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Economy

A Paradigm Shift In Chinese Economic Policy

There has been a paradigm shift in Beijing’s approach to policy stimulus. The main purpose of government policy is now managing downside risks to the economy in both the short and long term. The priority for the central government is to build an economic and financial system resilient against potential negative shocks, including external threats.

China Investment Strategy, Emerging Markets Strategy by Arthur Budaghyan
Chinese Export Contraction Extends Into 2023
Chinese trade data remained weak in the first two months of the year. Exports in USD terms contracted by 6.8% y/y while imports dropped by 10.2% y/y. Declining exports reflect poor global demand for Chinese products as goods consumption normalizes across…
Daily Insights
The RBA Is Nearing The End
As expected, the Reserve Bank of Australia raised its Cash Rate by 25 basis points to 3.60%, delivering a 10th consecutive rate hike. However, the central bank’s dovish signal about the monetary policy outlook led to a decline in Aussie government bond yields…
Daily Insights
The Fed Is Data Dependent
The US Treasury curve bear flattened sharply in response to Fed Chair Jay Powell’s testimony before the Senate banking committee on Tuesday. The 2-year yield’s 12 basis point jump and upward revision to futures markets’ expectations of the peak fed funds rate…
Daily Insights
Earnings Growth Expectation For Q1-23 And Beyond
Lower earnings expectations: Analyst earnings growth expectations have moderated since the summer, downshifting from a sugar-high 10% in July to the most recent target of 2% for the next twelve months.  This is a positive for equities as it indicates…
Daily Insights
Sector Chart Pack: What Is Cheap?

The equity market is back to the 2019 level on an inflation-adjusted basis. However, it is still not cheap as it is not pricing in the possibility of a prolonged and deep earnings recession or a higher interest rates regime. Many areas of the market that appear cheap, are cheap for a reason. The only industries that are cheap because they are growing into their valuations are Energy and Airlines. We are upgrading Airlines to equal weight.

US Equity Strategy by Irene Tunkel
The Beginning Of A Relapse In European Soft-Data?
The March Sentix Economic Index sent a cautionary signal about investor morale. The overall index for the Eurozone declined from -8.0 to -11.1 – marking the first monthly decrease since the index bottomed at -38.3 in October and missing expectations of a…
Daily Insights
China's Growth Target Disappoints
China’s legislative session, which formally opened on March 5, should be seen as a tentative disappointment for global risk assets and cyclical markets and sectors. While China is reopening from strict Covid-19 restrictions, which is positive for domestic…
Daily Insights
February Survey Results: A Shift In Policy Expectations
In the monthly Daily Insights Survey we conducted last week, we asked about our readers’ expectations for Fed policy, regional equity allocation, and the tactical outlook for the S&P 500. The majority of respondents (70%) expect the Fed to end the…
Daily Insights
US Savings Rate Rises And Falls With Income Growth
According to BCA Research’s US Investment Strategy service excess pandemic savings are far more evenly spread than most investors realize, and all but the households at the bottom of the distribution are swimming in cash. The team has used the savings rate…
Daily Insights

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