Capital Daily The Fed, the BoE & the outlook for DM government bonds The yields of 10-year government bond yields in the US and the UK have already more than reversed their initial falls following the Fed’s and the Bank of England’s policy announcements and we think... 5th May 2022 · 7 mins read
Capital Daily Warnings for the US equity market from 1994 The US equity market struggled to make much ground during the rapid rate hikes of 1994/95, and there is reason to think it might do worse this time around if the Federal Reserve continues to tighten... 4th May 2022 · 6 mins read
Capital Daily Why inflation could drag down stock market multiples further We don’t subscribe to the view that the current high level of inflation in the US justifies a very big drop in its stock market. Nonetheless, we do think its valuation looks a bit high even if... 3rd May 2022 · 6 mins read
Capital Daily Stagflation may prolong the woes of euro-zone financial markets The latest euro-zone economic data reinforce our view that the region is headed for a year of stagflation; against this backdrop we expect that euro-zone assets and the euro will struggle over the... 29th April 2022 · 8 mins read
Capital Daily What to make of the yen’s new lows We wouldn’t be surprised if the yen fell further against most major currencies but doubt this would give the country’s equity market a relative boost, in common-currency terms at least. 28th April 2022 · 7 mins read
Capital Daily We suspect US big tech will remain under pressure We think that there is plenty of scope for US “big tech” in general to stay under pressure, given the prospects for TIPS and the potential for future earnings to fall short of expectations. 27th April 2022 · 5 mins read
Capital Daily China’s restrictions add extra turbulence for global markets More inflation from supply chain pressures owing to lockdowns in China could make equity and bond markets more turbulent. 26th April 2022 · 6 mins read
Capital Daily We do not expect a swift rebound in US equities Although the further dip in the S&P 500 so far today means that it has now fallen by more than 11% since its high at the start of this year, we think that the index is unlikely to recover... 25th April 2022 · 5 mins read
Capital Daily Rising yields may not save financial sector equities Financial sector equities have sold off in line with the broader market over the past two days. And even if the 10-year US Treasury yields resume their rise as we suspect, that may not give as much of... 22nd April 2022 · 7 mins read
Capital Daily Euro-zone bond markets and the French election Even if incumbent President Macron wins France’s upcoming presidential election, we expect that the yields of French government bonds will rise further, and that the yield spreads of euro-zone... 21st April 2022 · 5 mins read
Capital Daily What to make of the yen’s drop and intervention chatter While it has stabilised today, the ~10% depreciation of the Japanese yen over the past month or so is extraordinary. With some policymakers now hinting at FX intervention to stem the currency’s slide... 20th April 2022 · 6 mins read
Capital Daily Two key market implications of China’s economic slowdown Growing evidence of slowing economic growth in China suggests to us that government bond yields there will continue to fall, and that the renminbi will – eventually – follow suit. 19th April 2022 · 5 mins read
Capital Daily Slightly dovish ECB unlikely to keep EZ bond yields from rising While the ECB sounded a bit more dovish than might have been expected at its meeting today, we still think that it will proceed with policy normalisation. This underpins our forecast for the yields of... 14th April 2022 · 7 mins read
Capital Daily RBNZ: A kiwi in a coalmine? While today’s 50bp policy rate hikes from the RBNZ and the Bank of Canada point to the aggressiveness of the global monetary tightening cycle now underway, the market reaction to their announcements... 13th April 2022 · 7 mins read
Capital Daily We think Treasury yields will rise again even as inflation eases While we think US inflation peaked in March, we still expect long-term Treasury yields to grind higher over the rest of 2022. 12th April 2022 · 5 mins read
Capital Daily Boost to US equities from earnings expectations may soon fade Even if the US earnings season – which gets underway this week – reveals decent growth in profits, we doubt that expectations for earnings will continue to be revised higher. This informs our forecast... 11th April 2022 · 6 mins read
