Traders continue to cut their cyclical bets

Cyclical positioning indicator lowest since mid-2020

Chart of the Day

Macro

The latest job reports showed the US labor market added 559,000 jobs in May, which wasn’t as good as some hoped following the much better ADP report on earlier that week. The US employment recovery is still slowing catching up with Canada's though, where employment fell.

A weighted average of the ISM employment indices has dropped recently, a concerning sign for the outlook perhaps.

The unemployment rate in the US is relatively low, because many more people dropped out of the labor force.

TSA traveler throughput is now 32% below the pre-Covid peak, basically entirely due to international travel.

Markets

It was a solid week for energy stocks after oil broke out of its recent trading range.

Tech stocks did ok as well, despite little move in real rates.

The European indices have outperformed the S&P 500 over the past month, though no thanks to the moves on Friday.

Traders have drastically trimmed their net short in 30-year Treasuries - losing faith that yields will rise?

Traders also continue to cut their net longs in copper.

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