Doves roost with the Hawks + Oil at recent lows
MARKETS US equities slipped Wednesday after a solid beat on US retail, which turned the focus to the possibility of a more aggressive Fed reaction. And Fedspeak continued with hawkish comments and also weighed on sentiment. In a not-so-gentle reminder that while the Fed is likely to downshift, they are far from done, San Francisco Fed…
Fed speakers cause a late session drop
US equities suffered a late session drop on Monday as Fed speakers remained in focus ahead of a relatively light economic week. Fed Governor Christophe Waller was characteristically hawkish in his comments, while Vice Chair Lael Brainard speaking in Washington, also stressed that much additional work is left to be done still. With US growth…
The Beat Goes On ( Stocks +Forex) But Not For Oil
Markets A lower-than-expected US inflation print and a softening of Covid policy in China continue to lead risk assets. China remained a hot topic with support for the property market via 16 measures and an RMB250 bn bond sale program support reaffirming the view that property sales and starts should stabilize in the next few…
Weekend Headlines Suggest It Is Still To Early to Fade
MARKETS After sifting through the weekend headline reels, editorials focused primarily on easing China and COVID restrictions. That postive news came hot on the heels of the US CPI on Thursday and gave risk assets a further boost. Commodities had a solid end to the week, with almost everything from oil and copper to soybeans…
Investors are dancing in the streets
MARKETS Stocks surged in a rising tide lifts-all-boats scenario as slower-than-projected inflation galvanized bets the Federal Reserve can downshift its aggressive rate-hike path. To say markets reacted positively to the report would be an understatement, as the enraptured price action suggests investors interpreted the softer inflation print as a significant turning point, particularly in inflation,…
No red tsunami but another crypto flash flood
MARKETS Stocks wobbled after the “red tsunami” investors backed failed to materialize. Then the S&P 500 made new lows on the flash flood effects when Binance scuppered its deal to buy rival FTX triggering a flurry of bitcoin selling below $16,000, decimating long-positioned investors. You can’t deny the growing correlation between bitcoin and risk assets….
A New Phase for Markets? USD weaker and Gold Shines Again
MARKETS As 2022 draws to a close, the markets seem poised to head into a new phase. But it’s all about the mid-term elections in the US now. It is becoming apparent equity markets are riding on the possibility of a divided government. At face value, this would seem counterintuitive to non-market folks, but for…
A divided government in Washington is ostensibly bullish for equities
MARKETS US equities began the week bouncing back, with the S&P 500 convincingly up ahead of the US mid-term elections on Tuesday US time, where a divided government in Washington is ostensibly bullish for equities. Well, at least that’s the conventional wisdom, and the rationale is pretty straightforward. Gridlock cross-checks each party’s “worst impulses,” and less…
YUAN Watch +Oil Potential China reopening
A People’s Daily report and social media posts point to a potential China reopening. And have sent USDCNH lower and CGB yields and FX swaps turn higher this morning as investors chase that flickering light at the end of the Covid zero tunnel. Oil prices are getting a bounce on the news as traders ultimately…
Renewed Recessionary Headwinds Hurt Stocks
MARKETS Markets are still feeling the after-effects from Chair Powell forcefully pushing back the ‘pivot’ narrative.US equity markets continued to sell off for the second day on the November FOMC meeting follow-through, as renewed recession concerns kept growth under pressure. Indeed, the Fed’s willingness to take rates higher for longer inevitably raises the probability of…
