Head of Research, Steno Research

Emil Moller

Head of Research

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Thematic (Sector/Industry)

<ul><li>Recently the FED released its H4 recently which bears some interesting insights into the state of the US banking sector.</li><li>The Reverse Repo facility has been squashed since May while the bank reserves have remained relatively stable.</li><li>We are not at all surprised by the banks’ continued caution throughout the summer, and we expect this risk-averse attitude to persist in the coming quarters.</li></ul>

Recently the FED released its H4 recently which bears some interesting insights into the state of the US banking sector.The Reverse Repo facility has been squashed since May while the bank reserves have remained relatively stable.We are not at all surprised by the banks’ continued caution throughout the summer, and we expect this risk-averse attitude to persist in the coming quarters.

Global Multi-Asset Investment Strategist, True Insights

Jeroen Blokland

Global Multi-Asset Investment Strategist

Build Well-Diversified Multi-Asset Portfolios

True Insights

Our research helps investors build well-diversified multi-asset portfolios and profit from market developments. In addition, our unique and proven Macro – Sentiment – Valuation (MSV) investment framework ensures a consistent flow of new investment opportunities. Together with our market views, these opportunities will be reflected in our live ETF-based Global Multi-Asset Portfolios.

Cross Asset Strategy

<ul>
<li>The Federal Reserve raised interest rates by another 25 basis points, expecting inflation to come down 'not so quickly.'</li>
<li>Powell feeds the overly-enthusiastic market narrative by betting against history, anticipating that the current Fed tightening cycle will not significantly push up the US unemployment rate.</li>
<li>Powell and the Fed dodged accountability back in February, and the PacWest collapse hours after stating banking 'conditions have broadly improved' is very painful and disturbing.</li>
</ul>


The Federal Reserve raised interest rates by another 25 basis points, expecting inflation to come down 'not so quickly.'
Powell feeds the overly-enthusiastic market narrative by betting against history, anticipating that the current Fed tightening cycle will not significantly push up the US unemployment rate.
Powell and the Fed dodged accountability back in February, and the PacWest collapse hours after stating banking 'conditions have broadly improved' is very painful and disturbing.


Powell Press Conference: Persistent and Painful

Macroeconomics

<ul>
<li>Laeven and Valencia (2012, 2018, 2020) provide an empirically sound framework to determine if a banking crisis should be defined systemic.</li>
<li>The first condition of a systemic banking crisis - significant signs of financial distress in the banking system - has been met.</li>
<li>The second condition of a systemic banking crisis - significant banking policy intervention - has not been met, including the impressive intervention of the SNB in the Swiss banking system.</li>
</ul>


Laeven and Valencia (2012, 2018, 2020) provide an empirically sound framework to determine if a banking crisis should be defined systemic.
The first condition of a systemic banking crisis - significant signs of financial distress in the banking system - has been met.
The second condition of a systemic banking crisis - significant banking policy intervention - has not been met, including the impressive intervention of the SNB in the Swiss banking system.


An Evidence-Based Framework to Determine if This Is a Systemic Banking Crisis

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>The S&amp;P 500 (SPX) is back to test YTD highs and important resistance in the 5670-5783 range. This is an important target/resistance area we have discussed for weeks.</li>
<li>Using the 2007 SPX topping analog suggests a 2% or less move above the prior all-time high set in July at 5670 before topping, which gives the 5783 number.</li>
<li>As long as SPX does not have a weekly close above 5783 we continue to recommend reducing risk and shifting to defensives,and this is the ideal time to do so.</li>
</ul>


The S&amp;P 500 (SPX) is back to test YTD highs and important resistance in the 5670-5783 range. This is an important target/resistance area we have discussed for weeks.
Using the 2007 SPX topping analog suggests a 2% or less move above the prior all-time high set in July at 5670 before topping, which gives the 5783 number.
As long as SPX does not have a weekly close above 5783 we continue to recommend reducing risk and shifting to defensives,and this is the ideal time to do so.


SPX Testing Resistance as Rate Cut Cycle Begins; SPX 5670-5783 Is Resistance, 2007 Analog on Track

High Conviction Concentrated Growth Investing, Fallacy Alarm

Fallacy Alarm

High Conviction Concentrated Growth Investing

High conviction concentrated growth investing. Blends single stock, macro and thematic research into powerful long and short ideas. I am convinced that a robust and comprehensive investment process requires macro and micro considerations. And it requires a deep understanding what you are looking for and what you are invested in. Digitization has changed the dynamics both how businesses operate and how investors compete for returns. Ideas can scale much faster and fail much faster than before. The biggest value creation happens before it can be spotted in financial statements. As a result, my approach can be best summarized as high conviction, high concentration growth investing, embedded into a macro framework built on the realization that our current demographic set-up, monetary paradigm and innovation cycle will likely deliver a strong decade for nominal and real returns of productive assets.

Equity Bottom-Up

<ul><li>Fiscal spending has been the key driver for this bull market as it reaccelerated in late 2022 following the inflation and subsequent interest rate shock.</li><li>This impulse will likely diminish over the next months. It will be replaced by a credit impulse from rate cuts, the first few of which will be very powerful.</li><li>Market mechanics will be accommodating. Leverage in the system is low. In fact, the pain trade is still higher.</li></ul>

Fiscal spending has been the key driver for this bull market as it reaccelerated in late 2022 following the inflation and subsequent interest rate shock.This impulse will likely diminish over the next months. It will be replaced by a credit impulse from rate cuts, the first few of which will be very powerful.Market mechanics will be accommodating. Leverage in the system is low. In fact, the pain trade is still higher.

United States

SPDR S&P Regional Banking ETF is an exchange-traded fund incorporated in the USA. The Fund's objective is to replicate as closely as possible the performance of the S&P Regional Banks Select Industry Index, an equal-weighted index.

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SPDR S&P Regional Banking ETF (KRE US)

Macro Nugget: US Banks

Recently the FED released its H4 recently which bears some interesting insights into the state of the US banking sector. The Reverse Repo facility...

Steno Research

Powell Press Conference: Persistent and Painful

Powell is not thinking about rate cuts, contrary to what markets believe. Unfortunately, he also thinks banking conditions have 'broadly improved.'

Jeroen Blokland

An Evidence-Based Framework to Determine if This Is a Systemic Banking Crisis

There is ample empirical data available on banking crises to make a well-informed judgment if we are in one or heading for one.

Jeroen Blokland

SPX Testing Resistance as Rate Cut Cycle Begins; SPX 5670-5783 Is Resistance, 2007 Analog on Track

$SPX Testing Resistance as Rate Cut Cycle Begins; SPX 5670-5783 is Resistance, 2007 Analog on Track if Below 5783. Still Neutral, prefer to sell...

Vermilion Research

Fallacy Alarm's Elevator Pitch Party

Fiscal spending has been the key driver for this bull market as it reaccelerated in late 2022 following the inflation and subsequent interest rate...

Fallacy Alarm

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