Market Flash Falling temperatures have exacerbated the global sanitary situation. In Europe, Germany and the UK reinforced restrictions. Cases have also started rising again in Asia, a worry for Japan and South Korea which had managed to control the first
Market Flash Markets continued to focus on waning epidemic and political risk. Astra Zeneca unveiled a Covid vaccine that looks promising and simple to use. Governments are gearing up to start vaccination campaigns in the next few weeks. In the
Market Flash Markets are in wait-and-see mode. Investors are waiting to see a new stimulus plan in the US, the presidential election results, progress in finalising Brexit and positive developments in the search for a coronavirus vaccine. They are also
The financial panic caused by Covid-19 and the halt in the global economy have been brought under control thanks to budget plans and monetary action by central banks. Having seen the dollar plummet at the height of the crisis, accelerated
Market Flash Joe Biden has continued to widen his poll lead since the first TV debate and the news that Donald Trump had gone down with Covid. Online sites have him at 65% vs. a mere 35% for Trump. Biden
Market Flash All eyes were on central banks. As expected, the Fed left its rates unchanged. It even said they would not move until inflation rose above 2% and stayed there for some time, a situation it does not expect
Market Flash US equities broke fresh records as new Coronavirus cases fell sharply and the overall sanitary situation improved. The contrast was strong with Europe where there was a surge in new cases even if the number of people on
Our new macroeconomic scenario is based on theoretical analysis of previous flu epidemics and not on the general equilibrium models used by international institutions. We forecast a less pronounced decline in activity in 2020 but also a weaker rebound in
Market Flash The week start got off to a strong start thanks to two positive developments. Angela Merkel and Emmanuel Macron announced a plan to boost the European budget by €500bn to help countries and sectors which had been the
FLASH What do we know about Coronavirus Covid-19 at this stage? There is still some uncertainty over its toxicity as data from the Hubei province are very different from other affected countries. For example, the mortality rate ranges from 0.1%,
Market Flash Risk appetite returned in force over the period as a number of countries unveiled plans to ease lockdown measures, encouraging investors to anticipate a gradual recovery in activity. S&P amplified the trend by maintaining Italy's rating and its
Special Flash Over the last week, markets have already suffered trading days with vertiginous falls amid chaotic trading. On March 12, most equity markets tumbled by more than 10% and even safe havens like 30-year US Treasuries lost more than
Market Flash What a week! After Saudi Arabia’s surprise decision to massively increase oil supply despite a collapse in demand, Donald Trump decided quite simply to cut off the US from most of Europe. Fortunately, the FED, the BoE, the
Market Flash The coronavirus outbreak dominated trading, triggering risk aversion, weighing on global equity markets and accentuating the move down in bond yields which kicked off at the beginning of January. The epidemic continued to spread in China, forcing the
Markets stuck close to all-time highs despite a resurgence in risk-off sentiment. This was prompted by: First, sanitary concerns after confirmation that China's coronavirus could be spread between humans. The situation might seem to echo the period in 2003 when the
Even without an increase in tension with Iran, global growth this year should slow further due to the US presidential campaign, higher customs tariffs remaining in place and Chinese abnegation. THE TRADE WAR SHOULD CONTINUE TO AFFECT GLOBAL GROWTH The
Equity markets continued to push higher and credit spreads tightened in November as economic data stabilised or improved. Sentiment was also boosted by a crop of political comments suggesting the US and China would soon sign a Phase 1 agreement
Market flash Hong Kong’s pro- democracy party won 85% of the seats in the local elections, a massive increase on the 25% seen in 2015. A few days later, Donald Trump signed the Hong Kong Rights and Democracy Act into
Market Analysis and Principal Investment Themes These cyclical shifts are based on: Encouraging declarations over a first phase agreement in the US-China trade talks; A much reduced risk of a hard Brexit in the short term; and A few PMI
The big news item of the week was Germany’s third quarter GDP which rose 0.1%, narrowly missing a move into recessionary territory. Expectations were for a 0.1% drop and second quarter GDP was revised down to -0.2%. However, over a
The recent drop in political risk is a significant shift in a climate of almost constant one-upmanship. It is highly likely that hopes over a US-China deal and the diminishing risk of a hard Brexit mainly reflect the willingness of all concerned
As measured by the MSCI World All Countries index in local currencies, equities have stalled again. The index level is pretty much the same as it was in July and May this year, indeed it is only up a couple
Brexit commotion dominated market sentiment after the agreement reached by Boris Johnson failed to go to a vote in the Commons over the last weekend. The UK prime minister eventually got a majority for his text but accelerated adoption was
Current news is focusing on an issue that nevertheless concerns an expected long-term time horizon, i.e. 2030-2100. The issue of climate change and the challenge of limiting global warming to +2.0°C, even less if possible, on the only planet we
Risk assets were lifted this week by the partial US-China agreement and hopes of a solution to avoid a no-deal Brexit. The US-China agreement stipulated that Washington would not raise tariffs on $250bnworth of Chinese imports by 25-30% on October
Equity markets rebounded this week while bonds experienced a correction. Investors continue to attempt to gauge the reality of the deterioration in global manufacturing activity and the impact of the countermeasures in the form of monetary and fiscal support. Short-term
The economic and political climate is glum, and things continue to worsen. Although we do not predict a recession in the foreseeable future, we nevertheless cannot identify any factor likely to reverse the cycle. Looking at historical economic data for
Apart from a technical lift on the last day of the third quarter, markets retreated as a fresh wave of bad political and economic news arrived. Both industrial and services ISM data fell much more than consensus expectations. Manufacturing ISM
Once again, markets danced to the tune of developments in US politics and the trade war. The Democrats started a pre-impeachment procedure against Donald Trump. Washington is still looking for a broad agreement with Beijing, one that goes beyond simply
US-China tensions eased further over the week and Beijing exempted US products from import duties only a few days before both sides were due to meet for talks. China might even resume importing US agricultural products like soya. Meanwhile, over
Equity markets finally rebounded on reduced tensions in Hong Kong, mounting obstacles in Boris Johnson’s way towards a no-deal Brexit and news that US-China talks were to resume. Economic data remained mixed between upbeat consumer services and fears of an
Political declarations took centre stage this week, starting with the usual twists and turns on the trade war front. Following a tit-for-tat escalation in customs tariffs, the mood turned more conciliatory and talks will now probably resume. However, Donald Trump’s
So far this year, equity markets generally posted the sort of returns that would normally be unthinkable amid an earnings slowdown, an increasingly fragile economic cycle and a political environment that has become so risky that global corporate confidence levels
The US Commerce Department’s lift to markets at the beginning of the week soon fizzled out. Half of previously tariff-free Chinese imports will now be spared the proposed duties up to December 15. This concerns $150bn vs. a total of
Markets struggled to regain their calm although the risk of Chinese currency manipulation abated. Fundamental worries over an economic slowdown -with its litany of negative interest rates and yield curve inversion – returned to haunt investors. Second quarter results were
The Fed and the ECB have managed to firmly establish lower interest rates while pushing risk assets higher. Investors are sceptical amid high political and economic uncertainty but, at least for the time being, the central bank actions have helped
Central banks once again remained centre stage. Judging from falls in the euro and European sovereign bond yields, investors were clearly expecting big developments over the week. And yet the ECB meeting raised more questions than answers. True, the ECB
Unconvincing results and fresh US-China tensions leave investors hesitant. The US economy remained buoyant thanks to strong consumer spending. Retail sales were underpinned by a 4% lift to wages and falling oil prices (as tensions with Iran abated and fears
Market flash Meanwhile, the European Union made a number of senior appointments. After lengthy negotiations, a reflection of Europe’s very politically diverse nature, Ursula von der Leyen was put forward as European Commission president while Christine Lagarde was proposed as
Market Flash The week kicked off with an increasing amount of disappointing economic data, particularly in China, prolonging concerns over growth and driving investors’ risk aversion sharply higher. Speaking at a conference in Chicago, J. Powell confirmed comments from several
Trade war uncertainties continued while the latest advanced indicators delivered increasingly contradictory signals. Conference Board indicators on consumer confidence rebounded in May amid very buoyant labour market conditions. Note, however, that the survey was up to May 16 and therefore
Market Flash The US trade dispute continued to worry markets and US and German companies. At the end of the period, US PMI data remained in positive territory but showed confidence levels slipping. The Fed stayed in wait-and-see mode as
Market Flash In a week full of twists and turns, US-China trade talks turned complicated. Donald Trump is now expected to postpone the introduction of tariffs on European car and spare part imports to the US. This coincided with a
Market Flash Volatility rebounded from lows after Donald Trump threatened to raise tariffs on certain Chinese imports from 10% to 25% from Friday May 10 if trade talks failed make substantial progress. He followed through on this threat even though
Market Flash A shortened week got off to a positive start with S&P maintaining Italy at BBB with a negative outlook. Spain's elections saw the Socialist party come out on top with more seats than previously but still no absolute
There were no clear indications on market trends this week, a reflection of the difficulty investors are having in distinguishing between good and bad macro and company news. – Germany’s industrial PMI and IFO index remained weak, leading Berlin to
The Earnings Season Kicks Off US markets pushed inexorably towards all-time highs, leaving the S&P500 only 40 points off its September 2018 peak. However, trading was still thin, especially for the beginning of the quarterly earnings season. First quarter earnings
The Earnings Season Kicks Off US markets pushed inexorably towards all-time highs, leaving the S&P500 only 40 points off its September 2018 peak. However, trading was still thin, especially for the beginning of the quarterly earnings season. First quarter earnings
Market flash The headline event in Europe was Brexit being postponed to October 31 at the latest. The agreement will prolong uncertainty but at least there is no short-term risk of a no-deal exit. The April 10 ECB meeting left
Asset Allocation Strategy Equity and bond markets have staged an impressive rebound since January; what is equally impressive is that this has been accomplished with practically no shift in fundamentals and fund flows. The fourth-quarter sell-off was caused by central
