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Financial Markets

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Trump's Historic Comeback: What Catches Our Eye

Trump’s resounding victory brings a popular mandate that ensures deregulation and higher trade tariffs. Higher budget deficit and immigration reform are also in the cards as the Republicans look like they may squeak a thin margin in the House of Representatives. Foreign policy will become more unilateral, with US assets outperforming initially.

BCA Special Reports by Matt Gertken
Can Powell Stick The Landing Before the Trump Storm?
Our Global Asset Allocation Strategy colleagues argue in their monthly report that while a soft landing is a possibility, it is already reflected in asset pricing. A Trump victory would be a threat to this scenario. Inflation pressures are abating, and the…
Daily Insights
China PMIs: A Rebound From Low Levels
China’s Caixin Manufacturing PMI rebounded one point in October to 50.3. This was in line with the NBS PMIs from earlier this week, which also showed a modest rebound. We are looking for a turning point in China as the government unrolls stimulus measures.…
Daily Insights
US: The Disinflationary Trend Is Intact
The Fed’s preferred measure of inflation, core PCE, met expectations of a reacceleration to 0.3% month-on-month, and reached 2.7% year-over-year. The rest of the Personal Income and Outlays report showed solid consumption growth, although supported by a…
Daily Insights
Copper Remains Vulnerable
Speculators have supported copper prices as demand growth slowed below the pace of supply growth. Our Commodity and Energy Strategy colleagues believe this does not bode well for the metal. The copper market faces a situation where demand growth will be…
Daily Insights
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EM Credit Markets: Nirvana Or A Mirage?

EM credit markets have recently defied the selloffs in EM equities, currencies, local currency bonds, and commodity prices. Such a decoupling is unusual. Resilient US growth and Fed easing are not sufficient to justify very low EM credit spreads.

Emerging Markets Strategy by Ziyuan Huang, Arthur Budaghyan
US GDP: Still Strong
Advanced Q3 GDP for the US met expectations, showing 2.8% quarterly annualized growth and a small deceleration from 3.0% in Q2. Importantly, growth remains above trend. The report was strong across the board except for housing. It also highlights that US…
Daily Insights
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Germany: Sick But Not Dead

Germany’s economy has lagged that of the rest of Europe for nearly 10 years. So have German stocks. Investors are extrapolating these trends to bet on the country’s deindustrialization. Could Germany manage to beat dismal expectations?

European Investment Strategy by Mathieu Savary
Keeping An Eye On The Oil-Rates Correlation
For the past two weeks, oil has sold off amid a global spike in yields. Oil prices and Treasury yields tend to be positively correlated, as oil prices are a fast-moving component of inflation, driving the inflation expectations component of bond yields. …
Daily Insights
China Stimulus: Not Enough To Boost Animal Spirits
While moving in the right direction, China’s latest stimulus measures are falling short of the mark to reflate the economy. The latest rumors extend this trend. News agencies reported discussions of a CNY 10 trillion bond issuance over three years. Six…
Daily Insights

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