day ahead in terms of economic data, was nothing meaningful being reported out of the US.

CPI, PPI and RPI have already been reported in the UK a few minutes ago, generally ‘surprising’ to the upside.

Busy on the earnings front though, with ABB, Boeing, GE Vernova, Vertiv, AT&T, ServiceNow, IBM, Kinder Morgan, Lam Research, Tesla and Texas Instruments only a tight selection of a much wider area of names reporting today.

And to finish, we have another winner today, this time in the category “WTF”:

Oh, wait, same guy again …

May the Trend Be With You!!

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“I can calculate the motion of heavenly bodies, but not the madness of people.”

— Sir Isaac Newton

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Stocks inched up yet another day, with the S&P 500 and the Nasdaq both closing at new ATHs. In case of the S&P 500, it was the second close above 7,000:

Whilst the Nasdaq celebrated its 12th(!) CONSECUTIRVE up day:

So, what has provoked this acute outbreak of Bullmonia?

Well, it is kind of a mix of different viruses, with some of the below being the most dominant components:

• Retail buying (aka FOMO)

• CTA buying (aka “Quants”)

• Headline trading (aka Trump watchers, aka TDS (Trump Derangement Syndrome))

• Gear (aka stupidity)

Prove on the latest is the easiest. Consider Allbirds (BIRD), a company providing sneakers, shoes, slip-ons, t-shirts, socks, underwear, bags, hats, and related products, which, out of the blue and announces it plans to ‘pivot its business to AI compute infrastructure’. That’s of course already stupid enough in itself, but was still outdone by the markets’ reaction:

Anyway, keeping this short on a Friday, Asian markets have stopped and slightly reversed the uptrend today, with an index measuring the fortunes of the wider region down about a percent.

This is an outcome I would expect for Western markets today too, as some profit taking should set in after that massive rally over the past two weeks and ahead of the weekend.

Bond yields (US 10-year Treasuries below) continue to trade within their downward slopping consolidation channel and absent any economic data out of the US we do not expect that to change today:

German yields have been more resilient to move lower after the spike and may be coiling up for a renewed break out, which could make sense in that the Eurozone is more affected by the inflationary impact from the closure of the Strait of Hormuz:

In that context, also pay close attention to our COTD below.

Little to report from currency OR commodity markets, other than maybe that copper futures have been moving higher lately, speaking of a strong economy which could exhibit additional upside pressure on stocks and downside pressure on bonds:

Interesting chart here from the fine folks at Barclays Research, showing the correlation of different asset classes and their subindices to the price in oil since the start of the Iran war:

Unsurprisingly, international equity market exhibit the strongest (negative) correlation to oil.

With nothing of importance on the economic and only little (Ericsson, State Street, Truist Financials) on the earnings calendar it is time to clean out the inbox, catch-up on admin, square out some positions and head off into the weekend!

May the Trend be With You!

André

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“In preparing for battle I have always found that plans are useless, but planning is indispensable.”

— Dwight D. Eisenhower

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So, there we are, with the (US) equity market having unwound ALL of its Iran War induced losses - and, since yesterday, and then some! Including yesterday’s two percent plus jump, the S&P 500 is now 1.5% higher than when the war broke out in the first March days:

True, not all international markets enjoy the same recovery (a selection below),

but overall it is fair to say that the market is expecting the ceasefire to turn into a peace treaty and also does not consider the still largely closed Strait of Hormuz (SoH)

to be a longer-term threat.

Well, good luck with that. As we highlight in our latest quarterly NPB CIO Outlook (click here) we are in favour of a short- to medium-term rally, but the longer term consequences of higher oil, fertilizer, helium, plastic, etc. prices should not be underrated… See the Chart-of-the-Day for more on this.

But back to yesterday’s rally, which was healthy not only in absolute progress, but also under the hood. Whilst the advancers-to-decliners ratio on the S&P 500 was ‘only’ 3:2, twenty-four stocks hit a new 52-week high, whilst only two a new 52-week low:

An even better stat on the same hit us out of Europe (SXXP):

Back to US stocks, where small cap stock have been on a 12%-plus tear since March 30, closing less than half a percentage point from a new all-time high (ATH):

Outside equity markets, bond yields are signalling some return to normality (whatever that means in financial markets, especially nowadays). Here’s the US 10-year Treasury yield, which could continue to move lower as equities continue to rally:

4.40% is now the big risk point.

German yields, as proxy for the Eurozone, have also calmed a tad, though remain above 3% for now:

The USD continues to be one of my favourite, structural shorts. Here’s the Dollar Index (DXY):

And don’t look now, but Bitcoin may be up to something naughty:

In the section above I noted that investors should enjoy a short- to medium-term market rally, but should not turn a blind eye on the perils from longer-term impact of the SoH closure.

Point-in-case: Why do you think stocks of food makers have been under substantial pressure, hitting new 52-weeks lows early this week, and barely recovering with the rest of the market?

Yes, exactly. Higher input costs ahead! Watch this space….

Later today:

• US eco data: MBA Mortgage Applications, Empire Manufacturing, Export/Import prices and the glossy magazine that is the Fed’s Beige book

• Earnings: ASML, Helvetia Baloise, M&T Bank Corp, PNC, BofA, Morgan Stanley

May the Trend be with You!

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“The stock market is the only place where things go on sale and everyone runs out of the store screaming.”

— unknown

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What’s up? What’s not up! Another week where we literally get calls for extinctions of an entire civilisation, followed by some heavy TACO eating…

Too much to cover it all in a supposedly short, daily edition, but let’s have a look at some key charts and ideas.

In equity markets, the S&P 500 has bottomed for the medium-term on Monday a week ago (30.3.) and with the price now firmly back above the 200-day AND the 50-day moving average, chances for reaching a new ATH in the near future have increased:

Giving additional confidence that the major indices could be hitting new all-time highs (ATH) soon, is that more cyclical measures, such as the DJ Transport index,

or the Philadelphia Semiconductor index,

have already done so!

However, with earnings season starting next week,

it will be important to see whether CFOs will downgrade their guidance. Analysts have not yet done so (next 12 month earnings estimates, red line),

which could lead to major disappointment.

Mildly surprising, European stocks (SXXP) bottomed out a week earlier (23.3.) than their US peers:

And, noteworthy, did this index never close below its 200-day moving average.

Bond yields (below the US 10-year Treasury version) topped out simultaneously out with the bottom in stocks, which is no surprise, as the entire market has been trading the headlines over the past few weeks as one enormous macro trade:

It follows then, that if stocks bottomed and bond yields topped, the US Dollar now should also have topped out,

and so should have the oil price (Brent):

BINGO on both accounts!

Rapidly back to the greenback though, where the lack of true strength during this major geopolitical crisis confirms our view that more secular weakness lies ahead. We are watching that red dashed line on the Dollar Index (DXY) chart very closely:

Gold (and silver) had been trading with a high positive correlation (R2 0.50 as compared to 5-year average R2 0.02) to stocks during all this Middle East mess, proving it was a liquidity provider after the massive rally over the past few years. We still see gold higher over the next few weeks:

A special mention goes to that “touch ‘n go” on the 200-day moving average!

Later today we will see the release of inflation (CPI) data in the US. Regular readers already know how much I detest this lagging and manipulated number, but still, it will be one that the market looks at for impact of this recent Strait of Hormuz (SoH) crisis. Well, here is what I think they can await over the coming months:

We have more charts with similar path-predictions in our upcoming Q2 outlook.

CPI will be the focus, but there are also Sentiment, Durable Goods orders and some Federal Budget numbers being reported later this (European) afternoon.

Other than that, fade the headlines and stay safe!

Have a great weekend everyone and, of course, May the Trend be with You!

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“The market is a pendulum that forever swings between unsustainable optimism and unjustified pessimism.”

— Benjamin Graham

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And just when you thought that the market is finally on a Zig higher, US President Trump comes with yet another curve ball, and Zag lower it is again.

According to Trump’s address to the nation last night:

• War is "nearing completion"

• Expect "Extremely hard" strikes for 2–3 more weeks

• Regime change claimed but disclaimed — "we never said regime change, but regime change has occurred"

That second bullet point up there sounds a lot like “Boots on the Ground” to come over the next days. But maybe it’s just me…

Separately, in an interview with the Telegraph, he also leashed out against Nato.

The kangaroo market continues.

Hence, we remind ourselves for a third time this week that “never anything good happens below” the 200-day moving average and many major markets continues to trade below that hallmark or are at the cusp of doing so.

With Trump’s address to the nation having taken place after market close, there is little to observe from market internal indicators such as breadth, but of course are (equity) futures markets flashing deep red this morning and Asian markets, with an anyway higher sensitivity to energy price, also in full sell-off mood and mode:

In a nutshell, this morning’s ZAG is stocks lower,

bond yields higher,

oil higher,

US Dollar higher,

and Gold and Silver lower:

That’s the simple to implement but hard to foretell cross-asset macro trade going on at the moment …

Most of you are focused on the headline-grabbing equity markets, and therefore most of you are currently being boxed around by this kangaroo market…

But fret not, you are not alone.

Interest rate investors have gone from incorporating Fed rate cuts, to hike to now unchanged in just three weeks!

ZIG-ZAG … ZOG

Today is the last trading day off the week for nearly all global markets - and it promises to be fun!

Later today we’ll have US Initial and Continuing Claims, followed by tomorrow’s Non-Farm Payroll number.

Not one Easter shall go by without me putting up this silly, stone-age old joke:

Having that said, May the Trend be with You!

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"There are two ways to be fooled. One is to believe what isn't true; the other is to refuse to believe what is true."

— Søren Kierkegaard

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Interesting times … as it has been for the past 15 months or so …

There we wrote on Monday in the weekly edition of the Quotedian how much (equity) markets were on the brink of breaking down and negative global growth taste in our mouths we had not had for … well, about a year since Liberation Day.

Moving on 48 hours, and the charts look pretty constructive again after a massive rally on Tuesday. And this under a scenario that very much reminds me, as I have been discussing with colleagues, of the Eagles classic “Hotel California” song (click here), as Trump is willed to clear victory on Iran, even if the Strait of Hormuz remains closed…

Last thing I remember
I was running for the door
I had to find the passage back
To the place I was before
"Relax, " said the night man
"We are programmed to receive
You can check out any time you like
But you can never leave"

Mind you, despite a nearly 3% rally it has been a dreadful month, not only for the S&P 500,

where it had been the worst month since, well, last March, but also for global key benchmark indices in general:

On the chart, and as forementioned, the yesterday’s rally has helped improve the ‘visual aspect’ of the overall picture, however, it must be noted that we still trade below the 200-day moving average on the S&P 500 and the Nasdaq 100 (not shown):

And immediately following having said that, the S&P 500 equal-weight index managed to close above the key landmark (the 200-day MA that is), after just two closes below it, which has very bullish interpretation potential:

It is also a hint to how broad yesterday’s rally was, with an advance-decline ratio of larger than 5:1

There was really only one sector (with the allowance of utilities) printing proper red yesterday, which was, unsurprisingly so, the energy sector:

European stocks, maybe to the surprise of most of us, actually have one of the most favourable chart pictures, with the STOXX 600 never having closed below its 200-day MA:

Asian markets are, not surprisingly, strongly higher this early Wednesday morning too, lead by a crazy five percent move higher in Japan’s Nikkei 225 index,

and rounded off by an Utopian 9% advance on Korea’s KOSPI:

Turning to bond markets, yields have come down, maybe not a long way, but decently from the intraday highs only last Thursday. Here’s the 10-Year US Treasury yield chart:

And here its German equivalent as a proxy for European yield markets (which had hit their cycle highs on Friday rather than Thursday):

So, as it seems to be not only April Fools’ Day, but also Uno Reverse Card Day,

it follows then that if stocks are higher and bond yields lower, the USD should also be weaker:

BINGO!

It follows then that the Dollar Index (DXY) has been rejected once again at the upper end of its range:

Also, BINGO.

Last but not least, in the commodity space, crude oil (Brent) futures have also come down over the past session,

but given the uncertainty surrounding the opening or not of the Strait of Hormuz remain above the USD100 mark for now. A drop below would be a tell sign of an improving Strait situation.

Gold (red), as mentioned in Monday’s Quotedian (click here), are profiting from now falling real rates (grey, inverted):

And already mentioned two weeks ago (click here), we expect this rally to have legs:

A potential ABC pattern may have terminated, which should take the price of gold first to 4,800 and then 4,920. The longer term picture would suggest a new ATH over the coming months. All bets off below 4,350.

Were oil traders right all that time? Is the conflict (and the closure of the Strait) really only “transitory”.

As shown in the spread between first month and the twelve month futures prices of Brent, traders bet up the price of short-term oil, but were/are confident that 12-months out oil will be much cheaper:

This is known as that famous Backwardation (with Contango being the contrary, where futures prices are higher the further out you go).

If this is conceptually difficult to grasp, here’s a nice chart overlaying those two contracts (grey 1-month, red 12-month), showing the confidence expressed by traders for this to be transitory, with the 12-month price staying way behind the 1-month price:

Couple of “things” out today, with the ADP employment report ahead of Friday's non-farm payroll figures and the ISM readings in the US probably the most important from an economic data point of view.

But, hand on heart, the only item that probably really matters on today’s agenda is Trump addressing the Nation on Iran at 21:00 ET. Unfortunately, this will be 3 a.m. for us in Europe here, but hey, if we stay up for the Super Bowl Final and the Oscars …

With all this said, always remember:

"April 1. This is the day upon which we are reminded of what we are on the other 364."

— Mark Twain

May the Trend be with You (and the jokes light on you).

André

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"Nothing good happens below the 200-day moving average"

— Paul Tudor Jones

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As they say, the first victim of a war is the the truth, and this is of course even more true if modern-day propaganda is magnified by the reach of social media. In this context, it continues to be extremely difficult to separate the noise from signal, let alone actually interpreting the signals themselves …

Hence, it seems yesterday investors’ mantra started changing from FOMO to “When in doubt, sell!”, as risk-off behaviour is becoming increasingly visible.

A quick run-down here, starting with what markets (and apparently Trump, probably under Bessent’s instructions advice) most look at currently, which is the US 10-year Treasury yield:

I have not yet had the time to do the exact work, but it must be a certain ROC (Rate of Change) in the 10-year yield over a short-time frame that has the White House getting nervous and going full TACO. Like yesterday, wen TACO-in-Chief Trump extended the negotiations deadline by another 10 days.

So far, it hasn’t helped a lot, as we can see on the chart above, with the last candle (today) continuing to rise.

Equity markets also took only very short comfort from the expansion of the deadline yesterday:

Also, on the daily chart, the S&P (and other indices) has spent enough time now below the 200-day MA to confirm that market dynamic has changed:

I invite you to scroll back up and read that quote of the day again…

European stocks may be joining in on that party as soon as today:

We expressed our concerns over the Indian equity market yesterday (which was closed on Thursday), as the frequency of news regarding panic fuel buying at the pumps has been increasing. This morning we got confirmation that those concerns are justified, with the BSE500 down 1.6%:

The Dollar is rallying again this morning, but as mentioned yesterday, putting it in perspective, we would have expected for the Greenback to be MUCH stronger at this stage:

And this is probably the best sign of the structural, secular weakness behind the USD.

We also need to mention the European bond market, below proxied via German Bund Futures, which is facing an epic sell-off as yields are heading towards 3.10% this morning:

Finally, oil is NOT indicating that a permanent ceasefire is laying just ahead of us:

Three-for-one offer today … in COTDs that is.

The first one is in reference to me insisting on starting today’s letter with the bond market instead of the stock market, where for sure, according to your view at least, all the action is happening. Yes, but no. The stock market is seeing action, but it is the tail waged by the bond dog. Consider the chart below - the grey line is the steepness of the yield curve (10y-2y) which is deflating like a beach ball at the end of the summer. The red line is the stock market, happily following the shapc of the YC lower:

The other two charts are two attempts to quantify Trump’s TACO moments. The first is by Vanda:

And the second by BCA:

Nothing specific to watch today, other than all the market price movements across the asset classes for hints what may be coming.

Be safe out there and May the Trend be with You!

André

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"The first ten million years were the worst. And the second ten million... they were the worst too. The third ten million I didn't enjoy at all. After that, I went into a bit of a decline."

— Marvin, in Douglas Adams’s Hitchhikers Guide to the Galaxy

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Markets seem a bit rudderless at the moment, slave to the next Presidential post on social media, which then minutes later is denied by the Iranian regime that according to the next presidential social post does not exist anymore …

Yesterday, Iran rejected the US-proposed 15-point plan, instead laying out its own conditions in a 5-point plan;

(1) halt the killing of Iranian officials;
(2) means to make sure no other war is wage against it;
(3) reparations for the war;
(4) an end to all hostilities;
(5) Iran’s “exercise of sovereignty over the Strait of Hormuz.”

The probability that Washington would accept these terms in exchange for a ceasefire is roughly equal to the likelihood that Tehran would have accepted the original US proposal…zero. Even though, interestingly enough, Iran didn't claim a right to nuclear enrichment or ballistic missiles.

Given the back-and-forth, it is no wonder that volatility in equities,

AND bonds,

remains elevated.

And here we are ticking towards Trump’s self-imposed 5-day five deadline, with volatility elevated as just seen, but still some eerie relative calm.

Maybe the Polymarket bet on a US x Iran ceasefire by April 30th at close to 50-50 is a tell sign for investors’ indecisiveness:

The S&P 500 continues to trade within its ‘box’, we have been observing for a while now, but notably has yesterday also been rejected at its 200-day MA yesterday:

Maybe we are in for a forming of the right shoulder in a classical shoulder-head-shoulder pattern?

A bit too early to speculate on that…

European stocks rebounded ‘better’ the first three sessions of this week, but of course had also been beaten down substantial more than their US cousins

BUT, but, but, of note and to be held in high honour of European equity markets, is the SXXP still trading above its 200-day MA!

Meanwhile, Asian markets are trading mostly softer this morning, lead by the Chinese (HK & Mainland) equity complex. Though all eyes on India, where markets are closed today, as news reports of panic gasoline buying are in crescendo:

The trouble here: Whilst there is no burning tyres in the streets (yet), there is a perception crisis layered on top of a very real supply vulnerability. The self-fulfilling prophecy dynamic — panic creates the very shortage people feared — is textbook commodity behavioural economics. Let’s stay tuned on this one …

In bond markets, US Treasury yields have relaxed a tad from their Monday and Tuesday panic peaks, which is a first good news for equity markets too:

However, we are still only a few pips away from a new cycle closing high …

But an even louder sigh of relieve can heard from the (should I say: current?) UK government, which was on the brink of yet another Truss-moment at the beginning of the week:

The US Dollar remains range stuck and I insist, given the depth of the geopolitical crisis, the lack of additional strength is disappointing:

Oil (Brent below) is obviously a broken chart, not only due to the impact from the news flow described further up, but probably also due to market manipulation, where of rumours have increased noticeably over the past week or so.

Good chart below from the fine folks at BofA. It compares the current concentration of the 10 largest AI-involved stocks to previous famous notorious concentration peaks.

As Trump’s five-day deadline approaches (due tomorrow) anything can really happen over the next hours. Betting markets see split chances for an off-ramp on either side of the conflict, but equity markets are trying to move higher. They may achieve a relieve rally, but longer-term damage has likely been done and will be a headwind over the coming months.

ECONOMIC DATA

• US Initial Jobless Claims — 13:30 CET. Exp. 211K vs 205K prior. 4-wk avg 210.75K.

• US Continuing Claims — 13:30 CET. Prior 1,857K. Proxy for outstanding unemployment; uptick last week.

• EIA Natural Gas Storage — 14:30 CET. Exp. -49Bcf vs +35Bcf prior. Massive swing on Hormuz LNG disruption.

CENTRAL BANKS & SPEAKERS

• ECB — Lagarde keynote — 09:45 CET. “The ECB and Its Watchers” Conference, Frankfurt. Oil-vs-growth framing is the signal.

• No scheduled Fed speakers today. Next FOMC: 5–6 May.

AUCTIONS

• US 4-Week Bill — 15:30 CET. Prior yield 3.615%.

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"When the facts change, I change my mind. What do you do, sir?"

— John Maynard Keynes

I was going to admit that there is some egg on my face with yesterday’s call for (equity) risk-on.

However, I was right for till about European lunch time:

More or less from then on it was oil (red) up and stock (grey) down:

The key news of the last 24 hours is of course Israel’s attack on Iran’s South Pars gas field. This is an escalation, attacking oil production facilities for the first time.

And, it is clearly Israel playing with (literally) fire, which was immediately depictured in the oil futures markets. Whilst the nearest (1 month) futures (blue line below) has not quite yet reached the previous high, the 3-months futures prices (black line) did hit a new cycle-high, expressing the market’s concern that this conflict will go on for longer.

Of course, there was also a Fed meeting yesterday, which was more about “boardroom battle” than interest rate policy. Regarding the latter, the decision was to leave the policy rate unchanged, with strong hints at the fog of war making any immediate visibility more than murky. The decision was nearly unanimous, with only one dissident. Guess who!

Critically, Powell updated his career plans. If Kevin Warsh isn’t confirmed by the end of his term as chair, he said he will carry on as chairman pro term. And as long as the government continues to prosecute him , he will continue on the board of governors, where his term has two years to run…

Talking of egg and faces, I also highlighted yesterday how much yields, illustrated via the 10-year US Treasury yield had come down over the past sessions.

Well, that was that …

The pointed hand is yesterday’s session, which saw a huge reversal not only because a renewed spike in oil prices (which was actually nearly the secondary reason yesterday), but mainly due to a “surprise” high reading in the Producer Price Index:

Is our long-awaited second inflationary wave finally coming? Perhaps.

Above we spoke about how the backwardation in oil futures is slowly abating, as investors start assuming a longer war ahead. One spread that is interesting to watch is the price of oil in Dubai versus Brent. Below the spread, historic, I’d say …

• BoJ rate decision — already out. Held at 0.75% (8-1, Takata dissented wanting 1.0%). Flagged upside inflation risk from Iran/oil. USDJPY back toward 159.

• SNB rate decision — 09:30 CET. Quarterly monetary policy assessment. Key read for CHF and European rates path.

• BoE rate decision — 12:00 GMT. Expected hold at 3.75%. Watch MPC vote split — was 5-4 in Feb. Inflation re-accelerating toward 4% vs. zero-growth economy = stagflation trap.

• US Initial Jobless Claims — 8:30 ET / 13:30 CET. Exp. 215K vs. prior 213K.

• US Philly Fed Manufacturing — 8:30 ET. Exp. 8.3 vs. prior 16.3. Big drop expected — watch prices paid component for stagflation signal.

• US Building Permits — 8:00 ET. Exp. 1.376M vs. prior 1.455M.

• US New Home Sales — 9:00 ET. Exp. 722K vs. prior 745K.

• Fed Beige Book — 14:00 ET / 19:00 CET. First post-FOMC anecdotal read.p

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"In the midst of chaos, there is also opportunity."

— Sun Tzu

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Despite the oil price (Brent) spiking higher yesterday and clocking in a closing high for this cycle,

equity markets actually showed a shy risk-on behaviour as you can see from our daily cockpit above. Given that oil prices meanwhile have reversed lower, that shyness was able to swap over into Asian equity markets (and Western index futures), with strong advances noted across the region but more accentuated in places such as Japan (Topix +2.5%) and Korea (KOSPI +5%).

This latter index is looking VERY constructive already again:

FOMO anyone?

Was Israel’s killing of two Iranian leaders, Larijani and Soleimani enough to make the market think we may be in for a closing of the conflict. Perhaps.

Or is it the famous notorious “The Economist”-contrarian-magazine-cover-indicator that once again is working its ‘magic’?

At least for today, risk-on seems to continue for the next few hours.

Sharply lower bond yields (UST10y) over the past three sessions,

and a mildly lower USD (index), having been rejected at major resistance,

support that risk-on notion.

That’s still not an awful lot of tankers going through that Strait!

A busy day today, with the Fed’s FOMC interest rate decision (no change), but especially the presser of focus. But also noteworthy is that Trump is meeting Japanese PM Takaichi tomorrow. Agenda: Strait of Hormuz. Whilst Takaichi is constrained by constitutional limits and 82% public opposition to the war, any joint-intention agreement could still be a major shift on the global political chessboard. Stay tuned …

• SECO Economic Forecasts — morning CET. Swiss govt quarterly outlook update

• Eurozone CPI (final, Feb) — 10:00 CET / 05:00 ET. Headline exp. 1.9% YoY (flash 1.7%), Core 2.4% (prev. 2.2%). Re-acceleration watch

• German 30Y Bund Auction — morning CET. Previous yield 3.47%

• US PPI (Feb) — 08:30 ET / 13:30 GMT. MoM exp. +0.3% (prev. +0.5%), Core MoM exp. +0.3% (prev. +0.8%). Key CPI pipeline read

• BoC Rate Decision — 09:45 ET / 14:45 GMT. Exp. hold at 2.25%. Press conference follows

• US Factory Orders (Jan) — 10:00 ET / 15:00 GMT. Exp. +0.1% (prev. -0.7%)

• EIA Crude Oil Inventories — 10:30 ET / 15:30 GMT. Exp. -1.5M bbl (prev. +3.8M). WTI ~$92, Brent ~$101

• FOMC Rate Decision + Dot Plot + SEP — 14:00 ET / 19:00 GMT. Exp. hold at 3.75%. Updated economic projections & rate path — the main event

• FOMC Press Conference (Powell) — 14:30 ET / 19:30 GMT

• Brazil Selic Decision — after US close. Exp. cut to 14.50% (prev. 15.00%)

• Earnings - Micron & Five Below

That’s all for today - May the Trend be with You!

André

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"There are no conditions to which a person cannot grow accustomed"

— Leo Tolstoy in Anna Karina

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Short note only today, make sure to check out the upcoming Quotedian - Weekly Edition, most likely published early Monday morning. It will be a longer issue, but mostly due to a large number of charts, as the bridge of the USS Enterprise ASS Quotedian checks for damage control across the macro landscape.

As a matter of fact, today’s note is that short, that I will leave you just with the very powerful chart of the day (COTD).

Have a great weekend and: "May the Trend be with You!

André

When two tribes goes to war … nearly everyone loses.

Nearly everyone. In the case of the Israel/US-Iran war there seems an early award has already been given.

Aaand the winner is …… Russia!

Our COTD shows how the discount (lower clip, light grey) on Russian oil (upper clip, red) to Brent (upper clip, dark grey), in place since the outbreak of the Ukraine-conflict, has not only diminished, but actually briefly converted into a premium!

And then, let me add this “mysterious” headline to the mix:

• US GDP Q4 (2nd est.) — 8:30 ET. Advance was +1.4% ann.

• US Personal Income & Spending (Jan) — 8:30 ET. PCE deflator is the key print

• U. of Michigan Sentiment (Mar prelim) — 10:00 ET. First read post-Iran shock

• UK Industrial Production & Trade Balance (Jan) — 08:00 GMT

• Canada Employment Report (Feb) — 8:30 ET

• Hormuz headlines — Brent back >$100, IEA stockpile release vs tanker disruptions

• FOMC blackout ahead of Mar 18–19 meeting — no Fed speakers

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“Is there any other point to which you would wish to draw my attention?”
“To the curious incident of the dog in the night-time.”
“The dog did nothing in the night-time.”
“That was the curious incident.”

— Arthur Conan Doyle, Silver Blaze

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The effective closure of the Strait of Hormuz has removed approximately 20mbd (million barrels daily) of oil from the global market.

Yesterday, the 32-member countries of the International Energy Agency (IEA) unanimously approved a coordinated emergency oil release of 400 million barrels, the largest in its 52-year history, to “counterweight” that supply shock.

This means that the IEA is providing 20 days' worth of relief oil supplies and implies that the group expects a short war.

The telltale sign is that the price of oil (Brent) did not nudge to the downside, but later in the session rather shot up another ten Dollars or so:

As one analyst put it:

“The flow vs the lack of physical supply in Asia already looked like a plaster on a shotgun wound.”

And this was before Iraqi ports were taken offline, which is, expanding on the metaphor above, another cartridge fired into the same injury.

On another note, US CPI (consumer price inflation) was reported yesterday, and either nobody noticed or nobody cared. In any case, as you know, I de-test this super-lagging, even more super-manipulated economic ‘indicator’, but for completeness purpose, this is what the numbers looked like:

All bang-on inline, but, of course, this numbers do NOT include the recent increase in energy (and food prices - see below), but will do so starting next month. So, doubt not, that this number will be very closely watched again next month and even more so the few months following thereafter.

Here’s another telltale sign (aka spoiler alert) for those upcoming CPI reports:

And then we have to talk private credit again … click here and here for previous conversation …

Yesterday, JPMorgan (of Jamie Dimon's “Cockroaches” fame) began marking down the value of loan portfolios held by some private credit groups, specifically those exposed to software companies that may face existential risks from AI.

Why did JPM do that? Because they can. But it will impact many of their other peers competitors.

Blue Owl, one of those major peers competitors is down now 45% since we highlighted that possibility back in early October. And, remember that technical analysis voodoo chart from a few weeks ago?

“Only” another 30% to go to our initial price target…

Lastly, we need to talk fertilizers … having set-up the investment office of a family office for a major fertilizer producer a few years ago, I know a thing or two about that. No secret here, but energy (Gas) is a major input into fertilizer production. Wonder why then everybody only speaks about the oil stocks going parabolic …

Due to some technical issues today (and yesterday, sigh) I have to cut today’s letter short here, but also, there’s simply too much going on to cover everything in just one daily letter, so my mission is to try to highlight some of the most interesting and hopefully critical/meaningful points in the daily edition of The Quotedian. As I am not quite prepared yet though to publish a “The Quotedain - Hourly Edition”, I will try to pack as much as I can in the next weekly edition, with the working title (spoiler alert): “Damage-Control Reports, All Stations!”.

If your are not signed up to our weekly newsletter, make sure to do so right now:

Let me into the Weekly Edition!

Is the private credit fall-out swapping over into the public/listed bond market? The chart below answers that question with a crystal clear: Perhaps.

The top clip shows the ratio of a investment grade bond ETF (LQD) to a Treasury bond ETF (IEF). It suggest that a breakdown may be occurring.

The bottom clip shows the ratio of (US) financial stocks (XLF) to the broader market (SPY). It demonstrates that financials have been underperforming for the past nine months and may just be breaking down again.

Stay tuned and may the Trend be with you!

André

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

"Our enemies are innovative and resourceful, and so are we. They never stop thinking about new ways to harm our country and our people, and neither do we."

— George W. Bush, August 5, 2004

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If you went to bed Sunday night watching WTI blast through $119 per barrel and Dow futures crater 900 points, you woke up to a completely different tape. All because Donald Trump decided to TACO out — or, to use his own terminology: “The war is very complete, pretty much.”

Pretty much. Kind of. Sort of. Almost.

At his first press conference since launching Operation Epic Fury, held naturally at his Doral golf resort, Trump served up a buffet of contradictions that would make even the most seasoned macro trader’s head spin:

• “We could call it a tremendous success right now” — but also: “we’re going to go further.”

• “Everything they have is gone, including their leadership” — which then became “two levels of leadership are gone.”

• Iranian ships sunk: 46 in his speech, 50 at the presser, 51 minutes later. Inflation, it seems, extends beyond CPI.

• The whole thing? Just a “little excursion.”

George W. Bush at least had the decency to land on an aircraft carrier in a flight suit before his “Mission Accomplished” moment in 2003. Trump did his from behind a podium at a golf club. With no flight suit. But hey — at least the banner would have been more honest: “Mission Accomplished — Kind Of...”

A major doubt just rose in me … let’s poll it:

Anyway, with all this confusion, where Trump wants to declare victory and keep fighting simultaneously, markets want to rally on peace and hedge for escalation simultaneously and Oil wants to be at $90 and $120 simultaneously, it is probably a good idea to look at some chart and try finding a needle or two in the haystack.

Here’s that nearly USD40 roundtrip in less than 24-hours on the price of crude oil (Brent) for example:

Of course, in the bigger scheme of things, Brent is still up 55% since early January and at its highest level in three years:

Equity markets continue to largely ignore that massively higher cost to the overall economy, with US markets close to flat on a year-to-date basis:

The weakest element on the table above, the Nasdaq, is actually UP in March so far, i.e. UP since the war in Iran broke out …

European stocks (SXXP), which are far worse off in expectation of higher energy prices, saw an important rebound yesterday:

German stocks, also saw a reversal at what I would suggest was a key support zone:

Bond yields in the meantime are NOT ignoring the danger of higher energy prices, with US Treasury yields signalling Stagflation, rather than flight to safety:

There might be temporary relief since Trump’s words (note: no action) last night, but I would keep a close eye on this and also Break-evens:

The US Dollar, a tad weaker since last night, continues to be the big winner since the outbreak of war:

But actually shows limited gains, if any at all, since the beginning of the year:

I live my investment life by several mantras, two of the most important (which are actually book titles) being:

1. Triumph of the Optimist (when I get too bearish)

2. Being right or making money (when I get too emotional)

There are many more, but a third one which is simply too often ignored is:

3. Price Leads Narrative

Don’t believe me? Just explain me then why oil stocks (below measured via several ETF proxies), have been going up weeks before the oil price did and months before the war broke out…

• G7 Energy Ministers virtual meeting this morning — coordinated strategic reserve release likely on the table

• Oil — does Brent hold sub-$95 or do we retest $100? Every Trump tweet/Truth Social post is a volatility event

• Strait of Hormuz — Iran’s IRGC called Trump’s comments “nonsense” and warned tankers to “be very careful.” Classic.

• European equities — will Europe play catch-up with the US reversal or price in continued Hormuz risk? Energy vs. everything else.

• Bonds — 10Y at ~4.14%. Stagflation fear vs. flight to safety. Watch breakevens.

May the Trend be with you!

André

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“In war, truth is the first casualty.”

— Aeschylus

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Just a quick note before heading of into a (hopefully very) interesting technology investor’s day…

Oil continues to grind higher. Here’s the price chart of Brent:

Bond yields in the US,

as those in Germany (below), the UK and Japan,

also continue to grind higher.

It remains therefore a conundrum (at least to me), how stocks have been able to hold up (see chart below and also COTD). As an example, the S&P 500 continues to range within its “box”:

Of course, other markets have seen a higher impact, as for example Germany’s intensive economy expressed via the DAX:

Maybe, as usual, and as I showed via a graph in Tuesday Daily Edition (click here), we truly also have to fade this geopolitical event and just blindly buy the (equity) market?

Or, is the equity market in denial, as it was back in February of 2020, when it hit a new all-time high as the COVID crisis was already well visible. It needed the headline “Tom Hanks has COVID” then to rattle up investors.

Having said that, enjoy your weekend and …

… May the Trend be with You!!

André

This year, barely just over two months old, has seen all kind of excitements:

• The Madura capture in Venezuela

• The Fed Chair succession Drama

• The launch of Claude Opus 4.6 (with all kind of attached apps) having a deep (negative) impact on software stocks (see: FrankenstAIn)

• US–Israel strikes on Iran (Operation Epic Fury)

And the list goes on …

So, surely stocks must have been all over the place, right?

Wrong!

As a matter of fact, the S&P 500 has seen its tightest range to start the year in history:

Amazing!

• Eurozone Q4 GDP (third estimate) — 11:00 CET

• ECB’s de Guindos at IIF European Summit, Brussels — 09:50 CET

• ECB’s Cipollone at EIB Group Forum, Luxembourg — 11:45 CET

• US Non-Farm Payrolls (Feb) — 14:30 CET (cons. +50K, prev. +130K)

• US Unemployment Rate (Feb) — 14:30 CET (cons. 4.3%)

• US Average Hourly Earnings (Feb) — 14:30 CET

• ECB’s de Guindos hosts Martin Wolf lecture “The Crisis of the Liberal World Order” — 14:30 CET

• ECB’s Lagarde delivers Annual Global Risk Lecture, Bologna — 18:00 CET

• US Consumer Credit (Jan) — 21:00 CET

• Earnings pre-market: DICK’S Sporting Goods (DKS), Hormel Foods (HRL), Embraer (ERJ)

• FOMC meeting next week (March 17–18) — blackout period starts Saturday

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

Good Morning,

Today, you get to vote for your own favourite Quote, which is in reference to today’s Chart-of-the-Day (COTD, see below). The choices are:

There is always a bull market somewhere

and

Never let a good crisis go to waste

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Realisation started settling in on the second trading day since the Iran war started, that this may not be over in 72 hours.

Accordingly, stock markets around the globe continued to sell-off:

But not all markets are being treated equally…. Europe (SXXP) is being hit hard on increasing energy costs,

whilst the US (S&P 500), which is largely energy self-sufficient, has seen a much smaller fall-out:

This energy-cost difference is not least seen in that widening Brent-WTI spread (lower clip) I already touched upon in the weekly Quotedian issued last Monday (click here):

Even more visible is that energy-cost at the natural gas price level, where Dutch NG has exploded higher whilst the Henry Hub version (US) is keeping its calm:

Crude oil prices exploded higher yesterday, until assurance from President Trump that they will escort ships through the Strait of Hormuz gave short-term relief to price pressures. HOWEVER, this morning the market seems to remember that a handful of terrorists (or liberation fighters, pick your definition) in flip-flops where able to keep the Strait closed for a prolonged period of time. Imagine what the IRGC (Islamic Revolutionary Guard Corps) could do with a couple of rockets and drones. Hence, the oil price is shooting higher this morning:

As were the demise and prospect of higher energy prices not already enough in Europe, we also got inflation readings which were above expectations … and this before the impact of fore-mentioned energy prices:

Whilst Headline inflation at 1.9% is still below the ECB’s two percent target, the Core reading ticked in at 2.4%.

The impact on European yields, below proxied via the German 10-year Bund was immediate:

I fear that the bond market riots may only be in its early innings, especially if I am right about the impact of possible likely nearly-guaranteed supply chain disruptions…

May the Trend be with You!

Today:

• 🇨🇭 Switzerland CPI (Feb) — next update due today; Jan was +0.1% YoY, barely above zero. Key for SNB rate path

• 🇪🇺 Eurozone Unemployment (Jan) + Italy GDP (Q4, final)

• 🇺🇸 ADP Employment Change (Feb) — 8:15am ET, cons. 49K vs prior 22K; first NFP preview

• 🇺🇸 ISM Services PMI (Feb) — 10:00am ET, cons. 53.5 vs 53.8; watch Employment sub-index for payrolls clues

• 🇺🇸 Fed Beige Book — 2:00pm ET; qualitative read on hiring, tariffs, business sentiment ahead of March 18-19 FOMC

• 🇺🇸 Broadcom (AVGO) earnings AMC — EPS est. $1.88; AI infrastructure bellwether, last quarter beat by 13%

• 🇺🇸 Also reporting: Abercrombie & Fitch (ANF), Bath & Body Works (BBWI), Veeva Systems (VEEV), Wix (WIX) (BMO)

Separately, in China the 15th 5-year plan is in ‘discussion’ (simplified):

🇨🇳 China “Two Sessions” (Mar 4-11):

• China’s annual parliamentary meetings open today, but this year’s edition is special: the 15th Five-Year Plan (2026-2030) will be formally unveiled — Beijing’s economic roadmap for the next half-decade

• Premier Li Qiang delivers the Government Work Report tomorrow (Mar 5) — watch for the GDP growth target (likely lowered to ~4.5-5%) and fiscal spending plans

• Key themes: tech self-sufficiency (AI, quantum, 6G), boosting domestic consumption, and navigating US-China trade friction

• First FYP launch since 2021 — historically a strong signal for which sectors get policy support (and capital) for years to come

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“We are all conditioned.”

— Ivan Pavlov

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As I wrote in yesterday’s LinkedIn post (click here), the fog of war surrounding the Middle East is still thick and heavy, and this is not the time to make some heroic market calls.

However, I would start daring to make some shy observations, which are mostly of unsettling nature.

We all know that the five most expensive words in finance are:

“This time it’s different”

However, let me use for today:

“But what if …”

For starters, the last nearly twenty years of (equity) market sell-offs, especially with relation to geopolitical events, have taught us to “fad them” aka “BTFD”. One of my all-time favourite analysts (no, no cheek in tongue, really adore the guy) cheerleaded that notion yesterday in X:

Or in other words, this is the quantitative confirmation of what Nathan Mayor Rothschild said some x years ago:

“Buy on the sound of cannons, sell on the sound of trumpets.”

And here’s where my “What if…” comes in …

WHAT IF … the failure of the US 10-year treasury bonds not only meaningfully fail to gain territory, as they usually do during major global geopolitical events, but even see a more-than-notable sell-off is a tell sign?

Here’s the 10-year US Treasury yield (opposite of bond prices):

That 12/13 basis points from bottom to top is not negligible. Is it based on an increase on an expected rise in future inflation? USD inflation swap rates would answer that rhetorical question with a firm YES:

Is that inflation expectation increase due to a higher crude (oil shock?) only?

Largely, but not excusively. General supply chain worries are probably playing a role too.

For example, WHAT IF a major US online retailer would suddenly see its operations hit in the Middle East?

Oh? Oh! We already had that!!

Is this maybe why equity markets have turned sour again overnight, after they had reclaimed early losses on Friday? Here’s the S&P mini-Future since Friday:

Asian markets are feeling some heat this morning:

Also moving … Silver, where maybe the industrial aspect is suddenly "shining “ (ha! what a silly pun!) through more than its precious metal affiliation:

That is a 14% drop highlighte in that chart over just two sessions …

Gold, for the right reasons, is hanging on in there:

I insist, not the time to stick out your neck investment wise, and if the itch becomes too strong, focus on (small) position sizing.

Three quick mentions:

1. The USD is finally reacting to the upside:
   

   

   
   

2. European defense stocks largely failed to react to war breaking out:

   

   which could mean most is already priced in, or,
   

3. investors expect a massive increase in European energy costs (and defense is an-energy heavy industry). Here’s the price jump in Dutch Natural Gas prices:
   

   

   
   

Let’s pretend for a moment there is no major geopolitical conflict going on right now.

Seems everybody has already forgotten about the private credit disaster story that is unfolding and seems to be showing first sign of contagion into private equity and financial (bank) stocks.

The chart below basically asks, if (or when) the last domino stone (aka broader stock market) will fall:

• First, private debt (blue - BIZD) started tumbling

• Shortly after, private equity (red - PSP) followed

• Recently, bond volatility (light blue - MOVE) and Credit Spreads (light grey - CDX IG) - both inverted - have turned ‘lower’ too

• Will stocks (thick grey - SPX) soon follow?

• Little on the economic agenda, except some inflation data out of Europe (which now does not matter until in a few months) and Japanese unemployment numbers

• Fed’s Williams & Kashkari Speak

• Trump meets Merz at White House

• UK Chancellor Rachel Reeves delivers her Spring Statement

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“Wall Street’s graveyards are filled iwth men who were right too soon”

— William Peter Hamilton

20260226 Npb Db

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Please note, the PDF version of our Daily Dashboard now has a second page, showing the recent fortunes of NPB’s Equity Focus List, a collection of forty recommended stocks across four geographical regions.

If you’d like to continue to see this in the future, please leave a comment in the comment section:

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Well, NVDA came, saw and reported yet another blow-out quarter in terms of earnings, beating expectations for a 14th consecutive time since the initiation of the current AI-craze:

The market is largely shrugging it off, with the stock only marginally higher, but given its still lofty valuation, that’s more than ok. To me, the chart of the company’s stock price definitely looks like continuation as opposed to reversal:

It was ‘cute’ how Jensen Huang tried to reduce the damage done by AI on the software sector:

Let’s see how successful that endorsement will be, for now the iShares Software ETF (IGV) is trading lower pre-market.

The broader market (S&P 500) itself saw a decent rally, but remains boxed:

However, the upside participation was broad, with 71 companies in Europe (SXXP) hitting new 52-week highs versus 15 trading at new 52-week lows. And the ratio was 61:12 for US stocks (SPX). Also check our daily dashboard for breadth indications (lower left corner).

Hence, no surprise then to see that the equal-weight version of the S&P 500 (proxied via RSP ETF) closed only a quarter of a percentage point off a new all-time high:

In conclusion, the overall stock market constellation looks ripe for a move higher, maybe to new all-time highs, over the coming sessions …

… HOWEVER …

we unfortunately have this looming and overshadowing overall sentiment:

Pulling up that impressive military presence in the Middle East comes at elevated costs to the US taxholder, hence Trump is unlikely to walk away with some mediocre concession on the behalf of the Irani regime. And the Irani regime, counting on “not much more” than air strikes, may even speculate that this could rally public support behind them, something that is much needed after the recent riots.

In other words, some kinetic action over the coming weekend is an elevated possibility.

What does it mean for investors? Could it throw a stick in the wheel of equity bulls. Probably.

Should the oil price move higher?

Well, it does continue to move within a defined uptrend (see chart above), but it is difficult to assess how much of a kinetic escalation is already in the price. Nevertheless, entering a long here with a tight stop somewhere below 65 would be a low-risk, high potential return proposition. Also, see our chart-of-the-day today.

Long gold?

Perhaps, though pre-empting a breakout out of the triangle could be costly and a stop below 5,000 would surely be a good ‘hedge’ for an alternate outcome.

But, maybe in gold it is the better value proposition to invest via the miners, which will continue to do very well, even if the Gold spot price ‘only’ holds current levels.

I like second tier players such as Alamos Gold (AGI),

and B2Gold (BTG):

We briefly discussd the oil price above and the its current positioning in an uptrend channel. Zooming out on the same (WTI), we note that the USD66 level, previously crucial support, has now turned into what could be an all-defining resistance level:

A break above, could bring a whole new set of previously uninterested investors on to the long side …

• ECB’s Lagarde speaks at the EU parliament

• M3 Money Supply for the Eurozone is due

• US Initial Jobless Claims

• Fed’s Miran on Fox Business and Fed’s Bowman Testifies Before Senate Banking on Regulation

• And, of course, US/Iran negotiations in Geneva

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG

“The secret of change is to focus all of your energy, not on fighting the old, but on building the new.”

— Socrates

20260225 Npb Db

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Yesterday’s equity session found a positive twist, especially in the early stages of the US trading session, after which initial enthusiasm faded:

The story remains, as we already highlighted in yesterday’s Quotedian (click here), that the index remains range stuck in a tight 200-points (± 3%) range:

The 50-day trading range has fallen to its narrowest since 2017 according to this chart:

Yet, volatility (VIX) remains relatively elevated:

This elevated volatility can probably be explained via dispersion (i.e. performance difference between the different index members), which remains high:

Breadth, as measured by the cumulative advance-decline ratio on this occasion (lower clip, red line) continues to support a break-out on the upper end of this trading range eventually:

Nevertheless, has the NPB Investment Committee for now decided to leave recently raised cash on the sidelines until a clear break is confirmed. See our note here:

Cio Allocationflash 02 2026 Equity Back To Neutral New

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Trump’s nearly two-hours “State of the Union” show speech brought nothing market relevant; maybe only reading between the lines the absence of speaking meaningfully about Iran could be a hint …

In Asia, the Nikkei continues to stampede higher:

Are you invested enough? Are you invested?!

Little movement in rates and currency markets, so we’ll skip this today.

Remains to be mentioned that Silver broker, against my expectations, early out of its consolidation triangle and if it is able to close above the dotted line (ca. USD90.50) the technical picture will be very constructive again:

Today’s chart-of-the-day is not really a chart, but nevertheless more the “fun” then ever. It’s Anthropic’s (the makers of Claude.ai) list of targets, split into missions completed (left, red) and futures objectives (right,blue).

Anthropic is the true Hit Man!

• And speaking of AI, of course today is the big day of every quarter where NVIDIA is to report their earnings (after-market)

• In Germany, we get GfK Consumer Confidence and GDP revision (yes, yet another one)

• In the US, just MBA Mortgage Applications as an economic number

• Everything in this document is for educational purposes only (FEPO)

• Nothing in this document should be considered investment advice

• Investing real money can be costly; don’t do stupid shit

• Leave politics at the door—markets don’t care.

• Past performance is hopefully no indication of future performance

• The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG