In the week ending December 18th, on Wednesday when the Fed cut rates, panic selling returned.
Large-cap funds saw $20.9 billion of outflows, ending a 6-week streak of inflows.
Outflows in small-cap, multi-cap and mid-cap funds were $5.4 billion, $3.9 billion and $2.9 billion. pic.twitter.com/q0etlJoGlq
— The Kobeissi Letter (@KobeissiLetter) December 21, 2024
Many were caught off guard by what appeared to be a "sudden" shift in Fed policy.
Fed officials revised rate cut outlook in 2025 from 3 cuts down to 2.
Even worse, Fed Chair Powell said the 25 bps rate cut on Wednesday "was a closer call."
We warned about this weeks ago. pic.twitter.com/gulbtADIDg
— The Kobeissi Letter (@KobeissiLetter) December 21, 2024
This sent rippled effects through all markets, and the US Dollar strengthened to new 52-week highs.
The Canadian Dollar is now at its weakest point again the US Dollar since March 2020.
The US Dollar is nearing its strongest level against the Canadian Dollar since the 1990s. pic.twitter.com/7GxgDlDz3s
— The Kobeissi Letter (@KobeissiLetter) December 21, 2024
Global yields looking ominous. pic.twitter.com/00BECLZ4en
— The Great Martis (@great_martis) December 21, 2024
Europe in serious trouble. pic.twitter.com/uAv6TrgVea
— The Great Martis (@great_martis) December 21, 2024
🇺🇸 US Conference Board Leading Economic Index -17.6% off previous peak.
In #recession territory!
Chart: @Vetta_Fi pic.twitter.com/qh9B98kGbI
— Alex Joosten (@joosteninvestor) December 21, 2024
A Christmas stuffing?!… what #China's collapsing bond market might be telling us @Jkylebass @johnauthers World GDP nowcast (orange) and People's Bank #PBOC #Liquidity +3months. Whoops pic.twitter.com/fitIgTxEjj
— CrossBorder Capital/ GLIndexes (@crossbordercap) December 21, 2024
🇨🇳 China property sales tumbling!
Chart: @Bloomberg pic.twitter.com/vrXoZyri0m
— Alex Joosten (@joosteninvestor) December 21, 2024
Probably nothin"!
US Market Cap % Of GDP: pic.twitter.com/M2uFaeVYJD
— David Stockman (@DA_Stockman) December 21, 2024
This week saw the fabled Hindenburg Omen generate its first major sell signal in three years, suggesting the endless bull market of 2024 may soon indeed be ending. Why is this indicator so widely followed, and what does this confirmed signal tell us about market conditions going… pic.twitter.com/KmEoo9B94z
— David Keller, CMT (@DKellerCMT) December 21, 2024
BREAKING 🚨: Starbucks$SBUX has now declined for 7 consecutive days pic.twitter.com/J7c0sOCsmy
— Barchart (@Barchart) December 22, 2024