The Show Must Go On
Vol IX, Issue 24 | A NPB Original
“You must go on. I can’t go on. I’ll go on.”
— Samuel Beckett, The Unnamable
It is time for the end-of-month/quarter issue of the Quotedian and even though I am physically and equipment-wise strongly constrained this week …
… THE SHOW MUST GO ON!!
So, please forgive me for making this issue mainly one full of stats and maybe some charts, but for sure very little of my usual blabbering, as typing is truly a burden given my current setup. But maybe, you are actually quite happy about that?! 🤬
Whatever the case, let me give you the link to Queen’s formidable “The Show must go on” 1991 hit, which is the perfect accompanying listen whilst you ‘read’ through the rest of the document:
So, hand on heart, who would have thought that equities (MSCI World TR USD) will see their best quarterly returns since 2020 and their third-best outcome in a decade?
Here are the monthly returns of some of the most popular equity benchmarks around the globe:
And here are the quarterly returns of the same:
That ascent in the monthly chart of the KOSPI feels unprecedented:
However, the June candle suggests that things are getting a little too wonky.
In terms of sector performance, and starting with the quarterly perspective, tech, probably led by the AI-cohort, continues to outshine everything else.
Energy stocks, the laggards, warrant a special mention. It is all good and right that a MoU has been found and we hope that the peacefire (no typo) will hold up beyond the two days after US mid-term elections….
At least, the Strait of Hormuz traffic lights seem to have switched to green again:
But, if anything, the temporary closure of the SoH has shown the fragility of energy (and other) supply chains, which begs two rhetorical questions:
Will net oil importing countries increase or decrease their strategic energy reserves over the coming months to years?
Will alternative energy infrastructure routes be built or are we fine now that the SoH is fully open again?
I don’t know about you, but I will be looking at these energy assets on further price weakness…
But back to the nicer, shinier, less-contaminating world of tech stocks, where of course semiconductors currently stand out, just having produced their best quarterly performance … EVER:
Looking at some of the popular investment themes, well, most of them were apparently not so popular in June:
However, it is important to never lose the long-term perspective and your conviction about a trend/theme:
Talking of which, was June the month to pick up on the Lag 7 stocks?
Factor performance shows that growth and momentum continue to lead, but US small cap is raising its hand to get attention too now:
Finally, here’s our usual list of stocks which you should have bought at the beginning of the year. But you know what, before you call me a smartarse, you could even still have bought them only at the beginning of June, having all the benefit of 20/20 hindsight, and still outperformed the market handsomely … on the month and year-to-date!!!
Here’s the US list:
And here the European one:
The quarter just ended has been pretty nice to bond markets, especially from a credit risk point of view:
June largely reflects the quarterly picture:
On the US 10-year Treasury yield we are still waiting for that break higher out of the multi-year consolidation triangle:
Whilst still likely, a pull-back lower first remains a high probability scenario.
Turning to currency markets, the pain-trade for the US Dollar is now clear, and it was to the upside, as the Greenback strengthened against nearly every other currency in June:
The US Dollar Index (DXY) seems to have broken out of its range for good:
But the US Dollar strength was especially felt in commodities, which also coincided with a temporary reversal in our “Age of Empires” trade:
Which leads us to that burst bubble that is Gold:
You will ask, should I buy this after the correction down to the first Fibanocci retracement point?
To which I answer: Would you buy or sell this?
Unfortunately, I need to cut short here, but hope that some of these stats and graphs were still useful.
As useful, stay tuned for new issues of The Quotedian - Weekly and Daily edition coming to a theatre near you soon.
Take care out there and may the trend be with you!
André
Everything in this document is for educational purposes only (FEPO)
Nothing in this document should be considered investment advice
Investing real money can be costly; don’t do stupid shit
Leave politics at the door—markets don’t care.
Past performance is hopefully no indication of future performance
The views expressed in this document may differ from the views published by NPB Neue Privat Bank AG