Highlights Recommended Allocation The outlook for markets over the next few months is highly uncertain. On the optimistic side, new COVID-19 cases are probably close to peaking (for now), and so equities could continue to…
On Tuesday, BCA Research's Emerging Markets Strategy service downgraded Indian equities from neutral to underweight. Indian stock prices relative to EM in US dollars are breaking below a critical support line. As this…
Highlights Chinese stocks have outperformed global benchmarks by a wide margin. We are taking profits on our overweight position, and downgrading our tactical call on Chinese stocks to neutral. In absolute terms, Chinese stocks have…
The PBOC cut its 7-day reverse repo rate on Monday, as part of an injection of liquidity into the Chinese banking system. Ma Jun, an advisor to the PBOC, guided expectations towards additional cuts by stating that the PBOC had entered…
At first blush, China’s official manufacturing PMI release was encouraging. After having fallen from 50 in January to 35.7 in February, the PMI rebounded to 52 in March. The rise was led by the output subcomponent, which rose from 27…
The COVID-19 pandemic began in China, but it has become the world’s problem. China’s aggressive response to the disease, particularly in Hubei province, means that it is now “outperforming” the world in…
Highlights The pandemic has a negative impact on households and has not peaked in the US. But a depression is likely to be averted. Our market-based geopolitical risk indicators point toward a period of rising political turbulence…
Highlights Rapidly changing news flows are forcing oil markets to recalibrate supply-demand fundamentals continuously. This will keep volatility at or close to recent record highs (Chart of the Week). The demand shock from COVID-19…
Feature We closed our short position in EM equities last week but still maintain our short recommendation on EM currencies. Going forward we will be looking for signs of a durable bottom in risk assets. The clash between forthcoming…