Global Markets Focus Are the best days over for EM financial markets? After a very strong run, EM bonds, equities and currencies have all faltered recently. Although they have since bounced back a bit, we think that their best days are now over. 22nd February 2018 · 1 min read
Global Markets Focus What does 2018 have in store for developed markets? We think that investors are still underestimating the extent to which the Fed will tighten policy next year. As a result, we forecast that the dollar and Treasury yields will rise in 2018. We don’t... 11th December 2017 · 1 min read
Global Markets Focus Will Corporate America shore up the Treasury market? Corporate America has been masquerading as a major “foreign” investor in US government bonds in recent years. This Focus considers whether its healthy appetite will continue and anchor Treasury yields... 4th October 2017 · 1 min read
Global Markets Focus How vulnerable are EM assets to tighter DM monetary policy? In our view, EM assets are likely to weather the gradual tightening of monetary policy in advanced economies this year and next. But the effects of this tightening may start to bite further ahead. 1st September 2017 · 1 min read
Global Markets Focus Does low volatility really spell trouble for the US stock market? There is a view that a big correction in the US stock market lies around the corner, because volatility is very low. This view has been influenced by the fact that volatility was very low before the... 22nd May 2017 · 1 min read
Global Markets Focus What do lower equilibrium interest rates mean for asset prices? It is often argued that asset prices have been driven up by exceptionally loose monetary policy and that they are bound to come crashing down once central banks start to raise real interest rates back... 31st October 2016 · 1 min read
Global Markets Focus A new equilibrium in the US stock market In our view, the equilibrium price/earnings ratio of the US stock market is now much higher than its long run average. Indeed, we think it is close to its current cyclically-adjusted level. If we are... 14th June 2016 · 1 min read
Global Markets Focus Which EM equity markets are set to shine? Time will tell if the recent rebound in emerging market (EM) equities was a turning point, but we remain cautiously optimistic that they will outperform those in the developed world in 2016/17. 24th February 2016 · 1 min read
Global Markets Focus Shifts in global savings and their implications for US Treasuries The unusual stability of long-term US Treasury yields during the last Fed tightening cycle between 2004 and 2006 has been attributed to a glut of global savings. We are not convinced by this... 12th November 2015 · 1 min read
Global Markets Focus Will lower profit margins derail the US stock market? A tenet of the bear case for US equities is that the aggregate profit margin of the US corporate sector is extremely high and that it will inevitably revert to its long-run average, thereby derailing... 2nd June 2015 · 1 min read
Global Markets Focus Is the bull market in US Treasuries over? US Treasuries have come under pressure recently amid signs that the labour market is on fire. But while we think the bull market in government bonds may be over, we expect only a slow grind higher in... 18th February 2015 · 1 min read
Global Markets Focus How will the outlook for monetary policy affect the markets? A tighter monetary policy of the Federal Reserve will potentially be the most important factor affecting the global financial markets next year. In this Focus, we consider the reactions we can expect... 19th December 2014 · 1 min read
Global Markets Focus Scotland’s independence and the UK’s financial markets If the Scottish people voted for independence next month, it would create a lot of uncertainty andprobably weaken investors’ appetite for Gilts, UK equities and sterling. Admittedly, the... 14th August 2014 · 1 min read
Global Markets Focus Stock market implications of Corporate America's internationalisation The reach of Corporate America has become increasingly global. One important consequence has been a secular rise in profitability, not only at US multinational companies (MNCs) which dominate the... 27th March 2014 · 1 min read
Global Markets Focus How will UK equities fare in 2014 and 2015? UK equities underperformed other major developed markets significantly in 2013 and have fared no better than their American and European counterparts since the start of the year. But we think this... 18th February 2014 · 1 min read
Global Markets Focus How does economic reform affect emerging market assets? The implementation of growth-enhancing and risk-reducing economic reforms provides long-run benefits to investors in emerging markets. But as the recent turbulence attests, other factors play a more... 14th February 2014 · 1 min read