This Week: CPI And Bank Earnings

Good Morning Everyone!

Hope you're ready for another short squeeze. Bed Bath & Beyond stock is up 20% pre-market after the company said it was heading for bankruptcy last week.

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Prices as of 4 pm EST. 1/6/23; % YTD

MARKET UPDATE

Today:

Positive headlines out of China
Offset by
2023 earnings estimates at risk as Q4 results begin this week

This week:

Thursday CPI
Friday U.S. bank earnings

Q4 earnings kick off on Friday

JP Morgan JPM, Citi C, Bank of America BAC, Wells Fargo WFC

Today: RBC Canadian Bank CEO Conference

Today: Management group seeking to take Canaccord Genuity private

Today: Goldman Sachs GS to eliminate 3,200 jobs (largest cut ever)

Issues going into the bank Q4 quarter:

Higher credit provisions
Higher expenses/comp inflation
Higher deposit funding
Mild recession (see chart below)
Focus: management forward guidance during Q4 results

2-10 curve is extremely inverted

Getting to 1980 levels
Most investors calling for a mild recession later this year

What’s the U.S. dollar doing?

Crude 76 +3%

Oil up on news:
- China re-opened air, land and sea borders on Sunday
- China increased crude oil import quotas for China’s refiners

Apple AAPL

Expects to be exporting more than $2.5 billion iPhones from India from April to December
Nearly twice the previous year
Trend: accelerating shift from China with geopolitical tensions on the rise

Earnings None

CRYPTO UPDATE

Digital asset fund flows

Outflows continue, $9.7 million
3rd consecutive week
Bitcoin BTC/USD: -$6.5 million
- Volumes remain low, ~$5 billion per day
  - 2022 average = $9 billion
Short-Bitcoin: +$1.2 million
Ethereum ETH/USD : -$3.1 million
XRP: +$3 million
- Suggests legal case with SEC could be heading towards positive outcome