Jun 4, 2024 8:39 am
There was quite a dispersion of economic data surprises around the world through May. Europe was the positive standout, with evidence of ongoing improvement in economic growth. Japan’s economic data deteriorated sharply at least until right at the end of the month when retail sales beat expectations. However, generally through the month Japan saw disappointing…
Read MoreMay 28, 2024 11:42 am
• Market debate remains on stickiness of inflation and slow pace of US rate cuts • US market concentration in big tech signals potential problems, but the sector continues to deliver • Old economy stocks struggle • UK’s Independence Day general election US bank leaders’ statements of caution We generally don’t echo the opinions of…
Read MoreMay 21, 2024 10:13 am
• We still worry about US stagflation • We remain positive on European equities – lower inflation helps • Chinese equities challenged by weak data, but government action in the real estate sector provides support • Japan disappoints on growth but equities helped by reform • NVIDIA quarterly results likely to show that growth momentum…
Read MoreMay 15, 2024 9:34 am
• Fed almost rules out a rate hike; the market still expects two rate cuts, starting September 2024. • Geopolitical tensions escalated in the Middle East in April but now seem to have stabilized. • India’s PMIs are near all-time high, underscoring its economic resilience. • Q4FY24 earnings of Indian companies are broadly in line…
Read MoreMay 14, 2024 7:12 am
• Stagflation alarms in the US as household confidence drops sharply but inflation expectations inch up • Europe’s building growth story – strengthening consumer spending could pull the economy out of recession • China’s growing list of positives: (a) possible government stimulus, (b) potential QE, and (c) a sharp increase in share buybacks • Elections…
Read MoreMay 7, 2024 6:51 am
• Worse-than-expected US employment data leads to anticipation of rate cuts from September, aligning with a Goldilocks scenario. • Lower-than-expected US jobs growth offsets concerns from stronger inflation reports. • China’s potential quantitative easing boosts Chinese equities but risks upsetting the Goldilocks scenario. • Traders may see a growth surge and risk-on sentiment, especially in…
Read MoreApr 30, 2024 5:32 am
• US growth surprises to the downside but no one quite believes it • US inflation still persists • FOMC – expect more about the words than the action • Focus on ex US equity markets • China is back Last week’s US economic data showed that you can’t have entrenched views or exaggerated portfolio…
Read MoreApr 26, 2024 5:27 am
The year gone by • Markets continued to touch new highs in the quarter gone by. • Close to two-fifths of the index’s annual return can be attributed to the Public Sector Enterprises (PSEs). • The past year witnessed low-quality businesses outperforming high-quality ones. • A year of underperformance by itself isn’t sufficient reason to…
Read MoreApr 23, 2024 6:33 am
• Challenges of higher for lower sees repricing of assets • US 10 year government bond yield in a new trading range • Dollar strength a challenge for EM policy makers • US smaller cap sentiment at 11 year low • Spring Wolrd Bank and IMF meetings focussed on the right issues? Markets continued their…
Read MoreApr 16, 2024 8:12 am
In Summary Inflation in the US remains a persistent issue and cannot be easily dismissed. The once hopeful scenario of the Federal Reserve implementing gradual rate cuts throughout 2024 now appears overly optimistic. It’s increasingly probable that the Fed will make minimal adjustments to rates – or perhaps none at all. There is also a…
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