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1. M&A activity shows modest growth in March
“The number of U.S. M&A deals decreased by 1.4% from February to March, while total spending on U.S. M&A deals increased by 0.2% during this time”.
2. Continuing jobless claims 1.87 million
“Continuing jobless claims came in at 1.865m for the week of Apr 7, above the est of 1.825m. These are now in-line with pre-pandemic levels and where they were before the Fed retired transitory in Nov 2021”.
3. Jobless claims rebound to 245k
“Jobless claims rebounded to 245K while continuing claims hit the highest level since Nov 2021”.
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JPM last week: “A rising trajectory in [jobless claims] took hold last month. A sustained move well above 250k in the coming months would send a signal that the economy is sliding into recession”.

4. US households in great shape
“US households are in excellent shape, the ratio of liabilities to net wealth has declined 50% since the 2008 financial crisis, and household leverage is currently at levels last seen in the early 1980s, see chart below. If the unemployment rate rises, consumer spending will slow down, but the starting point for US households is very strong”.
5. American Express customers airline spend up 60%
“American Express showing that its customers are still going strong. Total network volumes ($399 billion) were up 16% in Q1, as travel & entertainment grew 39% YoY. Within T&E; Airlines +60%, Lodging +31%, Restaurants +28%, Other +39%”.

6. BAC customers show strong consumer spend
“Bank of America says consumer spending was still strong, up 9% YoY in Q1 23”.

7. Movie theatres showing no signs of a slowdown
“No recession in the movie theaters. Consumers are visiting the movies more frequently than they were before the pandemic. This may be one of the few remaining reopening factors lingering in the economy. Movies were down for a long time”.
8. Hotel demand slows
“Hotel demand has slowed down in recent weeks, occupancy rates, RevPAR, and daily rates have started moving lower”.
9. The broader picture of flows
“Investors continue to put their money into money market funds”.
10. Risk-off flows continue
“Risky vs. safe assets fund flows remain very negative, which is contrarian bullish for equities”.
11. Fallen angels growing
“In 1Q23, $11.4 billion of bonds were downgraded to high yield status, which is about 60% of 2022’s full-year total per Barclays … full-year volume on pace to be highest since 2020; notably, bank also expects pickup in number of “rising stars”.
12. US housing update
“The median sale price for a home in the US fell 3.3% over the past year to $400,528, the largest YoY decline since 2012. New home listings fell 23.3% year/year in March to lowest level on record (aside from start of pandemic on seasonally-adjusted basis). Rent in the CPI was +8.8% year-over-year, but that is a severely lagged number. It's simply capturing the old rent hikes from 2021 and 2022 in the March 2023 data. The true reality is something very different, rents are DOWN over the last year”.

13. Zooming out on home prices
“Here's the chart from the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index (HPI®) released March 28th, 2023”.
14. Weekly dose of copium
“The S&P 500 has gone 6 months without a new 52 week low after a bear market. Only twice did it do this and go on to make new lows, in 1946 and 2001. The other 11 saw gains, some saw big gains. In other words, new lows from here would be quite rare”.

15. Anti copium
“The S&P 500 has NEVER bottomed before a recession (data going back almost 100 years)”.
16. Greenshoots in China
“China’s economic growth bounces back as consumers spend again. GDP +4.5% y/y in Q1 2023. Retail sales +10.6% y/y in March. Industrial production +3.9% y/y. Unemployment rate 5.3% (-0.3pt)”.
17. Tourism helps Japan’s economy
“ourism is providing a boost to the Japanese economy, especially the services sector. IGN believes policy normalization could happen "in the coming months" if the economy continues to improve”.
18. UK economy struggling
“The British economy has just completely stagnated over the last year. It's still marginally smaller than it was in September 2019. Just brutal”.
19. UK highest inflation in Western Europe
“UK headline inflation unexpectedly remained above 10% for the 7th(!) consecutive month. UK core CPI did not come down at all & retail price inflation also topped the consensus forecast. The Bank of England continues hinting at pausing the tightening cycle”.
20. Euro inflation cools
“Euro area annual inflation at 6.9% in March 2023, down from 8.5% in February”.

21. US Mortgages remain in okay shape
“97% of outstanding mortgages have interest rates below the current market rate while 2% of mortgaged properties have negative equity, down from 25% in 2011”.
22. Manufacturing index at precarious level
“The Philly Fed Manufacturing Index has moved down to -31, its lowest level since May 2020. In the past, every time this indicator was at or below current levels the US economy was either in or approaching a recession”.
23. Existing home sales fall 2.4%
“Existing homes sales -2.4% to 4.4mn units in March (-22% YoY) with no region rising. Housing affordability stable at depressed level. Depressing figure, and leading indicators point to lingering housing weakness amid depressed affordability”.
24. Bears reload shorts
“S&P 500 net short positions reach highest level in more than a decade”.
25. Hedge fund launches lowest since late 90s
“Last year saw just 166 new launches, the fewest since 1998. Yet, reflecting a cyclicality that is often evident in markets, 2022 turned out to be one of the best years for hedge funds in a long time. Equity hedge funds were down just 10% in a year when the S&P 500 index was down 20%”.
26. Wages outpace inflation
“US workers are starting to see pay gains run faster than inflation, amplifying their purchasing power and giving the Federal Reserve reason to raise interest rates again next month. Median weekly earnings of full-time wage and salary workers were 6.1% higher in the first quarter of 2023 compared to the same period a year earlier, the Bureau of Labor Statistics said in a report Tuesday. Inflation during that time ran at 5.8%, the BLS said”.
27. Global container rates flattening
“Global container rates slowed their decline to a crawl this past week. The composite rate decreased by just $1 per forty-foot container. There are already signs that spot rates have reached their bottom, but there is no certain direction ahead”.
28. Debt ceiling
"A large majority of FMS investors (80%) believe that the US debt ceiling will be raised by Sep'23”.
29. C.R.E.A.M
“Cash levels remained at 5.5% in April and have remained above 5.0% for 17 consecutive months, eclipsed only by the 32-month dot-com bear market. Investor allocation to equities relative to bonds drops to its lowest level since the global financial crisis, via Michael Hartnett”.
30. Fund managers favour US > EU
“Still much hatred for Eurozone equities.”.

That’s all she wrote!
Thanks for reading,
Conor