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
Global Markets Focus Making sense of the equity sell-off The recent sell-off both in emerging and developed equities has a wide range of drivers, including worries about Fed tapering and the perceived risks of a “hard landing” in China. Nonetheless, our... 4th February 2014 · 1 min read
Global Markets Focus Market implications of financial repression Financial repression - official policies that lower artificially a government's cost of borrowing - is likely to play an important ongoing role in liquidating high levels of public debt in advanced... 7th November 2013 · 1 min read
Global Markets Focus Is the underperformance of EM equities set to continue? One notable development this year has been the poor showing of emerging market equities, which have significantly underperformed developed market equities despite the absence of a major financial or... 4th July 2013 · 1 min read
Global Markets Focus Future monetary tightening and the prospects for US equities We doubt that the US stock market will fare well in the run-up to, and during the early stages of, the next tightening of monetary policy. Admittedly, this would buck the trend since 1970, when, on... 27th March 2013 · 1 min read
Global Markets Focus Market volatility set to rebound There are several possible explanations for the declines in volatility in financial markets over the last year or so. Some have argued that volatility has simply returned to historical norms. Others... 22nd March 2013 · 1 min read
Global Markets Focus Is a bubble forming in financial markets in the emerging world? The yield of the JP Morgan Emerging Market Bond Index Plus recently fell to its lowest ever level, while the annual average dollar-based return from the MSCI Emerging Market Index of equities has been... 8th February 2013 · 1 min read
Global Markets Focus What are the longer-term prospects for US equities and bonds? Bonds have generally fared much better the equities since the turn of the century. We do not expect this pattern to last. If we are right, this could have serious repercussions given the very... 7th December 2012 · 1 min read
Global Markets Focus Should shareholders be worried about the US fiscal cliff? We do not expect the result of the US elections to have a lasting impact on the stock market. Neither the tax hikes on investment income proposed by President Obama nor the tax cuts proposed by his... 8th November 2012 · 1 min read
