Bill Ackman closed his short positions on the 30-year treasury yield, stating reasons such as rising geopolitical tensions and too much economic uncertainty. The 30 year yield is now at around 5% range.  To put things into context, when he shorted the 30 year yield, he said that the 30 year yield could hit 5.5% and the reasoning was that firstly he thinks inflation will not slow down as fast as the market believe. Secondly, government is issuing too much treasury securities to raise money for government spending (supply of bond increases, bond price fall, bond yield rise). Thirdly, the ending of Japan's Yield Curve Control, reducing the demand for US bonds. Now, after he closed the short position, the bond market actually rebounded, suggesting that bond prices might have hit a low. Th

Regional Bank stocks have rallied quite substantially on 6 June due to firstly, many executives of these regional bank stocks are loading onto them. According to reuters, a total of 778 executives and officers bought into their respective bank stocks in Q2 which is more than in Q1 when SVB collapse which only had 524, both times were attempts to boost investors and consumer's confidence. I believe that this buy in is not just a shot in the dark by these executives but rather they see an opportinity to increase their shareholding and decision making power alongside boosting consumer confidence and their own wealth. A secondreason for this rise is because the market is currently pricing in a 80% chance of the FED not hiking rate this round or decreasing the interest rate by 25 basis poi

The majority of China stocks ralied in today's trading hour which was led by the news of Alibaba splitting into 6 different companies : Cloud Intelligence Group, TaoBao, Local Services Group, Cainiao, Global Digital Commerce Group and Digital Media & Entertainment. This split in the company caused Alibaba shares to jump by 15% in its US listed shares due to people thinking that by splitting the company, China's regulators will reduce their focus on them. This is because the regulators don't want a company to be too large thereby having too much power in the market, so by splitting the company into 6 parts, investors are pricing in the potential for regulators seeing Alibaba as 6 big companies instead of 1 mega large company, thereby reducing regulations on them. Despite this, Alibaba a

This post will cover why SVB collapse, its implicaions on stocks and crypto and also new CME data after SVB disaster. First of all, Silicon Valley Bank 'collasped' due to liquidity issue. SVB operates mainly by taking in silicon valley client's fund which was probably gotten from private equity investors and the money deposited in SVB is likely to be needed in the short term, hence SVB has to keep its liquidity. To do so, SVB invest a majority of these deposited money in US treasury bills as they are more liquid than loans, leases and bank premises. But as the FED raises interest rates, the amount of interest SVB gets from treasury bills has became lower than the amount they have to pay interest to clients. Smart clients noticed this and started withdrawing money, promting more a

Major indexes like the SP500 and dow jones tanked by around 0.6% immediatly after Powell said 'rates are going to be higher than expected.' This is because the immeidate fear that people got was firstly, the recent 0.25% rate hike that we got from the FED might be short lived and the next rate hike might go back to 0.5% which will be bad for the market especially because some analyst were already saying the rate hike cycle could be over soon after that 0.25% hike. Secondly, people fear that the terminal rate will be hiked higher than previously priced in which was at around 5.1% but has now increased to 5.25%-5.5% range according to CME data. And lastly also because of investor behaviour whereby if i know this news is going to crash the market, I will sell and short also, thereby increasin

major indexes are up more than 2% in today's trading hour, the reason for that is because UN said the FED is destroying global growth and is encouraging the FED to take it slow and the RBA (Australia central bank) raising interest rates by 25bp instead of 50bp. This caused the market to rally in anticipation that the FED will pivot soon ( the pivot narrative ). But at the same time, do remember that the FED needs to keep its credibility, and the only way the FED could do that is by following its course that they have planned out, which is 2% inflation. But ultimately, these are all just speculation because the market is just a place for speculations. The next key date is probably 5/10 when NewZealand is set to have their cash rate statement, which will be an indicator of how much the UN st

The market is up during pre-market trading with sp500 up by 0.8%, Nasdaq100 up by 1% & Dow jones up by 0.6%.This rally in pre market due to mainly 3 reasons : 1 ) JOLTS is set to come out at 10am NYSE time, giving investors hope that good news will come out 2 ) Oil price decreased slightly today, causing investors to hope that inflation will ease 3 ) After 2 consecutive days of red, bullish investors are re-pricing the market, hence a correction to the upside. ( same concept as why when market is up consecutively for several day will lead to an eventual red dayBut, don't get too exited about this rally, 1) Firstly, historically ( this year ), everytime on the day when the JOLTS data comes out, it had lead to a green day (can fact check

The US market is up quite substantially already from its bottom in June‌ $SPDR S&P 500 ETF Trust(SPY)$‌. With this in mind, my analysis is based on the following points : - Labour force - FED ( raise rates + jackson hole symposium ) - Current market sentiment  - Future earnings recessionLabour Force :Although the most recent unemployment data was a beat by a huge margin, but in truth, labour force particioation rate had fell since march 2022 and is below 2019 level, which is a huge contributing factor on why unemployment rates fell. Some might argue that the fall in labour force participation rate is due to people wanting to work for themselves, but in my opinoin, it is more likely that people ( mostly lower inco

Key Points: ‌- US economy is strong now - 8.5% CPI is still too high - The market is stubbornly euphoric now - Big money shunning from stocksStrong US economyThe US economy is definitely strong now ( the jobs number, PMI number etc )CPIBut the most recent CPI number is 8.5% which although is lower than analyst expectations, but is still very much higher than the FED's target of below 2% inflation. This means that the FED will have to raise rates alot more in the coming FOMC meetings. Usually, when the FED hike interest rates, the market tends to fall because the market is a forward looking indicator and an increase in interest rates will disincentive buisnesses to hire and expand ( which is what we are seeing now ). Stubbornly EuphoricBut in today's scenario,

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