JPM, Citi, UBS, and now one of the Wall Street strategists whose perspective we respect the most, BofA's Michael Harnett, who quite clearly disagrees with the official BofA "straight to CNBC" mouthpiece Savita Subramanian, is out with a note in which he is telling reders to get out of stocks, go into cash expecting a short sharp pullbacks in risk assets (e.g. SPX to 1850-1900), and be long volatility.
From his report:
Canada's Ivey Purchasing Managers Index collapsed from an exuberant and simply unbelievable 63.6 in November to a contractionary 49.9 in December - one of the biggest MoM drops on record and biggest misses on record. On a seasonally-unadjusted basis, this is the weakest print in at least 2 years. From the best data since February 2012 to the worst since February 2015 seems to expose these soft-surveys as practically useless. The huge drop in Inventories suggests a major drag on GDP and an extension of Canada's recession.
Dr. Copper is sick. For the first time since May 2009, Copper futures prices traded with a $1 handle this morning ($1.99) as Nomura analysts warn the commodity is likely to see more downside risk over the medium term as the market is expected to remain in surplus through the end of the decade.
As Bloomberg adds, Nomura's Patrick Jones warns:
Update: China folds - CHINA SUSPENDS STOCK CIRCUIT BREAKER RULE
As we detailed earlier...
Via Dana Lyons' Tumblr,
Today saw a slew of significant levels related to the post-2009 bull market break on several key stock indices.