Developed Countries

The German DAX has rallied by 26.4% since the beginning of Q4 2022, outperforming the Euro Stoxx 50 by 5.7% in the process. With industrial equities accounting for a relatively large share of the German index, the bourse is benefitting from the improvement…

3 years ago

Essentials

Will Recovering Sentiment Boost US Consumption?

The preliminary results from the University of Michigan survey suggest that US consumer morale continues to grind higher. The headline index ticked up 1.5 points to a 13-month high of 66.4 on the back of a 4.2-point jump in the current conditions index.…

3 years ago

Essentials

The Riksbank Wants A Stronger SEK

As expected, Sweden’s Riksbank delivered a 50 bp rate hike at its meeting on Thursday, bringing the policy rate to 3.0%. and signaled that further hikes are likely. Moreover, it announced that beginning in April it will start selling nominal and real…

3 years ago

Essentials

The Sequence Of Events Leading To Recession Is Always The Same

According to BCA Research’s Counterpoint service, the US jobs market remains strong because economy-wide profits have not declined enough to trigger widespread layoffs. It’s not every day that there’s a global pandemic. Then again, it’s not every day that…

3 years ago

FICC

War And The Threat Of War

The tempo of China’s and the US’s military operations is picking up sharply. The risk of a sudden, perhaps unintended, escalation of military conflict, therefore, is rising in the South China Sea. So is the risk of another shooting war in the Middle East. Against this backdrop, China’s reopening, marginally stronger GDP growth, and massive fiscal stimulus to support renewables and defense is being rolled out. In states with high debt-to-GDP ratios like the EU and US, the risk of fiscal dominance is rising, and with it higher inflation. We remain long the XOP oil and gas ETF; the XME metals and mining ETF, and long the commodity COMT ETF to hedge this risk.

3 years ago

Commodities

FICC

The RBA And BoC Diverge: Implications For AUD/CAD

In this Strategy Insight, we go over the RBA’s recent decision and the implications of its hawkish message for AUD trades.

3 years ago

Currencies

Essentials

Positive Economic Data Surprises From Japan

Japan’s Economy Watchers Survey – which is based on responses from over 2,000 workers from a variety of sectors that are sensitive to domestic economic conditions – suggests that businesses are becoming less pessimistic about the economic outlook. Although…

3 years ago

Essentials

The US Affordable Housing Challenge

The positive impact of the 79 basis point decline in mortgage rates since November is making its way to the housing market data. Mortgage applications and pending home sales appear to have bottomed, with the latest update showing a 7.4% jump in mortgage…

3 years ago

Essentials

Don’t Chase Junk Spreads Lower

Junk bonds have been on fire during the past few months. Since the end of June, the sector has delivered a total return of 7.9% and has bested duration-matched US Treasuries by a whopping 9.5%. Our US bond strategists don’t advise chasing junk spreads…

3 years ago

Essentials

Were US Treasurys Always A Good Diversifier To Equity Risk For Long-Term Investors?

BCA Research’s Global Asset Allocation service concludes that for investors who maximize risk-adjusted returns, US Treasurys were always a good risk diversifier to US equities in nominal terms, but the same could not be said in real terms. For risk-minimizing…

3 years ago

Developed Countries

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