Global Markets Update Rate differentials unlikely to buoy the dollar for long The relationships between the dollar’s value against other “majors” and the gaps between expected interest rates in the US and those elsewhere appear to be re-establishing themselves. This has been... 30th April 2018 · 1 min read
Global Markets Update EM currency rally not likely to resume any time soon The recent slumps in three widely-traded emerging market (EM) currencies – the Russian ruble, Turkish lira and Brazilian real – have all partly reversed since last week. But the bigger picture is that... 20th April 2018 · 1 min read
Global Markets Update 10-year US Treasury yield unlikely to have peaked yet The 10-year US Treasury yield fell from a four-year high of almost 3.0% in late February to only around 2.7% in early April, leading to claims that it had now peaked in this cycle. Yet the yield has... 16th April 2018 · 1 min read
Global Markets Update Why isn’t a stronger pound undermining the FTSE? The FTSE 100 has edged higher over the past month, despite a 5% drop in the S&P 500 and an appreciation of sterling against the dollar. A rise in the exchange rate has typically seen the US index... 12th April 2018 · 1 min read
Global Markets Update Will Bitcoin keep moving with risky assets? Bitcoin’s correlation with equity prices has strengthened recently, but we think that this will be just temporary. We still think that Bitcoin is essentially worthless, meaning that it is likely to... 5th April 2018 · 1 min read
Global Markets Update The likely consequences of escalating trade tensions Aside from equities in the US and China, those in Korea, Taiwan and South Africa appear particularly exposed to a further deterioration in Sino-American trade relations. And IT, consumer discretionary... 4th April 2018 · 1 min read
Global Markets Update Are the IT sector’s best days behind it? After outperforming for much of the past year or so, the IT sector has led the falls in stock markets in the past couple of weeks. Is a sustained period of underperformance now likely? 29th March 2018 · 1 min read
Global Markets Update Will EM credit spreads continue to rise? The spreads of emerging market (EM) sovereign dollar bonds have been edging up since their lows a couple of months ago, and we think that they have further to rise over the next two years. 22nd March 2018 · 1 min read
Global Markets Update S&P 500’s valuation is unlikely to cause its demise We think that the outlook for the US stock market is bleak. But unlike some who share this opinion, our pessimism is not rooted in a belief that the market is grossly overvalued and will inevitably... 14th March 2018 · 1 min read
Global Markets Update How vulnerable is the S&P 500 to rising interest rates? The S&P 500 has tended to hold up well in the past when the Fed has tightened policy. But it has slid once the tightening has begun to take a toll on the economy. With this in mind, we don’t expect... 12th March 2018 · 1 min read
Global Markets Update How would more protectionism affect the dollar? The reaction in currency markets to President Trump’s proposed tariffs on steel and aluminium suggests that investors are far more concerned that the duties represent the opening salvo of a trade war... 6th March 2018 · 1 min read
Global Markets Update Will politics put an end to the rally in Brazil’s equities? Brazil’s stock market has been the best-performing of any major economy this year, soaring by well over 10% despite the turmoil in global equities a few weeks ago. But we suspect that it will come... 1st March 2018 · 1 min read
Global Markets Update Looser fiscal policy spells more trouble for Treasuries The deal done in Congress at the beginning of this month will potentially result in even larger federal budget deficits than those seen during Ronald Reagan’s time as president. This is a key reason... 27th February 2018 · 1 min read
Global Markets Update Will the US-led recovery in global equity markets last? The US initially led the recovery in stock markets around the world from their falls of a few weeks ago. But the S&P 500 faltered a bit earlier this week, and we doubt that it will drive global... 21st February 2018 · 1 min read
Global Markets Update No swan song for the dollar We are abandoning our expectation that the dollar will have a last hurrah this year. We had previously expected it to stage a modest rebound against most other developed market currencies, as the... 8th February 2018 · 1 min read
Global Markets Update Sell-off underlines markets’ previous complacency The severity of any further sell-off in global financial markets may be limited by the general health of the global economy and the scope for policymakers to respond if necessary. Nonetheless, the... 6th February 2018 · 1 min read
