Banks/Broads in the face of elevated L/T yields

Not very happy signaling from the Pigs Neither nominal KBE… …nor the KBE/SPY ratio are looking very good in the face of rising yields. Indeed, KBE above is in a nasty looking pattern as it stands now. The banks are normally thought to benefit from rising yields, but I think a ‘carry’ on the short end is busted. But then again, you could view the … Continue reading Banks/Broads in the face of elevated L/T yields

Of course the Pigs are flying

Banks are posting a strong quarter The inflation (money printing by the Fed) has brought reflation (economic benefits of said inflation) and none are more targeted for benefit than the Pigs… err, that is, the banks. I have not read the article, but you can if you’d like by clicking the graphic. The headline gives reasons like something called a reserve release, advisory and asset … Continue reading Of course the Pigs are flying

vs. SPY: A view of reflationary progress (or lack thereof)

A picture of various reflation-sensitive markets vs. SPY/SPX The picture says that equity-centric reflation markets are struggling to regain uptrends relative to the broad SPY/SPX, and indeed are maintaining the downtrends begun at varying points during the summer cool down. Raw commodities, however, are making a move. Strength in commodities would be an early component of an economically negative Stagflationary backdrop. Later, they’d probably cave … Continue reading vs. SPY: A view of reflationary progress (or lack thereof)

Reflation ‘on’? The Pigs seem to think so

Let’s get through CPI tomorrow to see if there are any surprises to the view on the effects of the Fed’s printed inflation and the government’s pushed inflation. I don’t see how there could be a downside surprise but in this market, you never know. Do the Gold/Silver ratio and USD know something we don’t? See something out ahead that we don’t? That is the … Continue reading Reflation ‘on’? The Pigs seem to think so

tyx

As COVID-19 Backs Off and Yields Back Up…

Today came the happy – and inevitable – news. Some day on the horizon this effing virus is going to stop hanging over our shoulders. Some sectors especially appreciated the combo of COVID fears down and yields up. Among others, the Airlines, +19%… The pigs, +13%… And Energy, +14%… I happened to buy both CVX and XOM last Thursday on a hunch (certainly not on … Continue reading As COVID-19 Backs Off and Yields Back Up…

Pigs Take Flight

A couple days ago we asked the question in light of rising long-term yields, a steepening yield curve and the ongoing reflation operations by policymakers. Today the Regional Banks appear to be in receipt of the memo. So are the larger Pigs, as they take out the 200 day moving averages. And the KBE/SPY ratio is ticking a new bounce high. So far, so good … Continue reading Pigs Take Flight

nftrh plus

NFTRH+; A Piggie w/ a Potentially Very Bullish Chart

Any discussion of the banks and greater Financials sector has to include a discussion about interest rates. I believe that long-term interest rates will eventually work higher and if that results in a steepening yield curve (with the Fed pinning down the short end) so much the better for the banks as long as the economy holds up. In other words, if a cyclical inflation … Continue reading NFTRH+; A Piggie w/ a Potentially Very Bullish Chart

A Logical Progression for the Banks

Would it not follow that companies who borrow short and lend long (i.e. as banks are usually thought to do) would benefit from the increasing spread between long and short-term yields if our yield curve steepner play is a good one? Anyway, I’ve been accumulating this fund. The chart is not yet anything to write home about and that may be attributable to poor operational … Continue reading A Logical Progression for the Banks

The Curious Case of the Banks Continues

Curiously, in a rising long-term interest rate environment… The Banks are still dropping. The Banks are still dropping harder than the S&P 500 (SPY). Despite the yield curve, which is still intact to its bounce (steepening) potential. A steepening yield curve would theoretically improve banking business from a borrow short, lend long perspective. Unless of course a steepening yield curve were foretelling an economic slowdown, … Continue reading The Curious Case of the Banks Continues

Look Who is Still Not Buying the Bond Bear

Why, it’s the Pigs. Despite all the interest rate hype the Banks, which should benefit from a breakout in long-term yields, are still bearish. In a now public update yesterday we looked at the reasons 30 year yields may not continue to rise, despite the opinion of chart jockeys far and wide (including me, as I see the pretty chart patterns on yields). NFTRH; A … Continue reading Look Who is Still Not Buying the Bond Bear

10 & 30 Year Yields Up, Stock Market Up… Banks Down!

Okay, this has got my full attention now. While long-term interest rates do this… …and this… The nominal Bank index is still doing this… While the S&P 500 and most US and global stock markets are green today. Hence, BKX/SPX is doing this… So what, I ask you, are the pigs doing under performing for such an extended period while long-term Treasury yields have been … Continue reading 10 & 30 Year Yields Up, Stock Market Up… Banks Down!

Pigs Diverging the 10yr Yield

As noted in this week’s NFTRH US & Global Market Internals segment, an important leader is failing to lead. That is all the more notable because said important leader is the Bank sector, which is normally well correlated to long-term interest rates. What is up with this disconnect? What is KBE/SPY telling us about the yield and/or the state of economic health if the yield … Continue reading Pigs Diverging the 10yr Yield