Midweek Macro Note: Blowoff or Blowup, CAPE, Housing Flash, Vision Desk Note + Commentary

In this Midweek Macro Note the team dives into asset price tailwinds and headwinds combined, looks at the latest housing sector red flags, talks technicals, the Vision Team delivers a note, and more.

Good Wednesday evening MacroEdge Readers & Community,

This evening in our Midweek Macro Note we’ll take a look at some of the latest for valuations - looking at the latest CAPE data, along with the technicals for the Nasdaq, homebuilders + the latest housing data from this am’s release, and the Vision Team’s Six will provide an update direct from our investment research desk.

This week for important macro data we’re still awaiting the Philadelphia Fed Prices Paid Diffusion Index, which arrives tomorrow, and we’ll publish the latest Raw Materials Price Index… There are also Jobless Claims, Japanese/German Inflation data, housing, S&P Global, and consumer inflation data on Friday. Of this batch, UMich Consumer data and Japanese Inflation data are the most important. Today in the FOMC minutes we saw the Fed become more cautious about the pace of QT, which sent stocks slightly higher, and New Zealand cut rates by 50 basis points amid their employment crisis that has sent thousands of native New Zealanders leaving the country for opportunities in other Commonwealth (and non) countries. The housing data in the United States came in cool, with mortgage applications remaining near cycle lows and absolute per capita lows, throughout the history of the MBA dataset. It’ll take rates and prices moving to get volume back in the housing sector. Homebuilder stocks also have taken a hit (something we discussed about 2 months ago in a technicals roundup) with particular stocks like Lennar down ~40% from their cycle highs. With that - let’s dive into the data & my thoughts on the above items.