11.9.22: Crypto Contagion Affects Tech Sentiment. U.S. CPI Data Released Tomorrow.
Key U.S. and China brief market notes by Larry Cheung's Analyst Staff Team for our Public Email List
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In our emails, we will provide the following coverage points:
Brief Snapshot of U.S. & China markets and valuation
Our Analyst Team’s Chart in Focus
U.S. & China Upcoming Economic Calendar Snapshot
Notable Chart from Media Outlets
Fear & Greed Index Recap
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U.S and China Markets Brief Snapshot 🇺🇸 🇨🇳
(Powered by our Channel Financial Data Provider YCharts)
S&P 500 Index: 3748.57
KWEB (Chinese Internet) ETF: $22.48
Analyst Team Note:
A word on the crypto implosion we’ve seen over the past couple days…
“What makes this new phase of crypto deleveraging induced by the apparent collapse of Alameda Research and FTX more problematic is that the number of entities with stronger balance sheets able to rescue those with low capital and high leverage is shrinking. A cascade of margin calls is likely underway.” - J.P. Morgan
Macro Chart In Focus
Analyst Team Note:
We’re seeing the unwinding of the absurd sectors of the financial markets from SPACs to crypto (FTX/BNB fiasco). This is likely just the beginning as we still have a lot more liquidity to flush out of the system.
Upcoming Economic Calendar
(Powered by our Channel Financial Data Provider YCharts)
U.S Economic Calendar (Upcoming Data Points)
China Economic Calendar (Upcoming Data Points)
Analyst Team Note:
“The midterm elections is also likely to have little, if any impact on the Fed. Ironically, in the past two years the Fed has inadvertently done the opposite of what a politically compromised central bank will do. Standard Political Business cycle theory argues that a central bank will want to ease going into elections so that incumbents enjoy low unemployment and low interest rates. Then as inflation picks up with the usual lags, the central bank tightens to bring inflation back down. This sets them up for the next election season. Last year, the Fed kept postponing rate hikes even though no election was looming. In our view, there was nothing political about this.” - Bank of America
Chart That Caught Our Eye
Analyst Team Note:
Americans have steadily allocated higher ‘share of stomach’ to FAFH (food away from home) over time, with the pace of change accelerating sharply over the past decade (share of stomach increased from 40% to 46%). In addition, in times where relative cost gaps has declined (i.e., cost of FAFH is more favorable relative value) restaurant demand tends to pick up.
Sentiment Check
We want to take a moment to thank Interactive Brokers for being one of our Channel’s trusted Partners and to inform my audience of the special features they have given that our online friends here closely follow Chinese Internet stocks (BABA/Tencent).
Much of Larry’s audience is concerned about the US ADR issue of Chinese Stocks being delisted.
Interactive brokers allows investors to buy HK-listed shares of Alibaba, JD, Tencent, and other brand name Chinese Internet companies on the HK market. This will effectively reduce any confusion or work you will have to do in case there is the event of delisting US ADRs
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