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Economy

Sector Chart Pack: Will Rising Rates Break Equities?

In this first presentation of 2025, we start with an overview of the 2025 outlook webcast polls, and a brief post-mortem of the 2024 market performance. Then, we shift gears and examine what is behind the recent surge in bond yields and its implications for equities. We also review market technicals and positioning and conclude with a list of trades to prepare our portfolio for continued moves in yields.

US Equity Strategy by Irene Tunkel
Fade Strong Chinese Exports
China’s December trade data was positive, with exports in USD terms rebounding to 10.7% y/y from 6.7% in November, and imports rebounding to 1.0% from -3.9%. Taken at face value, the numbers are positive for both the Chinese and global economies. However, our…
Daily Insights by Felix-Antoine Vezina-Poirier
Are Inflation Expectations Rising Again?
The preliminary January University of Michigan Consumer Sentiment Index missed estimates on Friday, driven by a cooling of consumer expectations. Worryingly, both the 1-year and 5-to-10 year inflation expectations ticked up to 3.3% from 2.8% and 3.0%,…
Daily Insights by Felix-Antoine Vezina-Poirier
The Bond Market Riot Engulfs Europe
Our European Investment strategists looked at the developed markets bond selloff from a European perspective, focusing on Euro area and UK government bonds and currencies. The recent selloff in European bonds is driven primarily by surging US yields,…
Daily Insights by Felix-Antoine Vezina-Poirier
The Bond Market Riot Engulfs Europe

UK and German bonds are victims of the global bond market riots. Will European yields continue to move higher and will the euro and the pound find a floor anytime soon? 

European Investment Strategy by Mathieu Savary
Strong US Jobs Report Increases Odds Of No-Landing
The US December jobs report came in stronger than expected. Payrolls rose by 256k vs. a downwardly revised 212k in November, leaving the 3-month moving average at about 170k. The unemployment and underemployment rates decreased to 4.1% (from 4.2%) and 7.5%…
Daily Insights by Felix-Antoine Vezina-Poirier
The Financial Conditions-Growth Loop
The global economy is subject to numerous cycles displaying reflexivity and feedback loops. One of these is the relationship between financial conditions and growth. Given this relationship, economic strength can plant the seeds of its own demise.Markets are…
Daily Insights by Felix-Antoine Vezina-Poirier
Five Black Swans For 2025

Every year we highlight five low-odds scenarios that would have a major impact on global financial markets if they happened. This year we contemplate a total reversal of Chinese policy, a US-Iran nuclear deal, a breakdown of NATO, US military action across the Americas, and an internationally coordinated FX intervention.

Geopolitical Strategy by Matt Gertken, Jesse Anak Kuri, Yushu Ma, Max Malakhveitchouk, Junfei Guo
Inflation Expectations Will Keep Rising In 2025, And It Matters Most In Japan
Our Counterpoint Strategy team sees Japanese real yields as the key risk to global equities. Rising inflation expectations in developed markets, excluding Japan, will keep inflation above target and limit further rate cuts. However, in Japan, inflation…
Daily Insights by Felix-Antoine Vezina-Poirier
Higher Yields Risk Breaking The Stock-Bond Correlation
The post-COVID inflation impacted the most important cross-asset relationship: the stock-bond correlation. Higher inflation expectations pushed yields higher, leading to a correction in bond and stock prices. As price pressures receded, bond yields fell and…
Daily Insights by Felix-Antoine Vezina-Poirier

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