Stuck in neutral: What's next?

Neutral

Aggregate equity positioning is massively neutral here.

Source: DB

Fast money

CTAs have sold equities aggressively...but this has been a reduction in longs. They are running small underweights here.

Source: DB

Mostly upside

The bigger CTA convexity over the 1 month is the upside...

Source: GS

SPX - where are we?

SPX remains trading inside the perfect trend channel that has been in place since July highs. We basically bounced on the 200 day in early October and are now once again closing in on the upper part of the channel. Also worth noting is that the 50 day crossed the 100 day right here.

Source: Refinitiv

Fear - the only thing moving

We outlined just how stressed volatility was on Friday (here). SPX is basically trading at the same levels we traded at last Tuesday, while VIX has been all over the place. The extreme VIX richness from Friday has faded...

Source: Refinitiv

Crashing breadth

NASDAQ's cumulative advance/decline line continues puking. Is this even possible?

Source: MS

Earnings as well

Earnings revisions breadth falling off a cliff as well.

Source: MS

Fat vs luxury - perfect substitutes?

LVMH vs Novo gap getting extreme. Is there cross asset logic here, or is it just hot money switching from one ex hot asset to another "must have" asset?

Source: Refinitiv

What can drive Novo higher from here?

"With the stock up considerably last week, more investors are asking who is the incremental buyer and what drives the stock higher from here? While some generalist investors are likening the obesity thematic to the AI hype, with Novo consistently delivering on earnings upgrades and further upside to 2024 to come (c.11% on EPS), the trade may have further room to run. I can see the argument to trim the long in the ST, with signs of HF and LO profit taking through our desks. The next catalysts are: (1) the SELECT data at the AHA meeting 11-13 Nov – good news is in the price but hopes lie on the data suggesting scope fort expansion into new disease indications and (2) a potential inflection in Wegovy weekly scripts (most investors are pointing to an inflection around end of yr)." (MS specialist sales pharma)

Small business - Big interest payments

We estimate that small business interest payments are likely to increase to around 7% of revenues by 2024, then gradually rise to around 8%.

Source: Goldman

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