Good morning and welcome to December. S&P futures are looking more like Rudolph’s nose than Buddy the Elf’s coat as equities stumble into the last month of the year. Last week was a show of strength built on technical milestones. The S&P 500 finished up 4%, including a 0.5% gain on a shortened Friday trading session that was highlighted by an intense Connect 4 tournament on the Trading Floor during Kids Day. The index reclaimed the 50d moving average, with the 100d ma holding as key support. Mastercard’s latest SpendingPulse report showed the US consumer remained resilient but isn’t doing much to help markets start the week. Black Friday sales rose 4.1% y.y, with e-commerce growing 10.4% and in-store +1.7%. Spending on apparel was particularly strong, according to the analysis. Sovereign yields are following Japan’s lead higher, adding to the pressure on equities. Treasuries are up 5-6bp at the long-end but the Dollar is trading lower against major crosses. Data today will focus on ISM Manufacturing after the Open. Final S&P PMIs will be out after the Open as well. The Pick Is In for the nominee for the next Fed Chair according to President Trump, although he has not announced it yet. NEC Director Kevin Hassett is viewed as the favorite. After a respite last week, crypto is getting smoked again. Bitcoin is down 5% to ~$86k with most of the losses coming during Asian hours. Over the weekend China’s PBOC reiterated that digital assets remain illegal in the country and seemed to single out stablecoins in the communique. The Nikkei fell almost 2% as rates rose across the curve and the yen strengthened following hawkish commentary from the BOJ. Meanwhile, FX intervention continues to be floated by government officials.

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