Thursday, 17 September 2015

A few macro thoughts today...

A few macro thoughts today...is anything happening?!

The Fed – 5 aspects to watch out for later when Janet Yellen speaks (link here). Meanwhile via @PredictedMkts I note that the 307 point (+1.9%) rally seen in the Dow so far this week marks the strongest start to a week since 4 February 2015, 32 weeks ago whilst the Citi Economic Surprise Index for the US is at two-month low and squarely back in negative territory


The great #Fed divide...

Hold - BNP, BarCap, Credit Sussie Deutsche Bank, GS, HSBC, MS

Hike - BofA, JPM, RBC, SocGen, UBS, Wells Fargo

...well I guess the challenge is that Janet Yellen has not said anything for a while...


...and, of course, times have changed a bit since the last rate rise!



Supply side and France – from today’s FT: ‘Francois Hollande is ramping up tax breaks and public spending cuts for France next year, cementing the Socialist president’s conversion to supply-side solutions as he seeks to rekindle growth in the eurozone’s second-largest economy’.  Goodness, supply-side mention and France! 

Note Switzerland have issued updated economic forecasts.  Growth got nibbled down for 2016 from 1.6%e to 1.5%e...well they are relying on help from continuing Eurozone growth! 

A key prerequisite for an improvement in the economic situation is that the global economy remains on an upward course and, in particular, that the Euro zone is able to continue its recovery.

UK wages – better...but is realistic underlying inflation really c. zero?  I think not...


Asia – markets currently up and pretty calm ahead of the Fed.  Japan downgraded by Standard & Poor's, but cut from AA- to A+ places its rating in line with Fitch and Moody's.  Meanwhile on China watch, chat yesterday that the country will offer tax breaks to autos/machinery firms to help encourage investment levels.  Also MS & CS have ceased offering synthetic short products under Shanghai-Hong Kong Stock Connect – cannot think why!

Still, better news for Japanese stocks...foreigners not liking is a positive in my experience! 


Emerging markets – a new high in the fear?  Emerging markets are facing something worse than even 1997… 

Finally, I do see value in gold as highlighted by this chart too in terms of the sheer longevity of the current bear market...

No comments:

Post a Comment