Economists are often lampooned because of their inability to forecast changes in the business cycle. But the pandemic helped them overcome the challenge this time. A record contraction in Q2 was anticipated before in March. Similarly, economists generally expected the recovery after the March-April body blow. However, after an initial surge, some high-frequency data point …
Overview: Escalating dramas may be behind the position adjustment today ahead of the US jobs data. The US and China feud expanded beyond Tiktok to WeChat, and efforts to tighten disclosure rules for Chinese companies listed in the US are nearing. The negotiations between the White House and the Democrats broke down, preventing or at …
Position Adjustment Dominates ahead of US/Canada Employment Reports Read More »
Overview: Asia Pacific equities rallied after the US shares rallied with the Nasdaq reaching record highs after it and the S&P 500 gapped higher yesterday. Japan and Hong Kong led the rally with more than 2% gains, while the Shanghai Composite lagged with about a 0.1% gain. However, the momentum did not carry into Europe, …
Overview: It may be that a new surge in virus cases will elicit more policy support from officials, but the immediate focus may be on the economic disruption. The number of US cases is reaching records, and at least a couple of states are stopping their re-opening efforts. Several other countries, including parts of Australia, …
Investors Wrestle with Notion that More Covid Cases mean More Stimulus Read More »
Ironically, the pandemic and progress toward a vaccine will play second fiddle to more mundane concerns in the week ahead. Still, investors have shown that the most strained relationship between the US and China in 30 years (Tiananmen Square) is insufficient in the first instance to derail the recovery equity markets. Major benchmarks in the …
The US and UK markets were closed on Monday. Together they accounted for almost two-thirds of the turnover in the foreign exchange market. The dollar was narrowly mixed against the majors. The dollar bloc and sterling ticked a little higher, and the euro and yen were a touch heavier. The illiquidity seemed to weigh on …
We have learned that China, the world’s second-largest economy contracted by nearly 10% in Q1. The US has lost in less than two months all the jobs gained in the record expansion. The central bank of Canada, the 10th largest economy, warned that its output could fall by 30% in the first half. Europe’s automakers’ association …
Most of the financial centers in Europe and North America are closed today for the Good Friday holiday. Many markets in Europe will also be closed on Monday. Here is a summary of key developments. 1. Many markets in the Asia Pacific regions were also closed. Most that were open advanced, including Japan, Taiwan, South …
Eight Things to Know about Global Capital Markets on Good Friday Read More »
Overview: Three deals need to be struck. First, the Eurogroup of finance ministers needs to reach an agreement of proposals for joint action to the heads of state. Second, oil producers need to cut output if prices are to stabilize. Third, the US Congress needs to strike a deal to provide more funding. Investor seems …
I had the privilege to join Ben Lichtenstein at TD Ameritrade (from a remote location) this morning to talk about the global markets. I make four points. First, the reversal of the S&P 500 yesterday set the tone for Asia and Europe. Volatility throughout the capital markets remains elevated, even if off the peaks. Second, …