Global Markets Update Will earnings growth continue to buoy global equities? This year’s rally in global equities has been driven primarily by an increase in investors’ expectations for corporate earnings. In general, we expect earnings to continue to support equities in 2018. 16th October 2017 · 1 min read
Global Markets Update EM sovereign bonds likely to remain relatively resilient Although the yields of US Treasuries have rebounded recently, those of emerging market (EM) local currency sovereign bonds have typically increased by less. We suspect that this will continue as... 12th October 2017 · 1 min read
Global Markets Update Pull-back in EM equities and currencies unlikely to last We do not think that the recent dip in emerging market (EM) currencies and equities signals the start of a larger downturn in their fortunes. 29th September 2017 · 1 min read
Global Markets Update Will risky assets continue to shrug off the Fed? Risky asset markets took the Fed’s unexpectedly-hawkish tone on Wednesday in their stride. We think that they will remain resilient over the next year and a half or so, even though we forecast that... 21st September 2017 · 1 min read
Global Markets Update Some revisions to our key market forecasts We have revised some of our key market forecasts for currencies, bonds and equities, partly because we no longer expect the FOMC to raise its target range for the federal funds rate again this year. 13th September 2017 · 1 min read
Global Markets Update How big a threat to EM assets is the scaling back of QE? Although policymakers are unlikely to give very much away, Friday’s Jackson Hole speeches will still be scrutinised for any hints about the timing of ECB “tapering” and Fed balance sheet... 24th August 2017 · 1 min read
Global Markets Update We forecast a rebound in the German DAX We think that the prospects for German large-cap equities during the remainder of 2017 are quite bright, despite their pull-back over the past two months. Admittedly, we are revising down our end-year... 22nd August 2017 · 1 min read
Global Markets Update Fed, not China’s demand, to remain key driver of Treasuries Although China’s holdings of US Treasuries increased by more in June than in any other month in the past six years, we doubt that renewed Chinese buying of Treasuries will keep their yields low in the... 18th August 2017 · 1 min read
Global Markets Update Recent rise unlikely to mark the start of a surge in spreads Credit spreads have risen as tensions between the US and North Korea have flared up. But the increase has been small and they are still low. We think that a downturn in the US economy is a more likely... 16th August 2017 · 1 min read
Global Markets Update Will North Korea tensions continue to weigh on US equities? The recent escalation of tensions between the US and North Korea has weighed on the S&P 500. But provided that war is avoided, we doubt that this marks the start of a sustained downturn in the index. 11th August 2017 · 1 min read
Global Markets Update Are similarities with 2007 a cause for concern? Today is the tenth anniversary of the start of the global financial crisis (GFC), which triggered the worst recession since the Great Depression. Some are of the view that history may be about to... 9th August 2017 · 1 min read
Global Markets Update Will US corporate credit spreads stay low? US corporate credit spreads surged three years or so ago after falling to the levels that they have approached again recently. Nonetheless, we doubt that history is about to repeat itself. 24th July 2017 · 1 min read
Global Markets Update Low volatility doesn’t mean EM equities are bound to fall The volatility of the MSCI Emerging Markets (EM) Index has plunged, as the index has climbed steadily to an all-time high in local currency terms. But these developments need not inevitably unwind... 18th July 2017 · 1 min read
Global Markets Update Will euro-zone peripheral bonds shrug off ECB tapering? Government bond yields have risen recently by more in Germany than in some “peripheral” countries of the euro-zone. This has happened even though the sell-off in bonds has been caused by concerns that... 14th July 2017 · 1 min read
Global Markets Update Are US equities actually undervalued? It is two decades since the Fed compared the yields of US government bonds and equities in its semiannual report to Congress, the next instalment of which Janet Yellen will deliver tomorrow. A... 11th July 2017 · 1 min read
Global Markets Update How stretched is the valuation of emerging market equities? The price/earnings ratio of the MSCI Emerging Markets Index has increased to a level that is well above its long-run average. However, in our view, the valuation of the index is not especially high... 7th July 2017 · 1 min read
