SocGen: "We Have Gone From Indiscriminate Selling To Indiscriminate Buying In One Month"

Zero Hedge | 2/1/2019 | Staff
smnth28 (Posted by) Level 3
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Late last year, Deutsche Bank published what may have been the iconic chart that captured the prevailing investing zeitgeist: it showed that 2018 was the worst year on record on terms of the percentage of global assets down on a dollar adjusted basis - with roughly 93% of all assets down for the year, worse even than the years of the Great Depression. Indeed, 2018 was the year when "nothing worked."

But while December may have been the worst month since the Great Depression, Powell's full dovish capitulation and loss of all credibility in January, resulted in a violent reversal for the S&P in January, which in turned was the best start to the year since 1987 (a year which is far better remember for another market event).

January - September - July - October

which happened in January 2012, September 2009, July 2009 and October 2007.

Amusingly, as Deutsche Bank strategist Craig Nicol writes, "as one would expect, it's rare to have a month where risk assets and rates rally." Actually, no: since this is what is known as the "QE trade", when a dovish shock from the Fed leads to a surge in all assets coupled with a plunge in the dollar - precisely what we observed in January - it is not that rare to have a month like this in the new normal, when central bank intervention has been the primary source of equity upside in global markets. In fact, for an entire generation of traders, one could say that it is far more rare to see a month like December when the S&P dipped into a bear market for the first time in a decade... if only for a few seconds.

Case - Deutsche - Bank - January - Month

In any case, as Deutsche Bank adds, January "is the best broad-based month for performance in markets since we started collecting data nearly 12 years...
(Excerpt) Read more at: Zero Hedge
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