Wednesday, 23 September 2015

A few macro and related thoughts today...

A few macro and related thoughts today...

Markets – Risk aversion rules. DAX futures finished Tuesday at the lowest closing level seen in the 180 sessions since Wednesday 7 January 2015, meanwhile Tuesday's 1.08 point rally was the 8th biggest gain seen in Bunds so far in 2015, and was the biggest rally for 49 sessions (via Predicted Markets). Asian markets weak impacted by Chinese data (below), Singapore into bear market territory

As for hopes of a US rate rise…


(Source: Bespoke Invest) 

China - Caixin/Markit's manufacturing purchasing managers' index for August sank to 47 in September from 47.3 last month, and below economists' hopes for an improvement to 47.5. It was the lowest level since April 2008. Almost all sub-components deteriorated.  The survey report conclusion noted ‘patience may be needed for policies designed to promote stabilization to demonstrate their effectiveness'


Meanwhile President Xi on tour in the US said will increase efforts to develop an open economy and will not backtrack on reform process...

Migrant crisis - EU interior ministers yesterday imposed a plan to relocate 120,000 refugees across the bloc, outvoting four eastern European countries strongly opposed to the scheme which caused some political issues.  Meanwhile the OECD suggest that the 700k migrants so far likely to rise to 1m+ by the end of the year

Europe elections – post Greek election stories that ‘Greek Banks' Recap Needs May Reach EUR 20 Bln’ (Kathimerini).  Meanwhile in Spain the Catalan debate ahead of the weekend vote continues.  Useful read here on the Catalan bond market (link here). 


Brazil - BRAZIL GOVT SAID TO CUT 2015 GDP EST. TO -2.4% FROM -1.5% PREV (link here).  Some of the metrics not looking great...


 Going to be an interesting day today given the volatility of yesterday and the Chinese data above.  

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