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Financial Markets

China’s Strong July Imports Hide Lackluster Demand
Chinese exports in USD terms missed expectations in July, growing by 7.0% y/y, down from 8.6% in June. Conversely, imports rebounded smartly from a 2.3% contraction, rising by 7.2% in July and upending expectations of 3.2%. Slower export growth is…
Daily Insights
Yen’s Path Remains Higher Despite BoJ’s Dovish Signal
The BoJ delivered a surprise rate hike last week, then proceeded to sending a more dovish signal on Wednesday. Deputy Governor Shinichi Uchida strongly hinted at a central bank that would refrain from hiking further in times of market instability. The yen,…
Daily Insights
Challenging the Consensus on Household Excess Savings
According to BCA Research’s GeoMacro Strategy service, the reason that the bears have been wrong for the past 18 months is that consumers have defied the expectations of most learned economists. As our colleagues posited in late 2023, US consumers would not…
Daily Insights
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Failed Breakouts Warn Of Bear Market Ahead

The prices of multiple financial assets have failed to break above their technical resistances. When this occurs, a breakdown ensues. In brief, global risk assets remain vulnerable. We are upgrading Chinese onshore stocks from neutral to overweight and offshore ones from underweight to neutral within EM and global equity portfolios.

Emerging Markets Strategy by Arthur Budaghyan
US Sneezes, ROW Will Catch A Cold
US economic news has stolen the spotlight in the past several days but economic developments in the rest of the world have also been uninspiring. The JPM Global Manufacturing PMI dipped into contraction territory in July, deteriorating from 50.8 to 49.7…
Daily Insights
The Case For Overweighting The US, Even Now
August’s selloff has featured a rotation out of Big Tech. The Nasdaq shed 8% across Thursday, Friday, and Monday, led by concentrated selling among several Mega caps. Nvidia, Tesla, Microsoft and Amazon shed 14%, 14%, 6% and 14% over the last three sessions,…
Daily Insights
The Stock-Bond Correlation Breaks Down When Inflation Runs High
According to BCA Research’s Global Asset Allocation service, while the market action of the past few weeks is pointing to a return to a negative stock-bond correlation, more prints will be needed to confirm things are getting back to normal. The post-COVID…
Daily Insights
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The Fly In The Soft Landing Ointment

Mounting evidence that the labor market is on its way to cracking checked two more boxes on our checklist, driving us to tactically downgrade equities to underweight while upgrading fixed income to overweight. Our tactical and cyclical (6-12 months) views are now aligned as our conviction that a recession will begin before year-end has increased.

US Investment Strategy by Doug Peta
July In Review
No clear risk-on/risk-off pattern emerged from July’s market performance data. On the one hand, consistent with a risk-off environment, US bonds ranked highest in the monthly return distribution, while pro-cyclical industrial metals and oil lagged.…
Daily Insights
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US Politics In August And September

Republicans are favored but the election is still competitive. Equities, corporate credit, and cyclical sectors will fall until policy uncertainty is reduced.

US Political Strategy by Yushu Ma, Matt Gertken, Jesse Anak Kuri

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