Mercados Financieros
Aspectos destacados
El mundo sigue inmerso en una recesión manufacturera.
Por lo tanto, aún es demasiado pronto para iniciar nuevas operaciones pro-cíclicas.
Enfóquese en los cruces en lugar de apuestas directas contra el dólar estadounidense.
Dos nuevas ideas de operación: vender EUR/NOK y comprar GBP/JPY. También considere vender la relación oro/plata.
Destacado
Los mercados de divisas tienden a entrar y salir de varios regímenes. Esto significa que, para ser un gestor de FX eficaz, debe ser extremadamente flexible. Por ejemplo, los diferenciales de tasas de interés pueden dominar los movimientos de FX durante un período determinado, pivotando su trabajo hacia la monitorización de los bancos centrales. Otras veces, los flujos dominan, quizás incluso los flujos de acciones, como cuando se desarrolla una tecnología disruptiva en un mercado específico. La sobresaliente actuación de las acciones estadounidenses, concretamente las de tecnología, es un buen ejemplo. Las dinámicas de balanza de pagos suelen importar sobre todo en puntos de inflexión críticos, por lo que no son muy útiles como indicadores de timing. El privilegio exorbitante del dólar estadounidense que discutimos hace dos semanas también es un ejemplo. Pero, más a menudo que no, ser capaz de identificar si el clima de inversión está a punto de volverse más hostil o no podría ser la diferencia clave entre ser un gestor de FX exitoso o un fósil.
No han faltado noticias para que los inversores las digieran en los últimos días, desde el lío del Brexit, hasta la Fed, los ataques con drones en Arabia Saudita y, finalmente, el posible impeachment del presidente de EE. UU., Donald Trump. Pero lo más desconcertante (y quizás lo más importante) ha sido la lectura flash del PMI manufacturero alemán para el mes de septiembre de 41.4, la más baja en más de una década (Gráfico I-1). Si el país con la “moneda más barata” no puede salir de una recesión manufacturera, entonces el mensaje para la periferia es claramente que tienen un problema inminente. En resumen, nuestra afirmación de que el euro estaba cerca de un mínimo podría estar fuera de juego por unos meses, con base en la última publicación de datos manufactureros (Gráfico I-2).
Gráfico I-1
Una recesión manufacturera en la zona euro
Una recesión manufacturera en la zona euro
Una recesión manufacturera en la zona euro
Gráfico I-2
El euro necesita un crecimiento más fuerte
El euro necesita un crecimiento más fuerte
El euro necesita un crecimiento más fuerte
¿Qué régimen de divisas?
Gráfico I-3
Una recesión será alcista para el dólar
Algunas ideas de trading
Algunas ideas de trading
El comportamiento del dólar desde la inversión de la curva de rendimientos el 2/10 es instructivo. Hasta ahora, estamos siguiendo tanto las hojas de ruta de 2005 como de 1998, lo que significa que la ventana para un optimismo cauteloso sobre los activos de riesgo aún podría materializarse (Gráfico I-3). Específicamente, el dólar tiende a apreciarse durante las recesiones, pero la ventana antes de que la tendencia alcista del dólar se afiance puede ser bastante larga. En 2006 y 1998, el dólar finalmente se catapultó al alza, pero tardó más de 12 meses. Por lo tanto, disponer de un modelo de probabilidad de recesión y su timing preciso es crucial para la estrategia.
Históricamente, los flujos domésticos han sido un indicador muy puntual, ya que la repatriación por parte de residentes ocurre durante episodios de fuga masiva de capitales. En 2005, los individuos domésticos estaban desplegando fondos fuera de EE. UU., lo que sugería paciencia antes de posicionarse por la fortaleza del dólar. Esto tenía sentido, ya que el retorno del capital era mayor fuera de EE. UU. con el auge de los mercados emergentes y de las materias primas en pleno apogeo. La mayoría de las veces, los mercados de FX tienden a favorecer las regiones con el mayor retorno sobre el capital. Estas tienden a ser las más difíciles de apostar en contra, pero potencialmente el mayor factor sorpresa en los puntos de inflexión.
Si los datos económicos continúan deteriorándose debido a factores endógenos mucho mayores, claramente está justificada una estrategia defensiva. Una forma de saberlo será una divergencia emergente entre nuestros indicadores líderes y los datos subyacentes reales, como está ocurriendo hasta ahora en septiembre. Por otro lado, cualquier espectro de noticias positivas podría avivar sectores, monedas y países que han soportado el peso de la desaceleración. Ambos son apuestas altamente arriesgadas. Por ahora, preferimos centrarnos en los cruces en lugar de apuestas directas contra el dólar estadounidense.
Vender EUR/NOK
A veces, las mejores ideas son las más sencillas. El Norges Bank es el banco central más hawkish del G-10, mientras que el Banco Central Europeo reinició el QE en su última reunión. Esto es un catalizador poderoso para una operación corta en EUR/NOK:
El dólar tiende a apreciarse durante las recesiones, pero la ventana antes de que la tendencia alcista del dólar se afiance puede ser bastante larga.
La desaceleración en la zona del euro se ha concentrado en el sector manufacturero, pero el impulso deflacionario está empezando a trasladarse a otras partes de la economía. El IPC subyacente general de la zona del euro sigue cayendo, lo que históricamente ha sido un mal presagio para el euro (Gráfico I-4). Esperamos que las expectativas de inflación de la zona euro eventualmente aumenten, en parte ayudadas por la recuperación de los precios del petróleo (Gráfico I-5), pero esto también beneficiará a la corona noruega.
EUR/NOK ha seguido históricamente el desempeño relativo de los precios de las acciones entre Europa y Noruega, pero se abrió una brecha enorme en 2018 (Gráfico I-6). Esta divergencia es insostenible. En resumen, es una apuesta sobre los campos petrolíferos en Noruega frente a los bancos europeos.
La aplicación de tramos en las reservas por parte del BCE podría impedir que los bancos de la zona del euro coqueteen con el abismo, pero a menos que la recesión manufacturera termine pronto y las empresas empiecen a pedir prestado para invertir, los bancos seguirán teniendo un problema de demanda. Mientras tanto, el estallido de tensión en Oriente Medio significa que los precios del petróleo se mantendrán al alza en el corto plazo. Esto debería favorecer a las acciones noruegas sobre las de la zona del euro, y ser negativo para EUR/NOK (Gráfico I-7).
Los bunds alemanes a 10 años rinden -0.57%, mientras que el diferencial de rendimiento con los bonos noruegos ofrece un carry positivo de 1.8%, a pesar de las preocupaciones por la liquidez. En su última reunión de política, el gobernador del banco central Øystein Olsen destacó que Noruega tenía mucho más margen fiscal para maniobrar en caso de una desaceleración, lo que significa que la oferta de deuda noruega podría aumentar, aliviando la prima de liquidez.
Gráfico I-4
La deflación sigue predominando en la zona euro
La deflación sigue predominando en la zona euro
La deflación sigue predominando en la zona euro
Gráfico I-5
Un aumento de los precios del petróleo ayudará a las expectativas de inflación
Un aumento en los precios del petróleo contribuirá a elevar las expectativas de inflación.
Un aumento en los precios del petróleo contribuirá a elevar las expectativas de inflación.
Gráfico I-6
Acciones y divisas: una divergencia insostenible
Acciones y divisas: una divergencia insostenible
Acciones y divisas: una divergencia insostenible
Gráfico I-7
Un petróleo más alto es negativo ##br##para EUR/NOK
Un aumento del precio del petróleo es negativo para EUR/NOK
Un aumento del precio del petróleo es negativo para EUR/NOK
Conclusión: Vender EUR/NOK en 9.937.
Comprar GBP/JPY
El Informe especial de la semana pasada defendió una recuperación cíclica en el Reino Unido, aunque los factores estructurales siguen siendo un viento en contra. Esta semana, volvemos a intentar comprar cable frente al yen:
Lo más importante es que el Banco de Inglaterra se mantuvo inmóvil en su última reunión de política, mientras que el Banco de Japón probablemente introducirá más estímulos o una orientación más contundente.
Los diferenciales de tasas de interés reales favorecen una libra más fuerte. Lo más importante es que el Banco de Inglaterra se mantuvo inmóvil en su última reunión de política, mientras que el Banco de Japón probablemente introducirá más estímulos o una orientación más contundente (Gráfico I-8).
Gráfico i-8
Es probable un rebote táctico en GBP/JPY
Es probable un rebote táctico en el par GBP/JPY
Es probable un rebote táctico en el par GBP/JPY
Gráfico I-9
El beneficio de una libra más débil
El Beneficio De Una Libra Más Débil
El Beneficio De Una Libra Más Débil
Los especuladores están muy cortos con la libra, mientras que han estado cubriendo sus apuestas cortas en el yen, a medida que el entorno de inversión se ha vuelto más incierto.
La caída de la libra debería comenzar a mejorar la dinámica de balanza de pagos del Reino Unido en relación con Japón (Gráfico I-9).
Conclusión: Comprar GBP/JPY en 132.6.
Pensamientos finales
Seguimos monitorizando varios indicadores para el dólar, desde diferenciales de tasas de interés, dinámicas de balanza de pagos, valoraciones, flujos de cartera y posicionamiento, y ninguno de ellos está enviando una señal alcista en este momento. El crecimiento global sigue estancado, lo que ha potenciado a los alcistas del dólar. Sin embargo, las apuestas largas por el dólar siguen siendo vulnerables si el crecimiento global se estabiliza. Nuestra estrategia es continuar centrándonos en los cruces hasta que emerja evidencia categórica de que el crecimiento global ha tocado fondo.
En nuestra cartera de trading, seguimos favoreciendo la NOK, SEK, las petromonedas y el AUD. Hasta ahora, estas operaciones se han ejecutado en los cruces para limitar el riesgo a la baja, en caso de que nuestra visión sobre el dólar estuviera fuera de lugar. Tenemos la intención de empezar a realizar apuestas directas en dólares una vez que emerja evidencia de que el crecimiento global ha tocado fondo y el mundo ha evitado una recesión.
Chester Ntonifor, Estratega de Divisas chestern@bcaresearch.com
Divisas
Dólar estadounidense
Gráfico II-1
Técnicas del USD 1
Análisis técnicos USD 1
Análisis técnicos USD 1
Gráfico II-2
Técnicas del USD 2
Indicadores técnicos USD 2
Indicadores técnicos USD 2
Los datos recientes en EE. UU. han sido relativamente sólidos:
El PMI manufacturero flash de Markit se recuperó a 51 en septiembre desde 50.3. El PMI de servicios flash aumentó a 50.9.
El índice de actividad nacional del Chicago Fed aumentó a 0.1 desde -0.4 en agosto.
El índice manufacturero del Richmond Fed cayó a -9 en septiembre desde 1.
La confianza del consumidor del Conference Board cayó a 125.1 en septiembre desde 135.1.
En el frente inmobiliario, los precios de la vivienda crecieron 0.4% mes a mes en julio. Las solicitudes de hipoteca disminuyeron 10% en la semana terminada el 20 de septiembre, pero las ventas de viviendas nuevas aumentaron 7% mes a mes en agosto.
Las solicitudes iniciales de subsidio por desempleo aumentaron a 213,000 para la semana terminada el 20 de septiembre.
El crecimiento del PIB anualizado se mantuvo sin cambios en 2% trimestre a trimestre en el segundo trimestre.
El déficit comercial de bienes se mantuvo prácticamente sin cambios en $72.8 mil millones.
El PCE interanual y subyacente aumentaron a 2.4% y 1.9% trimestre a trimestre, respectivamente, en el segundo trimestre.
El índice DXY se apreció 0.6% esta semana. Los datos recientes de EE. UU. se han mantenido bastante bien en comparación con el resto del mundo. Las posiciones especulativas netas en el billete verde siguen elevadas debido a la relativa fortaleza de EE. UU. Si bien vemos resiliencia del dólar en el corto plazo, la disminución de las compras netas extranjeras de valores estadounidenses, el acortamiento de los diferenciales de tasas de interés y la caída de la relación bono/oro sugieren que la senda de menor resistencia para el dólar es a la baja.
Enlaces de informes:
Preservando capital durante puntos de motín - 6 de septiembre de 2019
¿Ha cambiado el panorama de las divisas? - 16 de agosto de 2019
USD/CNY y turbulencia del mercado - 9 de agosto de 2019
El euro
Gráfico II-3
Técnicas del EUR 1
Aspectos técnicos del EUR 1
Aspectos técnicos del EUR 1
Gráfico II-4
Técnicas del EUR 2
EUR Técnicos 2
EUR Técnicos 2
Los datos recientes en la zona del euro continúan deteriorándose:
Los PMIs flash de fabricación y servicios de Markit para la zona del euro cayeron a 45.6 y 52, respectivamente, en septiembre.
En Francia, el PMI manufacturero flash de Markit cayó a 50.3; el PMI de servicios disminuyó a 51.6. En Alemania, el PMI manufacturero se desplomó a 41.4; el PMI de servicios cayó a 52.5.
La valoración actual del IFO alemán aumentó a 98.5 en septiembre. Sin embargo, las expectativas del IFO cayeron a 90.8.
La oferta monetaria (M3) creció 5.7% interanual en agosto.
La confianza del consumidor alemán Gfk aumentó a 9.9 en octubre.
El EUR/USD cayó 0.8% esta semana. Los datos recientes de la zona del euro, desgraciadamente, no han mostrado señales de que el crecimiento global esté tocando fondo. El PMI manufacturero en Alemania está ahora en su nivel más bajo desde la Gran Crisis Financiera. Una preocupación importante para los inversores es que la débil actividad en manufactura puede ya haber comenzado a infiltrarse en los sectores de servicios. Dicho esto, los PMIs de servicios en las principales economías, aunque en descenso, todavía se mantienen en territorio expansivo por encima de 50.
Enlaces de informes:
Batalla de los bancos centrales - 21 de junio de 2019
EUR/USD y la tasa de interés neutral - 14 de junio de 2019
Tomar algo de seguro - 3 de mayo de 2019
Yen japonés
Gráfico II-5
Técnicas del JPY 1
Análisis técnico del JPY 1
Análisis técnico del JPY 1
Gráfico II-6
Técnicas del JPY 2
Indicadores técnicos del JPY 2
Indicadores técnicos del JPY 2
Los datos recientes en Japón han sido negativos:
La inflación general nacional cayó de 0.5% interanual a 0.3% interanual en agosto. La inflación subyacente se mantuvo sin cambios en 0.6% interanual.
El PMI manufacturero flash de Markit cayó a 48.9 en septiembre desde 49.3. El PMI de servicios también cayó a 52.8 desde 53.3.
El índice líder y el índice coincidente se mantuvieron prácticamente sin cambios en 93.7 y 99.7, respectivamente, en julio.
El USD/JPY se ha mantenido plano esta semana. Las exportaciones japonesas han sido débiles, lastradas por la guerra comercial global y la desaceleración manufacturera. Sin embargo, según el BoJ, la demanda interna se ha mantenido firme y la inversión en capital fijo continúa aumentando. Además, el aumento del impuesto al consumo el próximo mes probablemente tendrá un impacto marginal comparado con aumentos de impuestos anteriores. En un discurso esta semana, el gobernador del BoJ, Haruhiko Kuroda, enfatizó que el banco central aflojará sin dudar si la economía pierde impulso.
Enlaces de informes:
¿Ha cambiado el panorama de las divisas? - 16 de agosto de 2019
Ajustes de cartera en un verano de negociación delgado - 5 de julio de 2019
Batalla de los bancos centrales - 21 de junio de 2019
Libra esterlina
Gráfico II-7
Técnicas del GBP 1
Análisis técnico GBP 1
Análisis técnico GBP 1
Gráfico II-8
Técnicas del GBP 2
Análisis técnicos de GBP 2
Análisis técnicos de GBP 2
Hay pocos datos del Reino Unido esta semana:
Las aprobaciones hipotecarias disminuyeron ligeramente a 42,576 en agosto desde 43,303 en julio.
El GBP/USD cayó 1.4% esta semana. El primer ministro británico Boris Johnson ha perdido ahora su mayoría en Westminster tras importantes deserciones de los llamados rebeldes, por lo que otra elección es muy probable antes de fin de año. Además, un nuevo aplazamiento del Brexit es casi seguro. Hemos rebajado la probabilidad de un Brexit sin acuerdo. Mantenemos una visión positiva sobre la libra y esta semana estamos comprando GBP/JPY.
Enlaces de informes:
Reino Unido: ¿Desaceleración cíclica o malestar estructural? - 20 de septiembre de 2019
Batalla de los bancos centrales - 21 de junio de 2019
Una visión contraria sobre el dólar australiano - 24 de mayo de 2019
Dólar australiano
Gráfico II-9
Técnicas del AUD 1
Análisis técnicos de AUD 1
Análisis técnicos de AUD 1
Gráfico II-10
Técnicas del AUD 2
Análisis técnicos del AUD 2
Análisis técnicos del AUD 2
Los datos recientes en Australia han sido mixtos:
El PMI manufacturero preliminar commonwealth cayó a 49.4 en septiembre desde 50.9 en agosto. Por otro lado, el PMI de servicios se recuperó a 52.5 desde 49.1, volviendo a territorio expansivo por encima de 50.
La confianza del consumidor aumentó a 110.1 desde 109.3 esta semana.
El AUD/USD cayó 1% esta semana. El gobernador del Reserve Bank of Australia, Philip Lowe, comentó el martes que la economía australiana se está recuperando y se encuentra ahora en un “punto de inflexión suave”. Los recortes de tasas previos han permitido que los mercados inmobiliarios de ciudades grandes como Sídney y Melbourne recuperen cierta fuerza, pero probablemente tardarán más en transmitirse a toda la economía. En términos de política monetaria, el gobernador Lowe reiteró su compromiso de aflojar las condiciones monetarias cuando sea necesario, aunque no indicó un movimiento inminente para la próxima semana. Australia tiene una gran beta a los cambios globales como una economía pequeña y abierta. Si la recesión manufacturera global llega a su fin, los fundamentos positivos seguirán impulsando la economía australiana durante el resto del año y en 2020.
Enlaces de informes:
Una visión contraria sobre el dólar australiano - 24 de mayo de 2019
Cuidado con los rendimientos marginales decrecientes - 19 de abril de 2019
Aún no fuera de peligro - 5 de abril de 2019
Dólar neozelandés
Gráfico II-11
Técnicas del NZD 1
Análisis técnico NZD 1
Análisis técnico NZD 1
Gráfico II-12
Técnicas del NZD 2
Análisis técnico del NZD 2
Análisis técnico del NZD 2
Los datos recientes en Nueva Zelanda han sido negativos:
Las importaciones aumentaron NZ$30 millones hasta NZ$5.69 mil millones en agosto, mientras que las exportaciones cayeron NZ$830 millones hasta NZ$4.13 mil millones. El déficit comercial total se amplió de NZ$700 millones a NZ$1.57 mil millones.
El NZD/USD se apreció 1% inicialmente, luego cayó tras la reunión de política del Reserve Bank of New Zealand, quedando plano esta semana. Como ampliamente se esperaba, el RBNZ mantuvo su tasa oficial de efectivo sin cambios en 1% este miércoles mientras señalaba que hay más margen para aliviar la política si es necesario en medio de una desaceleración global. El mercado actualmente está valorando una probabilidad del 80% de un recorte de tasas para la próxima reunión de política en noviembre, reflejando la débil confianza empresarial. Estamos jugando la debilidad del kiwi a través del dólar australiano y la corona sueca, que están 1.9% y 1.95% en el dinero, respectivamente.
Enlaces de informes:
USD/CNY y turbulencia del mercado - 9 de agosto de 2019
¿Hacia dónde va el dólar estadounidense? - 7 de junio de 2019
Aún no fuera de peligro - 5 de abril de 2019
Dólar canadiense
Gráfico II-13
Técnicas del CAD 1
Técnicas de CAD 1
Técnicas de CAD 1
Gráfico II-14
Técnicas del CAD 2
Técnicas CAD 2
Técnicas CAD 2
Los datos recientes en Canadá han sido resilientes:
La confianza Bloomberg Nanos aumentó a 57.4 esta semana desde 56.7.
Las ventas minoristas aumentaron 0.4% mes a mes en julio, por debajo de las expectativas de un crecimiento mensual de 0.6%.
El USD/CAD se ha mantenido plano esta semana. Los precios del petróleo han vivido una montaña rusa este año. Desde el ataque con drones hace dos semanas, Arabia Saudita ha afirmado que se está recuperando más rápido de lo esperado, superando sus propias metas. Los precios spot del crudo Brent han caído 6% desde su pico del 16 de septiembre, mientras que los precios del Western Canada Select (WCS) han bajado 12.3%, lo que atenúa el potencial alcista del loonie.
Enlaces de informes:
Preservando capital durante puntos de motín - 6 de septiembre de 2019
Ajustes de cartera en un verano de negociación delgado - 5 de julio de 2019
Sobre el oro, el petróleo y las criptomonedas - 28 de junio de 2019
Franco suizo
Gráfico II-15
Técnicas del CHF 1
Análisis técnicos del CHF 1
Análisis técnicos del CHF 1
Gráfico II-16
Técnicas del CHF 2
Indicadores técnicos del CHF 2
Indicadores técnicos del CHF 2
Los datos recientes en Suiza han sido mayormente negativos:
La balanza comercial se redujo a CHF 1.2 mil millones en agosto desde CHF 2.6 mil millones en julio.
Las expectativas de la encuesta de Credit Suisse se situaron en -15.4 en septiembre, frente a la lectura anterior de -37.5 en agosto.
El USD/CHF se ha mantenido plano esta semana. Como economía pequeña y abierta, Suiza pertenece a los países con la mayor proporción comercio exterior/PIB. La balanza comercial en agosto ha sido la más baja desde enero de 2018, con menores exportaciones de bienes principales, incluidos productos químicos y farmacéuticos. Entre los socios comerciales, las exportaciones a Alemania, Italia y Francia disminuyeron, reflejando la reciente desaceleración manufacturera en Europa. Dicho esto, seguimos siendo positivos sobre el franco suizo como refugio durante periodos de riesgo a la baja en medio de las incertidumbres de la guerra comercial, el caos del Brexit, las tensiones en Oriente Medio y, más recientemente, el lío del impeachment de Trump.
Enlaces de informes:
¿Qué hacer con el franco suizo? - 17 de mayo de 2019
Cuidado con los rendimientos marginales decrecientes - 19 de abril de 2019
Balanza de pagos en el G10 - 15 de febrero de 2019
Corona noruega
Gráfico II-17
Técnicas del NOK 1
NOK Análisis técnico 1
NOK Análisis técnico 1
Gráfico II-18
Técnicas del NOK 2
NOK Técnicos 2
NOK Técnicos 2
Hay escasos datos de Noruega esta semana:
La tasa de desempleo aumentó a 3.8% en julio, 0.6 puntos porcentuales más que en abril, según la reciente Encuesta de Fuerza Laboral.
El USD/NOK se apreció 0.5% esta semana. El Norges Bank, el único banco central hawkish entre el G-10, subió su tasa de interés en 25 puntos básicos hasta 1.5% la semana pasada. Desde septiembre pasado, el Norges Bank ha subido las tasas cuatro veces en total, resultando en un aumento de un punto porcentual en las tasas. El banco central declaró que “la economía noruega ha sido sólida; el empleo ha aumentado; la utilización de la capacidad parece estar algo por encima de un nivel normal; la inflación está cerca del objetivo.” Una tasa de interés más alta también ayudaría a frenar la subida vertiginosa de los precios de la vivienda y los niveles de deuda de los hogares. Además, el banco central rebajó su trayectoria proyectada para la corona, indicando que los factores que describió, incluida la actividad más débil en el sector petrolero, probablemente seguirían lastrando a la corona en los próximos años.
Enlaces de informes:
Ajustes de cartera en un verano de negociación delgado - 5 de julio de 2019
Sobre el oro, el petróleo y las criptomonedas - 28 de junio de 2019
Complacencia cambiaria en medio de un giro global hacia el dovish - 26 de abril de 2019
Corona sueca
Gráfico II-19
Técnicas del SEK 1
Análisis técnico del SEK 1
Análisis técnico del SEK 1
Gráfico II-20
Técnicas del SEK 2
SEK Técnicos 2
SEK Técnicos 2
Los datos recientes en Suecia han sido negativos:
La confianza del consumidor cayó a 90.6 en septiembre.
El crecimiento anual del IPP cayó de 2% en julio a 1.4% en agosto.
La balanza comercial cambió a un déficit de SEK 5.4 mil millones en agosto.
USD/SEK se ha mantenido plano esta semana. Estamos monitorizando de cerca el comercio exterior sueco como un indicador líder del crecimiento global. La balanza comercial sueca ha pasado a déficit por primera vez este año. Sin embargo, en comparación con agosto pasado, el déficit se redujo en SEK 2.6 mil millones. En lo que va de año, el superávit comercial sueco ascendió a SEK 27 mil millones. Cabe destacar que el comercio de bienes con países no pertenecientes a la UE resultó en un superávit de SEK 6.6 mil millones, mientras que el comercio con la UE resultó en un déficit de SEK 12 mil millones.
Enlaces de informes:
¿Hacia dónde va el dólar estadounidense? - 7 de junio de 2019
Balanza de pagos en el G10 - 15 de febrero de 2019
Una clasificación simple de atractivo para las divisas - 8 de febrero de 2019
Operaciones y previsiones
Resumen de previsiones
Cartera central
Operaciones tácticas
Órdenes límite
Operaciones cerradas
Please note that this abbreviated weekly report complements today’s Special Report titled China’s Foreign Debt, And A Secret Weapon published in collaboration with BCA’s China Investment Strategy service. Feature A major rotation has commenced in recent days in global financial markets: beaten-down value companies have begun outperforming richly-priced U.S. growth stocks. This has cogently coincided with the rise in U.S. bond yields. Further, U.S. small caps have also begun outpacing U.S. large caps. Do these signals mean that EM will start outperforming DM in general and U.S. in particular? We do not think it is likely to occur on a sustainable basis. We agree that certain trends in global financial markets have become over-extended and a mean-reversion is overdue. U.S. bond yields have probably dropped much more than justified by U.S. economic strength. Although U.S. manufacturing, exports and capex have been extremely week/contracting, consumer spending is expanding at a decent clip. We believe fears of a full-blown U.S. recession are presently exaggerated. It is also critical to gauge what is the underlying cause of this financial market rotation. Is it receding fears of U.S. recession or China’s recovery or both? We believe that the rotation is caused by unwinding of recessionary fears in the U.S., not a revival in the Chinese economy or a recovery in global trade and manufacturing. Unwinding U.S. recessionary fears will not be sufficient to produce a strong and lasting rally in EM risk assets and currencies even if it leads to a breakout in DM share prices in absolute terms. EM risk assets and currencies are much more sensitive to China and global growth rather than to the U.S. economy. Watch The Dollar For Clues Chart I-1EM Relative Equity Performance Correlates With U.S. Dollar Whether the sell-off in global safe-haven bonds and outperformance of global cyclical vs. defensive equity sectors is due to a genuine recovery in China or the U.S. will be revealed in the trend of the U.S. dollar (Chart I-1). If the dollar continues grinding higher, it would entail that the recent financial markets rotation is due to amelioration in U.S. growth expectations and that there is little recovery in the Chinese economy as well as global manufacturing and trade. In this scenario, EM risk assets will underperform. On the contrary, if the greenback begins exhibiting persistent and broad weakness, it would signify that the reversal in global safe-haven bond yields and global cyclical stocks is due to a revival in Chinese demand. In such a case, a lasting recovery in global manufacturing and trade are likely. This would be consistent with a durable EM rally and outperformance. Chart I-2Bullish Technicals For U.S. Dollars So far, the greenback has remained well bid (Chart I-2). In addition, industrial commodities prices remain weak and have failed to rebound (Chart I-3). These entail that the recent spike in U.S. bond yields and outperformance of cyclical equity sectors is primarily due to unwinding of pessimism on U.S. growth rather than a reflection of growth amelioration in China. Notably, cyclical data out of China and global trade/manufacturing remain dismal. Chinese overall imports are contracting (Chart I-4). Chart I-3Breakdown Remains In Play Chart I-4Shrinking Chinese Imports Global semiconductor sales and car purchases continue shrinking at a rapid pace (Chart I-5). China’s credit and money growth and impulses appear to be rolling over, having failed to rise as much as in the previous stimulus episodes (Chart I-6). Finally, the pace of EM corporate EPS contraction is accelerating (Chart I-7). Any rally in EM share prices will be unsustainable without a bottom in EM EPS growth. Chart I-5No Improvement In Global Growth Chart I-6Chinese Credit Impulse Is Weak Chart I-7EM EPS & Share Prices Bottom Line: The U.S. dollar has failed to sell off despite the optimism in global equity markets. This entails that any rebound and outperformance in EM risk assets and currencies will prove to be short-lived. Arthur Budaghyan Chief Emerging Markets Strategist arthurb@bcaresearch.com Equities Recommendations Currencies, Credit And Fixed-Income Recommendations
Highlights Portfolio Strategy The contracting manufacturing sector that rekindled recession fears, the harsh reality of the Sino-American trade war weighing on profits, downbeat business confidence and mushrooming capex slowdown signals all warn that investors should tread carefully in the historically difficult equity market months of September and October. It no longer pays to be overweight gold mining equities as sentiment is stretched, the restarting of global QE will likely reverse or at least halt the drubbing in global yields and the U.S. dollar inverse correlation should reassert itself and weigh on global gold miners. EM and China ills, deflating global producer pricing power, export blues and souring financial statement metrics underscore that materials stocks have ample downside. Recent Changes Trim the Global Gold Mining index to neutral, today. Downgrade the S&P Materials sector to underweight, today. Table 1 Feature Equities broke out of their trading range last week, but in order for this short-covering rally to become durable, and for volatility to subside, either global growth needs to turn the corner and alleviate recession fears or the trade war needs to de-escalate materially. On the recession front Central Banks (CBs) are doing their utmost to reflate their respective economies, but the early stages of looser monetary policy have been insufficient to change the global growth trajectory. With regard to the trade war, markets cheered the news that talks between the U.S. and China will resume in September and October. The dates for talks are conveniently chosen to follow the September FOMC meeting and the October 1 70th anniversary of the People's Republic of China. The latter date implies that Washington is considering delaying the October 1 tariff hike – and it could imply that Washington does not anticipate any violent suppression of Hong Kong protesters by that time. However, the harsh reality is that the two sides are just “kicking the can down the road”. The longer the Sino-American trade war takes to conclude, the more likely it will serve as a catalyst for a repricing of risk significantly lower (top panel, Chart 1). A technical correction may be necessary to force Trump to reduce the trade pressure significantly. Even if the October 1 tariff hike is postponed it will remain a source of uncertainty ahead of the final tariff tranche slated for December 15. The bond market may offer some clues as to the extent that the escalating trade war will eventually get reflected into stocks (bottom panel, Chart 1). The equity transmission mechanism is through the earnings avenue. Simply put, rising trade uncertainty deals a blow to global trade that boosts the U.S. dollar which in turn makes U.S. exports uncompetitive in global markets, deflates the commodity complex and with a lag weighs on SPX earnings. Chart 1Tracking Trade Uncertainty Speaking of the economically hypersensitive manufacturing sector, last week’s ISM release made for grim reading, further fueling recession fears (the New York Fed now pegs the recession probability just shy of 38% by next August). Not only did the overall survey fall below the boom/bust line (middle panel, Chart 2), but also new orders collapsed. In fact, the drubbing in new orders is worrying and it signals that the economy is going to get worse before it gets better (top panel, Chart 2). Tack on the simultaneous rise in inventories, and the sinking new orders-to-inventories ratio (not shown) warns of additional manufacturing ills in the coming months. Importantly, export orders suffered the steepest losses plunging to 43.3. The last three times that this trade-sensitive survey subcomponent was in such a steep freefall were in 1998, 2001 and 2008, when the SPX suffered peak-to-trough losses of 20%, 49% and 57%, respectively. In fact, since the history of the data, ISM manufacturing export orders have never been lower with the exception of the GFC (Chart 3). Such a retrenchment will either mark the bottom for equities or is a harbinger of a steep equity market correction. We side with the latter as the odds of President Trump striking a real trade deal (including tech) with China any time soon are low. Chart 2Like Night Follows Day Similar to the ISM manufacturing/non-manufacturing divergence (bottom panel, Chart 2), business confidence is trailing consumer conference by a wide mark. Historically this flaring chasm has been synonymous with a sizable loss of momentum in the broad equity market (Chart 4). One plausible explanation is that as business animal spirits suffer a setback, CEOs are quick to prune/postpone capex plans and, at the margin, corporations retrench and short-circuit the capex upcycle. Chart 3Export Carnage Chart 4Mind The Gap Circling back to last week’s capex update, national accounts corroborate the financial statement data deceleration, and in some cases contraction, in capital outlays (Chart 5). As a reminder our thesis is that the EPS-to-capex virtuous upcycle is morphing into a vicious down cycle.1 This week, we downgrade a deep cyclical sector by taking profits in a niche subgroup that has served as a reliable portfolio hedge. Crucially, tech investment, that comprises almost 30% of total investment according to national accounts, is decelerating, R&D and other intellectual property investment have also hooked down, non-residential structures are on the verge of contraction, and industrial, transportation and other equipment –that have the largest weight in U.S. capex – are also quickly losing steam (Chart 6). Chart 5Capex Blues Chart 6All Capex Segments… In more detail, Charts 7 & 8 further break down capital outlays in the respective categories and reveal that worrisomely the investment spending slowdown is broad based. Chart 7…Have Rolled Over… Chart 8…Except For One Adding it all up, the contracting manufacturing sector that rekindled recession fears, the harsh reality of the Sino-American trade war weighing on profits, downbeat business confidence and mushrooming capex slowdown signals all warn that investors should tread carefully in the historically difficult equity market months of September and October. As a reminder, this is U.S. Equity Strategy service’s view and it contrasts with BCA’s sanguine equity market house view. This week, we downgrade a deep cyclical sector by taking profits in a niche subgroup that has served as a reliable portfolio hedge. Downgrade Materials To Underweight… Heightened economic and trade policy uncertainty has claimed the S&P materials sector as one of its victims (Chart 9). Given that our Geopolitical Strategy service’s base case remains that there will be no Sino-American trade deal by the U.S. November 2020 election, there is more downside for materials stocks and we are downgrading this niche deep cyclical sector to a below benchmark allocation.2 Beyond the U.S./China trade war inflicted wounds that materials stocks have to nurse, there are four major headwinds that they will also have to contend with in the coming months. Chart 9Trade Uncertainty Sinking Materials First, the emerging markets (EM) in general and China in particular are in a prolonged soft patch that predates the Sino-American trade war. EM stocks and EM currencies are both deflating at an accelerating pace warning that relative share prices will suffer the same fate (Chart 10). Nothing epitomizes the infrastructure spending/capex cycle more than China’s insatiable appetite for commodities and the news on that front remains dire. The Li Keqiang index continues to emit a distress signal and that is negative for materials top line growth (bottom panel, Chart 10). Second, global inflation is in hibernation and select EM producer price inflation growth series are on the verge of contraction or already outright contracting. Chinese raw materials wholesale prices are in the deflation zone and warn that U.S. materials sector profits will underwhelm (Chart 11). Chart 10Bearish EM… Chart 11…And China Backdrops Base metal prices are a real time indicator of the wellness of the S&P materials sector. Currently, base metals are deflating both on the back of a firming U.S. dollar and contracting global manufacturing. Such a commodity price backdrop is dampening prospects for a profit-led materials sector relative share price recovery (top & middle panels, Chart 12). Third, the materials exports outlook is darkening. Apart from the deflating effect the appreciating U.S. dollar has on commodities it also clips basic materials companies’ exports prospects. How? It renders materials related exports uncompetitive in international markets leading to market share losses. Netting it all out, EM and China ills, deflating global producer pricing power, export blues and souring financial statement metrics underscore that materials stocks have ample downside. Chart 12Weak Pricing Power And Declining Exports In addition, the latest ISM export order subcomponent plunged to multi-year lows reflecting trade war pessimism and falling global end-demand. The implication is that the export relief valve is closed for materials equities (bottom panel, Chart 12). Finally, materials sector financial statement metrics are moving in the wrong direction. Net debt-to-EBITDA is rising anew and interest coverage has likely peaked for the cycle at a time when free cash flow generation has ground to a halt (Chart 13). U.S. Equity Strategy’s S&P materials sector profit growth model encapsulates all these moving parts and warns that a severe profit contraction phase looms (Chart 14). Chart 13Financial Statement Red Flags Chart 14Model Says Sell Netting it all out, EM and China ills, deflating global producer pricing power, export blues and souring financial statement metrics underscore that materials stocks have ample downside. Bottom Line: The time is ripe to downgrade the S&P materials sector to underweight. …Via Trimming Gold Miners To Neutral The way we are executing this downgrade in the materials sector to an underweight stance is by trimming the global gold mining index to a benchmark allocation. Our thesis that gold stocks serve as a sound portfolio hedge remains intact and underpinned when: economic and trade policy uncertainty are on the rise (top panel, Chart 15) global CBs start cutting interest rates and in some cases doubling down on negative interest rates currency wars are overheating Nevertheless, what has changed is the price, and we deem that global gold miners that have gone parabolic are in desperate need of a breather. The top panel of Chart 16 shows that gold stocks have rallied 58% since the May 5, 2019 Trump tweet. This outsized four-month relative return is remarkable and likely almost fully reflects a very dovish Fed and melting real U.S. Treasury yields (TIPS yield shown inverted, bottom panel, Chart 15). A much needed pause for breath is required before the next leg of the relative rally resumes, and we opt to move to the sidelines. Chart 15Positive Backdrop… Chart 16…But Reflected In Prices Moreover, on the eve of the ECB’s September meeting, were President Mario Draghi to re-commence QE in the form of sovereign and corporate bond purchases as markets participants expect, counterintuitively a selloff in the bond markets would confirm that QE and its signaling is working (bottom panel, Chart 16). Ergo, this would likely exert upward pressure on global interest rates including the U.S., especially given the one-sided positioning in the respective global risk free assets. The implication is that the shiny metal and global gold miners would suffer a setback as real yields would rise further. As a reminder, gold bullion yields nothing and gold mining equities next to nothing, thus when competing safe haven assets at the margin start yielding higher, investors flee gold and gold miners and flock to risk free assets. Sentiment toward gold and global gold miners is stretched. Gold ETF holdings are at multi-year highs (second panel, Chart 17) and gold net speculative positions are at a level that has marked previous reversals. In addition, bullish consensus on gold is near 72%, a percentage last reached in 2012 (third & bottom panels, Chart 17). Similarly, relative share price momentum is also warning that global gold mining equities are currently extended (bottom panel, Chart 18). Chart 17Extreme… Chart 18…Sentiment Finally, while the bond market’s view of 100bps in Fed cuts in the next 12 months should have undermined the trade-weighted U.S. dollar, it has actually defied gravity and slingshot to fresh cycle highs. This is a net negative both for gold and gold mining equities as the underlying commodity is priced in U.S. dollars and enjoys an inverse correlation with the greenback. The implication is that the multi-decade inverse correlation will hold and will likely pull down gold and gold mining equities at least in the short-run (U.S. dollar shown inverted, Chart 19). In sum, the exponential rise in global gold miners is in need of a breather. Sentiment is stretched, the restating of global QE will likely reverse or at least halt the drubbing in global yields and the U.S. dollar inverse correlation should reassert itself and weigh on relative share prices Chart 19Gold Miners/Dollar Correlation Re-establishment Risk Bottom Line: Downgrade the global gold mining index to neutral, but stay tuned. Anastasios Avgeriou, U.S. Equity Strategist anastasios@bcaresearch.com Footnotes 1 Please see U.S. Equity Strategy Weekly Report, “Capex Blues” dated September 3, 2019, available at uses.bcaresearch.com 2 Please see The Bank Credit Analyst Special Report, “Big Trouble In Greater China” dated August 29 , 2019, available at bca.bcaresearch.com Current Recommendations Current Trades Size And Style Views Stay neutral cyclicals over defensives (downgrade alert) Favor value over growth Favor large over small caps
Highlights The fundamental backdrop continues to be mixed, but last week’s key data releases were encouraging on balance: While the U.S. manufacturing ISM survey entered contraction territory, and European manufacturing PMIs remained moribund, the services surveys were quite strong, and services contribute much more to developed economies’ total output. The U.S. economy should be able to grow at trend for the next six to twelve months: Consumption is underpinned by a robust labor market, federal government spending will not flag ahead of the 2020 elections, and state and local revenues are well supported. Investment is unlikely to sabotage the other two pillars of the U.S. economy. The view that inflation is deader than New York Mayor de Blasio’s presidential ambitions is widespread and entrenched: Participating on a panel at an inflation-themed conference last week, we were struck by the conviction that inflation is going nowhere over the next few years. The risk-reward of taking the other side of that debate may be quite attractive. Feature Another week, another mixed set of data releases. Last Tuesday, the bears’ most cherished fantasies seemed to be within reach as the ISM Manufacturing Index slid below the boom-bust line in a print that fell well short of consensus expectations. The S&P 500, which had probed around August’s 2,945 resistance level in the final pre-Labor Day session, quickly shed more than a percentage point in response. The U.S. data confirmed the message from the previous day’s European manufacturing PMIs: global manufacturing remains in a deep funk, and a turnaround is not yet at hand. It’s hard to get a recession without tight monetary policy, and it’s hard to get a bear market without a recession, ... Wednesday’s European services PMI releases gave the bulls a lift. Though manufacturing activity truly stinks (Chart 1), it shows no signs of contaminating the services sector, which is still expanding at a solid clip (Chart 2). The U.S. ISM Non-Manufacturing Index surged in August, beating consensus expectations by the same two-point margin by which manufacturing fell short. U.S. equities were already trading higher on the back of an imminent resumption of U.S.-China negotiations when the series was released Thursday morning, and the combination helped the S&P 500 decisively break through the level that had held it in check for a month (Chart 3). Chart 1Global Manufacturing ##br##Is Ailing ... Chart 2... But The Service Sector Is Expected To Expand Chart 3Breakout Taking a step back from the consistently mixed data, recessions don’t occur when monetary conditions are easy. Equity bear markets rarely occur outside of recessions, so our default position is to remain at least equal weight equities in a balanced portfolio. We estimate that the equilibrium fed funds rate is somewhere in the neighborhood of 3 to 3.25%, so the monetary backdrop remains comfortably accommodative with fed funds at 2.25% and seemingly heading to 2% or lower in the coming months. Our estimate of equilibrium is no more than an estimate, however, so we are reprising our analysis of where consumption, investment and government spending are headed over the next six to twelve months. We remain constructive on the basis of that analysis. The GDP Equation GDP is the sum of consumption, investment, government spending and net exports. Rendered as an equation, GDP = C + I + G + (X-M). Net exports are not terribly meaningful for the comparatively closed U.S. economy, and we take a small fixed trade deficit as a given, so we reduce the equation to GDP = C + I + G. Ex-trade, consumption accounts for two-thirds of output, and fixed investment and government spending for one-sixth each. At four times each of the other components’ weight, consumption is the dominant driver of U.S. activity. Investment is considerably more variable, however, making it more likely to wipe out trend growth from the other drivers (Chart 4). As we showed the first time we performed the (C+I+G) analysis, investment would only have to fall to 0.83 standard deviations below its long-run mean to zero out 2% growth in consumption and government spending.1 Chart 4Investment Is The Wild Card In a normal distribution, events 0.83 or more standard deviations below the mean are expected to occur randomly about 20% of the time. It would take a -1.31-sigma consumption event (probability ≈ 10%) to zero out 2% growth in the rest of the economy. An expansion-killing decline in government spending would be a -1.86-sigma event (probability ≈ 3%). Investment is most likely to be the swing factor tilting the economy in the direction of a recession. Consumption Both retail sales and personal consumption expenditures have accelerated since early April (Chart 5). A robust labor market should continue to support consumption spending, as our payroll model projects a pickup in hiring (Chart 6, top panel), thanks to more ambitious NFIB hiring plans (Chart 6, second panel) and falling initial unemployment claims (Chart 6, bottom panel). Job openings are at their highest level in the 19-year history of the series, indicating that demand for new employees is high, and an elevated quits rate indicates that employers are paying up to poach workers from each other to satisfy that demand. We reiterate that more Americans will be working at the end of 2019 than at the end of 2018, and that all of them will be getting paid more, on average. A robust labor market will give household incomes a boost, and solid balance sheets will give them leave to spend it. Households don’t have to spend income gains, however. If they choose instead to save them, or divert them to paying down debt, consumption won’t get much of a near-term boost. The state of household balance sheets is also a driver of consumption’s direction, and they’ve improved at the margin since our last review. The savings rate moved sharply higher in the interim (Chart 7, top panel) and household debt as a share of GDP ticked lower (Chart 7, second panel), while the burden of servicing existing debt remains light (Chart 7, bottom panel). Chart 5Consumption Is Healthy Chart 6Hiring Is Poised To ##br##Tick Higher, ... Chart 7... And Households Are In A Position To Spend Bottom Line: Consumption remains well supported and will likely continue to be over a six- to twelve-month horizon. Investment Despite hopes that the reduction in corporate income tax rates and immediate expensing of qualified investments would promote capital expenditures, growth in nonresidential fixed investment has been uninspiring. Looking ahead, surveys of corporate investment intentions are decent coincident indicators of capex, and their monthly releases provide some leading insights into quarterly GDP investment. Capital spending plans in the NFIB small business survey have bounced since early April (Chart 8, top panel), but capex plans in the regional Fed surveys have weakened (Chart 8, bottom panel). Although both surveys have turned down, they remain at fairly elevated levels, suggesting that an investment plunge capable of negating trend growth in consumption and government spending is unlikely. Chart 8Neither Here Nor There Residential investment is less than a quarter of nonresidential investment and therefore typically only has a marginal impact on investment. It remains in a slump, with momentum in starts and permits sputtering (Chart 9, top panel); existing home sales running in place (Chart 9, middle panel); and inventories of homes for sale up since April, albeit still at low levels relative to history (Chart 9, bottom panel). Despite a sharp decline in mortgage rates since the end of last year, housing activity has failed to revive. Conversations with various market participants lead us to believe that zoning restrictions, sparse quantities of affordable land, difficulty in assembling construction crews, and a general idling of smaller developers in the wake of the crisis have all contributed to insufficient supplies of the entry-level and first-move-up homes for which there is ample demand. Chart 9Housing Is Weaker Than It Should Be, But It Doesn't Mean The Economy Is In Trouble Bottom Line: Neither nonresidential nor residential investment appears vulnerable enough to spark a decline in investment that could cause the economy to stall out. Government Spending All systems are go from a fiscal perspective. The federal spending taps will surely be open in a hotly contested presidential election year. State income and sales tax revenues have improved since our last review in April (Chart 10, top two panels), and should be well supported by a strong labor market. Solid home price appreciation will nudge the appraisals underpinning property taxes higher (Chart 10, third panel), supporting municipal tax receipts. Government spending will continue to hold up its end. Chart 10State And Local Revenues Will Hold Up Is Inflation Dead? Chart 11Another Upleg Is Coming We participated in a panel discussion last week at an inflation-linked products conference. The panel included Fed researchers and a veteran inflation-products trader turned investment manager. After a wide-ranging discussion that touched on U.S. economic prospects, the message from the yield curve, the impact of trade tensions and the continuing relevance of the Phillips Curve, each panelist was asked if inflation has already peaked for the cycle. The response was a resounding unanimous yes until we got our turn. The other panelists were not laypeople, traders, bottom-up analysts, or anyone else with only a passing interest in macroeconomics. They were experts, and we were struck by the conviction with which they dismissed the possibility that inflation could yet break out in the current cycle. Judging by the shrinking scale of the annual conference (this year’s edition was half the size of the previous two years’), the idea that inflation is dead for the foreseeable future has found a wide following. We do not think that inflation, and bond yields, will go anywhere in the immediate future, but it is far from assured that they will remain moribund for the rest of the expansion (Chart 11). Taking the other side looks attractive to us, given the preponderance of inflation-is-dead opinions. It is not terribly surprising that wide output gaps opened following an especially job-destructive downturn. With economic capacity considerably ahead of aggregate demand across the major economies, inflation had little chance of taking hold at an economy-wide level. The picture is changing, however, with the IMF estimating that the U.S. output gap closed in 2017 and in the advanced economies as a whole sometime last year (Chart 12). Goods inflation is primarily a global phenomenon, and with the IMF estimating that output gaps persist in Australia, Canada, Japan and the U.K., international slack can still mitigate domestic price pressures, though new tariff barriers would bind inflation more closely to domestic conditions. Services inflation, which is much more domestically driven, could begin to perk up now that unemployment is below NAIRU in the Eurozone as well as the U.S. (Chart 13). Finally, while central banks are hardly omnipotent, Milton Friedman’s always-and-everywhere admonition leaves little doubt that the monetary authorities can boost inflation expectations if they really want to. Chart 12Demand Has Caught Up To Capacity Chart 13Mind The Gap Investment Implications The investing backdrop is hardly ideal. Spreads are tight, stocks aren’t cheap, the two largest standalone economies are trying to inflect pain on each other, the U.K. can’t agree on how to get divorced from the EU, and the fate of the longest U.S. expansion on record is in doubt. The risks are well known, however, and save-haven assets have gotten pretty crowded. While the danger that shaky confidence could become self-fulfilling is real, our base case is that the expansion will trundle along, allowing stocks to rise as the worst-case scenarios fail to come to pass. It is at least possible that rumors of inflation’s demise have been greatly exaggerated. We continue to recommend that investors remain at least equal weight equities in balanced portfolios and at least equal weight spread product within bond allocations. We enthusiastically endorse our bond colleagues’ overweight TIPS recommendation. When nearly everyone agrees that a particular outcome cannot happen, it is often worth carving out some space in a portfolio in the event it actually does. Doug Peta, CFA Chief U.S. Investment Strategist dougp@bcaresearch.com Footnotes 1 Please see Table 1 of the April 8, 2019 U.S. Investment Strategy Weekly Report, “If We Were Wrong,” available at usis.bcaresearch.com
Highlights Global bond yields have closely tracked the trajectory of global growth. While the global economy remains fragile, some positive signs are emerging: Our global leading economic indicator has moved off its lows; global financial conditions have eased significantly; U.S. household spending remains resilient; and China is set to further increase stimulus. Neither a severe escalation of the trade war nor a hard Brexit is likely. A simple comparison between current dividend yields and bond yields implies that global equities would need to fall by an outsized amount over the next decade for bonds to outperform stocks. As global growth stabilizes and then begins to recover over the coming months, bond yields will rebound from depressed levels. Investors should overweight stocks versus bonds for now, and look to upgrade EM and European equities later this year. Feature Global Growth Driving Bond Yields Chart 1Global Bond Yields: How Low Will They Go? Global bond yields rose sharply yesterday on word that U.S. and Chinese trade negotiators will meet in October. The announcement by China’s State Council of additional stimulus measures and better-than-expected data on the health of the U.S. service sector also drove the bond sell-off. The jump in yields follows a period of almost unrelenting declines. After hitting a high of 3.25% last October, the U.S. 10-year yield fell to 1.43% this Tuesday, just shy of its all-time low of 1.34% reached on July 5, 2016. The 30-year Treasury yield broke below 2% for the first time in history on August 15, falling to as low as 1.91% this week. It now stands at 2.07%. In Japan and across much of Europe, bond yields remain firmly in negative territory (Chart 1). The large movements in bond yields can be attributed to both the state of the global economy as well as to changes in how central banks are reacting to economic uncertainty. Just as stronger global growth pushed yields higher between mid-2016 and early-2018, the deceleration in growth since then has pulled yields lower. Chart 2 shows that there has been a close correlation between changes in the U.S. 10-year yield and the ISM manufacturing index. The release on Tuesday of a weaker-than-expected ISM manufacturing print for August was enough to push the 10-year yield down by seven basis points within a matter of minutes. Chart 2The Deceleration In Growth Has Pulled Yields Down The forward-looking new orders component of the ISM manufacturing index sunk to a seven-year low. The export orders component fell to the lowest level since 2009. Export volumes track ISM export orders quite closely (Chart 3). Not surprisingly, the ISM press release noted that trade remains “the most significant issue” for U.S. manufacturers. Chart 3Export Volumes Track The ISM Export Component The only redeeming feature in the report was that the customers’ inventories index dropped a notch from 45.7 in July to 44.9 in August. A reading below 50 for this subindex indicates that manufacturers believe that their customers are holding too few inventories, which is positive for future production. Global Manufacturing PMI Not Looking Much Brighter The Markit global manufacturing PMI remained below 50 for the fourth month in a row in August. While the global PMI did edge up slightly from July’s reading, this was largely due to a modest rebound in the Chinese PMI, which rose from 49.9 to 50.4. The improvement in the China Markit-Caixin PMI stands in contrast to the further deterioration observed in the “official” National Bureau of Statistics PMI. The former is more heavily geared towards private-sector exporting companies, and hence may have been influenced by the front-loading of exports ahead of the planned tariff increase on Chinese exports to the United States. Some Positive Signs Chart 4Global LEI Has Moved Off Its Lows In light of the disappointing manufacturing data, it is too early to call a bottom in the global industrial cycle. Nevertheless, there are some hopeful signs. Our Global Leading Economic Indicator (LEI) has moved off its lows (Chart 4). It usually leads the PMIs by a few months. Sterling will probably be the best performing currency in the G7 over the next five years. Despite ongoing weakness in the manufacturing sector, household spending has held up in most economies. In the U.S., the nonmanufacturing ISM index jumped to 56.4 in August from 53.7 in July. Real personal consumption is still on track to grow by 2.8% in Q3 according to the Atlanta Fed (Chart 5). The euro area services PMIs have also been resilient (Chart 6). In Germany, where the manufacturing PMI stood at 43.5 in August, the services PMI rose to 54.8. Chart 5Inventories And Net Exports Have Subtracted From U.S. Growth In Q2 And Q3 Chart 6AThe Service Sector Has Softened Much Less Than Manufacturing (I) Chart 6BThe Service Sector Has Softened Much Less Than Manufacturing (II) Global financial conditions have eased significantly, mainly thanks to the steep decline in bond yields. The current level of financial conditions implies that global growth could rebound swiftly (Chart 7). The Chinese government is also likely to step up fiscal/credit stimulus over the coming months in an effort to shore up growth. In a boldly worded statement released on Wednesday, the Chinese State Council promised to further increase bond issuance to finance infrastructure projects, while cutting interest rates and reserve requirements. A stronger Chinese economy should benefit global growth (Chart 8). Chart 7Easier Financial Conditions Will Benefit Global Growth Chart 8Stronger Chinese Growth Should Benefit The Global Economy The Trade War: Moving Towards A Détente? The announcement that the U.S. and China will resume trade negotiations on October 5th is a step in the right direction. As we noted last week, both parties have an incentive to de-escalate the trade conflict. President Trump wants to prop up the stock market and the economy in order to improve his re-election prospects. China also wants to bolster growth.1 Chart 9Would China Really Be Better Off Negotiating With A Democrat As President? As difficult as it has been for China to deal with Donald Trump, trying to secure a trade deal with him after he has been re-elected would be even more challenging. This would be especially the case if Trump thought that the Chinese had tried to sabotage his re-election bid. Even if Trump were to lose the election, it is not clear that China would end up with someone more palatable to deal with on trade matters. Does the Chinese government really want to negotiate over labor standards and human rights with President Warren, who betting markets now think has a better chance of becoming the Democratic nominee than Joe Biden (Chart 9)? While Republicans in Congress would be able to restrain a Democratic president on domestic issues, the president would still enjoy free rein over trade policy. Brexit Uncertainty Adding To Investor Angst Two weeks before the Brexit vote on June 23, 2016, I wrote that “Just like my gut told me last August that Trump would do much better at the polls than almost anyone thought possible, I increasingly feel that come June 24th, the EU may find itself with one less member.”2 Chart 10Brexit Opposition Has Been Growing Soon after the shocking verdict, we argued that a hard Brexit would prove to be politically infeasible, meaning that the U.K. would either end up holding another referendum or be forced to negotiate some sort of customs union with the EU. Our view that a hard Brexit will not happen has not changed. Chart 10 shows that opposition to Brexit has only grown since that fateful day. Boris Johnson does not have enough votes in Westminster to force a hard Brexit. Another election would not change this outcome, given that it would almost certainly produce a hung parliament. In any case, it is not clear that Johnson actually wants a hard Brexit. The Times of London recently reported that the government’s own contingency plans for a hard Brexit, weirdly code-named “Operation Yellowhammer,” predicted a crippling logjam at British ports leading to shortages of fuel, food and medicine.3 Boris Johnson is all hat and no cattle. He will be forced to make a deal with the EU. Buy the pound on any dips. Sterling will probably be the best performing currency in the G7 over the next five years. Central Banks: Cut First, Ask Questions Later Chart 11Inflation Expectations Are Low Across The Globe Despite a few glimmers of good news, central banks are in no mood to take any chances. St. Louis Fed President James Bullard said it bluntly last week: “Our job is to get the yield curve uninverted.”4 If history is any guide, global growth will stabilize and begin to recover over the coming months. Inflation expectations are below target in most economies (Chart 11). Central banks know full well that if the current slowdown morphs into a full-blown recession, they will be out of monetary ammunition very quickly. In such a setting, it does not make sense to hold your punches. Much better to generate as much inflation as possible, and as soon as possible, so that real rates can be brought deeper into negative territory if economic circumstances later warrant it. What If The Medicine Works? The risk of easing monetary policy too much is that economies will eventually overheat, producing more inflation than is desirable. It is easy to forget that the aggregate unemployment rate in the G7 is now below its 2007 lows (Chart 12). True, inflation has yet to take off, but this may simply be because inflation is a lagging indicator (Chart 13). Chart 12Unemployment Rates Keep Trending Lower Chart 13Inflation Is A Lagging Indicator For all the talk about how the Phillips curve is dead, the empirical evidence suggests it is very much alive and well (Chart 14). Ironically, this means that lower interest rates today could set the stage for much higher rates in the future if hyperstimulative monetary policies ultimately generate a bout of inflation. Chart 14The Phillips Curve Is Alive And Well Chart 15The Dollar Is A Countercyclical Currency Investment Conclusions Like most economic forecasters, central banks tend to extrapolate recent trends too far into the future. Global growth has been weakening since early 2018 so it seems reasonable to assume that this trend will persist into next year. However, as we have documented, global industrial cycles tend to last about three years – 18 months of rising growth followed by 18 months of falling growth.5 If history is any guide, global growth will stabilize and begin to recover over the coming months. Should that occur, we will enter an environment where the lagged effects of easier monetary policy are hitting the economy just when the manufacturing cycle is taking a turn for the better. Stocks are likely to fare well in such a setting, while long-term bond yields will move higher. As a countercyclical currency, the dollar will also start to weaken anew (Chart 15). Granted, an intensification of the trade war or some other major adverse shock would upset this rosy forecast. Nevertheless, current market pricing offers a fairly large cushion against downside risks. Thanks to the drop in bond yields, the equity risk premium is quite high globally (Chart 16). Even if one were to assume that nominal dividend payments remain unchanged for the next ten years, the S&P 500 would still need to fall by more than 20% in real terms over the next decade for bonds to outperform stocks (Chart 17). Euro area stocks would need to drop by more than 42%. U.K. stocks would need to plummet by at least 60%! Chart 16AEquity Risk Premia Remain Quite High (I) Chart 16BEquity Risk Premia Remain Quite High (II) Chart 17AStocks Need To Fall By A Considerable Amount For Bonds To Outperform Over A 10-Year Horizon (I) Chart 17BStocks Need To Fall By A Considerable Amount For Bonds To Outperform Over A 10-Year Horizon (II) Investors should remain overweight stocks versus bonds over the next 12 months. We intend to upgrade EM and European equities once we see a bit more evidence that global growth has troughed. Peter Berezin, Chief Global Strategist Global Investment Strategy peterb@bcaresearch.com Footnotes 1Please see Global Investment Strategy Weekly Report, “A Psychological Recession?” dated August 30, 2019. 2Please see Global Investment Strategy Weekly Report, “Worry About Brexit, Not Payrolls,” dated June 10, 2016. 3Rosamund Urwin and Caroline Wheeler, “Operation Chaos: Whitehall’s Secret No-Deal Brexit Preparations Leaked,” The Times, August 18, 2019. 4“Fed’s Bullard Sees ‘Robust Debate’ Over Half-Point Cut,” Bloomberg, August 23, 2019. 5Please see Global Investment Strategy Weekly Report, “Three Cycles,” dated July 26, 2019. Strategy & Market Trends MacroQuant Model And Current Subjective Scores Strategic Recommendations Closed Trades
Highlights The lingering global manufacturing recession and the substantial drop in U.S. bond yields have been behind the decoupling between both EM stocks and the S&P 500, and cyclical and defensive equities. Neither the most recent economic data, nor the relative performance of global cyclicals, China-related plays and high-beta markets herald a broad-based and lasting risk-on phase in global markets. On the contrary, economic and market signposts continue to indicate either further bifurcation in global markets or a risk-off period. We review some of our long-standing themes and associated recommendations. Feature Global financial markets have become bifurcated. On one hand, numerous segments of global financial markets leveraged to global growth, including EM stocks, have already sold off (Chart I-1). On the other hand, share prices of growth companies, defensive stocks and global credit markets have remained resilient. Chart I-2 shows that a similar divergence has taken place within EM asset classes: EM share prices have plummeted while EM corporate credit excess returns have not dropped much. Chart I-1Bifurcated Equity Markets Chart I-2Bifurcated Markets In EM How to explain this market bifurcation? Financial markets sensitive to global trade and manufacturing cycles have been mirroring worsening conditions in global trade and manufacturing. Some of the affected segments include: Global cyclical equity sectors. Emerging Asia manufacturing-related currencies (KRW, TWD and SGD) versus the U.S. dollar (Chart I-3). EM and DM commodity currencies (Chart I-4). Chart I-3Total Return (Including Carry): KRW, TWD And SGD Vs. USD Chart I-4EM And DM Commodity Currencies Industrial and energy commodities prices. U.S. high-beta stocks as well as U.S. small caps (Chart I-5). Chart I-5U.S. High-Beta Stocks DM bond yields. Crucially, the current global trade and manufacturing downturns have taken place despite robust U.S. consumer spending. In fact, our theme for the past several years has been that a global business cycle downturn would occur despite ongoing strength in American household spending. The rationale has been that China and the rest of EM combined are large enough on their own to bring down global trade and manufacturing, irrespective of strength in U.S. consumer spending. At the current juncture, one wonders whether such a market bifurcation is justified. It is not irrational. The basis for decoupling between cyclical and defensive equities has been U.S. bond yields. The substantial downshift in U.S. interest rate expectations has led to a re-rating of non-cyclicals and growth company stocks. Corporate bonds have also done well, given the background of a falling risk-free rate. Will the current market bifurcation continue? Or will these segments in global financial markets recouple and in which direction? What To Watch China rather than the U.S. has been the epicenter of this slowdown, as we have argued repeatedly in the past. Hence, a major rally in global cyclical equities and EM risk assets all hinge on a recovery in the Chinese business cycle. The basis for decoupling between cyclical and defensive equities has been U.S. bond yields. The substantial downshift in U.S. interest rate expectations has led to a re-rating of non-cyclicals and growth company stocks. Even though Caixin’s PMI for China was slightly up in August, many other economic indicators remain downbeat: The latest hard economic data out of Asia suggest that global trade/manufacturing continues to contract. Korea’s total exports in August contracted by 12.5% from a year ago, and its shipments to China plunged by 20% (Chart I-6). The import sub-component of China’s manufacturing PMI is not showing signs of amelioration (Chart I-7). The mainland’s import recovery is very critical to a revival in global trade and manufacturing. Chart I-6Korean Exports: No Recovery Chart I-7Chinese Imports To Remain Weak Chart I-8German Manufacturing Confidence German manufacturing IFO business expectations and current conditions both suggest that it is still early to bet on a global trade recovery (Chart I-8). Newly released August data points reveal that U.S., Taiwanese, and Swedish manufacturing new export orders continue to tumble. To gauge whether bifurcated markets will recouple and whether it will occur to the downside or the upside, investors should watch the relative performance of China-exposed markets, global cyclicals and high-beta plays – the ones that have already sold off substantially. The notion is as follows: These markets’ relative performance will likely bottom before their absolute performance recovers. If so, their relative performance will likely foretell the outlook for their absolute performance. Concerning share prices of growth companies, defensive equity sectors and credit markets, these segments are at risk because of expensive valuations and crowded investor positioning. In other words, they could sell off even if a global recession is avoided. Concerning share prices of growth companies, defensive equity sectors and credit markets, these segments are at risk because of expensive valuations and crowded investor positioning. To assess the outlook for global cyclicals and China-related plays, we are monitoring the following financial market indicators: The Risk-On/Safe-Haven currency ratio is the average of high-beta commodity currencies such as the CAD, AUD, NZD, BRL, CLP and ZAR total return (including carry) indices relative to the average of JPY and CHF total returns (including carry). This ratio is dollar-agnostic. This ratio is making a new cyclical low (Chart I-9). Hence, it presently warrants a negative view on global growth, China’s industrial sector and commodities. Global cyclical equity sectors seem to be on the edge of breaking down versus defensives (Chart I-10). This ratio does not signal ameliorating global growth conditions. Chart I-9The Risk-On/Safe-Haven Currency Ratio Chart I-10Global Cyclicals Versus Defensives Chart I-11U.S. High-Beta Stocks Versus S&P 500 Finally, U.S. high-beta stocks continue to underperform the S&P 500 (Chart I-11). This is consistent with overall U.S. growth deceleration. Bottom Line: Neither the most recent economic data, nor the relative performance of global cyclicals, China-related plays and high-beta markets herald a broad-based and lasting risk-on phase in global markets. On the contrary, economic and market signposts continue to foreshadow either further bifurcation in global markets or a risk-off period. Continue trading EM stocks and currencies on the short side, and underweighting EM risk assets versus DM. Our Investment Themes And Positions Some of our open positions often run for years because they reflect our long-standing themes. Our core theme has for some time been that a global trade/manufacturing recession will be generated by a growth relapse in China. To capitalize on this theme, we have been recommending a short EM stocks / long 30-year U.S. Treasurys strategy since April 2017. This recommendation has produced a 25% gain since its initiation (Chart I-12). Continue betting on lower local interest rates in emerging economies where the central bank can cut rates despite currency depreciation. To implement this theme, we have been recommending receiving swap rates in Korea and Chile for the past several years. Our reluctance to recommend an outright buy on local bonds stems from our bearish view on both currencies – the Korean won and Chilean peso. In fact, we have been shorting both the KRW and the CLP against the U.S. dollar. Chart I-13 shows that swap rates in Korea and Chile have dropped substantially since our recommendations to receive rates in these countries. More rate cuts are forthcoming in these economies, and we are maintaining these positions. Chart I-12EM Stocks Have Massively Underperformed U.S. Bonds Chart I-13Continue Receiving Rates In Korea And Chile We have been bearish on EM banks in general and Chinese banks in particular. We have expressed these themes in a number of ways: Short EM and Chinese / long U.S. bank stocks. Short EM banks / long EM consumer staples (Chart I-14). Within Chinese banks, we have been short Chinese medium and small banks / long large ones. All these strategies remain valid. In credit markets, we have been favoring U.S. corporate credit versus EM sovereign and corporate credit. Ability to service debt is better among U.S. debtors than EM/Chinese borrowers. We have been playing this theme in the following ways: Underweight EM sovereign and corporate credit / overweight U.S. investment-grade corporates (Chart I-15). Chart I-14Short EM Banks / Long EM Consumer Staples Chart I-15Underweight EM Credit / Overweight U.S. Investment-Grade Corporates Underweight Asian high-yield corporate credit / overweight emerging Asian investment-grade corporates. As a bet on a deteriorating political and business climate in Hong Kong, in our Special Report on Hong Kong SAR from June 27, we reiterated the following positions: Short Hong Kong property stocks / long Singapore equities. Arthur Budaghyan Chief Emerging Markets Strategist arthurb@bcaresearch.com Mexico: Crying Out For Policy Easing The Mexican economy is heading into a full-blown recession. Most segments of the economy are in contraction, and leading indicators point to further downside. Both manufacturing and non-manufacturing PMIs are well below 50 (Chart II-1). Monetary policy remains too restrictive: Nominal and real interest rates are both very high and plunging narrow money (M1) growth is signaling further downside in economic activity (Chart II-2). Chart II-1The Economy Is Deteriorating Chart II-2Narrow Money Points To Negative Growth An inverted yield curve signifies that the central bank is behind the curve and foreshadows growth contraction (Chart II-3). Fiscal policy has tightened as the government has remained committed to achieving a primary fiscal surplus of 1% of GDP in 2019 (Chart II-4, top panel). Consequently, nominal government expenditures have been curbed (Chart II-4, bottom panel). The government’s fiscal stimulus has not been large and has been implemented too late. Chart II-3A Message From The Inverted Yield Curve Chart II-4Fiscal Policy Has Tightened A Lot Finally, business confidence is extremely low due to uncertainty over President Andrés Manuel López Obrador’s (AMLO) policies towards the private sector. The president is attempting to revive business confidence, but it will take time. Chart II-5Mexico Versus EM: Domestic Bonds And Sovereign Credit Our major theme for Mexico has been that both monetary and fiscal policies are very tight. Consequently, we have been recommending overweight positions in Mexican domestic bonds and sovereign credit relative to their respective EM benchmarks. (Chart II-5). Recessions are bad for share prices, but in tandem with prudent macro policies, they can be positive for fixed-income markets. Meanwhile, we have been favoring the Mexican peso relative to other EM currencies due to the fact that AMLO is not as negative for the country as was initially perceived by markets. With inflation falling and the Federal Reserve cutting rates, Banxico will ease further. Yet, it will likely cut rates slower than warranted by the economy. The longer the central bank takes to ease, the lower domestic bond yields will drop. Concerning sovereign credit, investors should remain overweight Mexico within an EM credit portfolio. Mexico’s fiscal position is healthier, and macroeconomic policies will be more prudent relative to what the market is currently pricing. We continue to believe concerns about Pemex’s financing and its impact on government debt are overblown, as we discussed in detail in our previous Special Report. In July, the government released an action plan for Pemex financing. We view this plan as marginally positive. To supplement this plan, the government can use the $14.5 billion federal budget stabilization fund to fill in financing shortfalls in the coming years. Importantly, the starting point of Mexican public debt is quite low, which will allow the government to finance Pemex in the years to come by borrowing more from markets. Recessions are bad for share prices, but in tandem with prudent macro policies, they can be positive for fixed-income markets. Lastly, our overweight recommendation in Mexican stocks has not played out. However, we are maintaining it for the following reasons: Chart II-6 illustrates that when Mexican domestic bond yields decline relative to EM ones (shown inverted on Chart II-6), Mexican share prices usually outperform their EM counterparts in common currency terms. Consistent with our view that Mexican local currency bonds will outperform their EM peers, we expect Mexican stocks to outpace the EM equity benchmark. The Mexican bourse’s relative performance against EM often swings with the relative performance of EM consumer staples versus the EM equity benchmark. This is due to the large share of consumer staples stocks in Mexico (34.5%) compared to that in the EM benchmark (7%). Consumer staples stocks are beginning to outpace the EM equity index, raising the odds of Mexican equity outperformance versus its EM peers (Chart II-7). Chart II-6Local Bond Yields And Relative Stocks: Mexico Versus EM Chart II-7Consumer Staples Have A Large Weight In Mexican Bourse We do not expect a major rally in this nation’s stock market given the negative growth outlook. Our bet is that Mexican share prices - having already deflated considerably - will drop less in dollar terms than the overall EM equity index. Bottom Line: We continue to recommend an overweight stance on Mexican sovereign credit, domestic bonds and equities relative to their respective EM benchmarks. The main risk to the Mexican peso stems from persisting selloff in EM currencies. Traders’ net long positions in the MXN are elevated posing non-trivial risk (Chart II-8). We have been long MXN versus ZAR but are taking profit today. This trade has generated a 9.7% gain since March 29, 2018. A plunging oil-gold ratio warrants a caution on this cross rate in the near term (Chart II-9). Chart II-8Investors Are Long MXN Chart II-9Take Profits On Long MXN / Short ZAR Trade Juan Egaña, Research Associate juane@bcaresearch.com Arthur Budaghyan Chief Emerging Markets Strategist arthurb@bcaresearch.com Footnotes Equities Recommendations Currencies, Credit And Fixed-Income Recommendations