Sebastian Dypbukt Källman

Unsuccessfully fighting a chart addiction.

[Sebastian Dypbukt Källman @sdypbuktkallman]

Nonfarm payrolls strength very much driven by normalization of negative weather impacts during Jan/Feb. Absence due to bad weather, which remained elevated in Feb, signals broader weather impacts on employment. Especially visible in sectors like leisure/hospitality.

Temporary boost, and old news.

[Sebastian Dypbukt Källman @sdypbuktkallman]

US macro surprises see modest support soon. Looks like only temporary relief for markets for now, but supports a reversal in US vs RoW trades

[Sebastian Dypbukt Källman @sdypbuktkallman]

US fiscal dominance continues, with fiscal again compensating for tight monetary policy. Fiscal was key to both the Q2/Q3 growth scare and the macro improvement that followed. Not yet rolling over.

[Sebastian Dypbukt Källman @sdypbuktkallman]

Weaker October NFP indicated by US employment proxies after predicting last month's positive surprise. Hurricane impacts make markets more likely to look past it but if proxies don't improve from here we should start topping process in US rates in November

[Sebastian Dypbukt Källman @sdypbuktkallman]

US macro surprises trending higher in line with model lead. Advantage equities over bonds for a few more weeks

[Sebastian Dypbukt Källman @sdypbuktkallman]

@Bardamu_31 Yeah wasn't meant to be guidance on price level, more on direction. Stronger demand from non-Chinese sources like you say.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@Bardamu_31 Yeah just above 50% should be infra/construction and the rest industrial but a big chunk of that is domestic demand as well.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@CavaggioniMario Slightly perhaps, but I don't think infra spending will roll out quick enough to time the Chinese slowdown, and it's spread out over several years.

[Sebastian Dypbukt Källman @sdypbuktkallman]

China will gradually start to weigh on the global industrial cycle. Shouldn't hamper the global (services) recovery in the end, but can affect macro surprises more given the tilt towards manufacturing in popular macro figures (incl. ISM, which is quite internationally exposed).

[Sebastian Dypbukt Källman @sdypbuktkallman]

🇨🇳 Another weak credit figure. Credit impulse bottoming out, but still deeply negative. Easy to blame regulation for all the woes in Chinese equities, but a weak backdrop is most likely exacerbating market moves.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@VKMacro A bit worried about the FX exposure though. At least for a USD investor.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@AndreasDagasan Drop in bond yields has been a strong support, but yeah the persistent negative equity-bond correlation isn't really a healthy sign.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@shehzadhqazi In my experience imports components are generally quite good at capturing domestic demand (e.g. ISM imports components tend to capture GDP growth better than others). Imports are ofc also a key way in which Chinese macro affects RoW.

[Sebastian Dypbukt Källman @sdypbuktkallman]

🇨🇳 Chinese PMIs disappoint, and there's more where that came from.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@HBGrimes Thanks mate. No report, just from my chart deck.

[Sebastian Dypbukt Källman @sdypbuktkallman]

@CavaggioniMario Is there such a thing?

[Sebastian Dypbukt Källman @sdypbuktkallman]

🇨🇳 Weak trend in Chinese money/credit data persists. Probably contributes to the loss of momentum in inflation expectations, but given US macro strength it will have less impact on real yields (and not be the death of the value trade).