Overview: The S&P 500 and NASDAQ set new all-time highs yesterday, but the continued outperformance of US equities have failed to lend the dollar much support. It was sold to new lows for the year yesterday against the euro, sterling, the Swedish krona, and the Australian dollar. Asia Pacific equities were mixed. China, Taiwan, and …
US Equities Outperform but Does Little for the Heavy Greenback Read More »
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: The biggest rise in the US 10-year yield in a couple of months, as the record quarterly refunding, got underway may have helped stabilize the dollar after an earlier decline. The S&P 500 threatened to extend its advance for the eighth consecutive session yesterday, but a late sell-off stopped it cold after scaling to new …
Dollar was Sold in Asia and Europe, but is Poised to Bounce in North America Read More »
Overview: The new week has begun slowly with Singapore and Tokyo markets closed for national holidays. The MSCI Asia Pacific Index rose 2% last week and edged higher today, led by 1.5%-1.7% rallies in South Korea and Australia. Hong Kong was a notable exception and eased around 0.6%. Europe’s Dow Jones Stoxx 600 also advanced …
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: The drop in US yields to new lows amid paralysis in Washington, except apparently over a lip-syncing app’s threat to US national security, sent the dollar back to its lows after a modest recovery in early North American trading yesterday. The greenback remains under pressure today, falling against most of the world’s currencies. The …
Corrective Pressures in the FX Market Prove Short-Lived 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, …
The recent price action, and in particular, the sideways trend in many segments of the capital markets, reflects the challenge investors are having in separating the wheat from the chaff. The strong co-movement of risk assets has weakened. There is a lack of near-term visibility and contradictory signals, while the trends in place since March have …
Overview: Another late sell-off of US equities, ostensibly on questions over Moderna’s progress on a vaccine, failed to deter equity gains in the Asia Pacific region. China was a notable exception, but the MSCI Asia Pacific Index rose for the fourth consecutive session. European shares are little changed, but reflects a split. On the one hand, …
Fed Funds Futures No Longer Imply Negative Rates Read More »
Overview: The new week begins slowly in the capital markets. Many markets in the Asia Pacific region, including Japan, Hong Kong, and Australia, gained over 1%, but European and US shares are heavier. Benchmarks off all three regions rallied by 3.4%-3.5% over the past two weeks. Bond markets are also little changed, with the US 10-year …