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On January 16th, a research report from CITIC Securities stated that the Peoples Bank of China (PBOC) lowered the interest rates of various relending tools by 25 basis points. However, this measure is not a traditional reduction in the reverse repo rate or LPR (Loan Prime Rate), but rather a targeted effort through structural tools. We believe this move will help boost banks lending activity, promote stable credit growth, and alleviate pressure on bank interest rate spreads to some extent. Regarding aggregate policy, the PBOC indicated that there is still room for reserve requirement ratio (RRR) and interest rate cuts this year. However, given the continued strong export performance and relatively strong short-term economic momentum, we expect short-term policy easing to be restrained, with the total reduction in the reverse repo rate for the year likely to be around 10 basis points. As for exchange rates, the PBOC continues its policy stance of "maintaining basic stability at a reasonable and balanced level." We believe that in the short term, the policy focus remains on preventing exchange rate overshooting, improving expectation management, and enhancing enterprises exchange rate hedging capabilities, rather than gaining a trade competitive advantage through exchange rate adjustments.On January 16th, CITIC Securities pointed out that new social financing in December 2025 was 2.21 trillion yuan, a decrease of 0.65 trillion yuan year-on-year. The decline in social financing year-on-year was in line with expectations, due to government bond issuance leading the way and weakened support from a high base. Corporate lending improved marginally in December, likely mainly due to banks proactive pre-launch project preparations. Retail lending remained sluggish, with expectations for a recovery in demand driven by macroeconomic recovery and coordinated policy efforts. The proactive fiscal policy and relatively loose monetary policy are expected to continue in 2026, with government bonds remaining a significant driver of social financing growth. Credit growth is projected to remain around 7%-8% in 2026, but a genuine improvement in bank fundamentals will require further improvement in credit demand and economic expectations.On January 16, the U.S. Senate passed a bill approving billions of dollars in funding for several federal research agencies, rejecting the Trump administrations proposed budget cuts to research and space programs. Under the bill, the National Science Foundation (NSF) will receive $8.75 billion for research in areas such as quantum information science and artificial intelligence, significantly higher than the White Houses proposed 57% budget cut. Democratic Senator Van Hollen stated that the funding will support nearly 10,000 new research projects, covering more than 250,000 researchers, faculty, and students.European Central Bank Chief Economist Lian: Current interest rate levels set a benchmark for the coming years. If the benchmark scenario holds true, there is no discussion of interest rate changes in the near term.Sources say a bipartisan group of governors will sign an agreement with the Trump administration on Friday to curb rising electricity costs in the PJM region, which covers 13 states. The agreement would cap future electricity auctions for two years and mandate that data centers share more of the financial burden of expansion.

Utilities Rising & Transporters Sinking – Sector Rotation Is Providing Clues

Cory Russell

Apr 12, 2022 11:09


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DAILY COMPARISON CHART FOR SPY - SPDR S&P 500 ETF TRUST

Please notice the exact positioning of the Transportation, Precious Metals, Energy, and Utilities sectors as we examine our cycle graphic.


We'd like to pay specific attention to the Transportation industry, which is depreciating while the Utility sector is appreciating.


These industries may tell us a lot about where we are in the current economic cycle.


YTD, THE UTILITIES SECTOR IS UP +7.50%.


The Dow Jones Utility Average exceeded 1,000 for the first time in its almost 100-year existence in March 2022, indicating that the utility sector is outperforming the market this year.


Many investors feel the XLU is the most effective risk-reducing equities ETF on the market, and they may be turning to the utilities sector as a safe-haven investment.


Gold, the US dollar, and the Swiss franc are three other safe-haven assets we're keeping an eye on.

SPDR SELECT SECTOR ETF (XLU) DAILY CHART OF UTILITIES

YTD, THE TRANSPORTATION SECTOR IS DOWN -15.92%.

From its high in November 2021, the transportation industry has decreased by around -21.59 percent.


From peak to trough, market cycles are counted. When a stock index's closing price declines by at least 20% from its high, traders consider it to be in a bear market. The reduction in the XLU from 100.00 to 80.00 equals 33.33 percent of the whole bull market advance in 2020-21.


The US Department of Labor said on April 1st that the number of truck transportation employment decreased in March after 21 months of growth. Then, on April 8th, Bank of America (NYSE: BAC) downgraded a number of transportation equities, citing "waving demand and price drops" as the reason. "Given weakening demand outlooks and quickly decreasing freight rates, we cut ratings on 9 of the 28 equities in our covered universe," Bank of America analyst Ken Hoexter told clients.


Because economic demand shows up first in shipping orders, the transportation index was devised in July 1884 by Charles Dow and has long been regarded as a leading indication of the overall market's direction. Historically, a drop in freight has signaled the start of a widespread economic downturn.

DAILY CHART KNOWLEDGE, WISDOM, AND APPLICATION ARE REQUIRED FOR XTN - SPDR S&P TRANSPORTATION ETF.

It's vital to note that we're not claiming that the market has reached its peak and is now heading down. This post will throw light on several fascinating studies that you should be aware of. We track price simply as technical traders, and once a new trend has been proven, we will adjust our positions appropriately. We share our ETF trades to our subscribers, and of the six trades we placed this month, five have closed at a profit, one is still open, and we've locked in half gains on that one as well! Our algorithms are constantly monitoring price movements in a wide range of markets, asset classes, and worldwide money flows. As fresh information regarding trends or changes in trends is generated by our models, we will quickly disseminate these signals to our subscribers and those on our trading weekly email list.


When it comes to trading, it's not just about knowing when to purchase or sell stocks or commodities. When it comes to being a consistently effective trader, money and risk management are crucial. Stop-loss orders, when used correctly, enable to protect your investment money and allow traders to manage their portfolios according to their specified risk boundaries. Scaling out of positions by taking gains and adjusting stop-loss orders to breakeven may also help a trader succeed.

WHAT STRATEGIES CAN ASSIST YOU IN MANAGING CURRENT MARKET TRENDS?

Learn how we employ unique methods to find strategic entry and exit locations for trades by understanding market cycles, set-ups, and price target levels in different sectors. We foresee extremely big price fluctuations in the US stock market and other asset classes throughout the world during the next 12 to 24 months. We think the markets have entered a revaluation period as global traders strive to discover the next significant trends, moving away from the sustained central bank support rally. As traders and investors seek safe havens in Metals and other safe havens, precious metals will likely begin to operate as a good hedge.

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