Global Markets Update Longer-dated Bund yields to rise as ECB diversifies purchases After failing to live up to its own hype last week, we would not be surprised if the ECB is forced to increase its monthly asset purchases after all next year. But even if it does, we think that the... 11th December 2015 · 1 min read
Global Markets Update Are we wrong on EM equities? The renewed slump in emerging market (EM) equities perhaps calls into question our view that they will perform well in 2016/17. But the latest declines have been driven by a fall in commodity prices... 8th December 2015 · 1 min read
Global Markets Update US Treasuries remain exposed to tighter Fed policy Today’s US Employment Report bolsters our view that the future stance of Fed policy will put upward pressure on Treasury yields over the next couple of years. 4th December 2015 · 1 min read
Global Markets Update What’s in store for US high-yield corporate bonds? US high-yield corporate bonds have performed poorly in November amid concerns over the renewed fall in commodity prices and the prospect of tighter US monetary policy. Looking ahead, we do not think... 25th November 2015 · 1 min read
Global Markets Update Dollar strength unlikely to alter outlooks for monetary policy Being long of the dollar is reportedly one of the most crowded trades in the market. However, we stillthink that the US currency has further to climb against other majors. Indeed, we now expect the... 25th November 2015 · 1 min read
Global Markets Update Why the US stock market is not hugely overvalued Some claim that the US stock market is heading for a collapse because they assume that its price/earnings ratio will inevitably plummet to its long-run average. This assumption is wrong if, as seems... 25th November 2015 · 1 min read
Global Markets Update Much more to EM currencies than interest rate differentials Unlike in developed markets, interest rate differentials are not a particularly good guide to currency movements in emerging markets (EMs). Accordingly, while there will be bumps in the road, we do... 25th November 2015 · 1 min read
Global Economics Update Four key charts on the commodities “rout” (and the BDI) This Update aims to provide some perspective on the recent slides in oil and copper prices and the new record lows for the Baltic Dry Index of global shipping costs. It includes a more positive view... 20th November 2015 · 1 min read
Global Markets Update Rally shows EM markets can withstand Fed tightening The positive reaction by investors to the minutes from October’s FOMC meeting supports our view that emerging markets (EM) will fare relatively well in 2016/17 as US interest rates are raised. We... 19th November 2015 · 1 min read
Global Markets Update How will US equities and government bonds fare? US equities have fared better than US Treasuries in 2015. We suspect that this will remain the case over the next couple of years, as the Fed tightens monetary policy. Nonetheless, the longer-term... 19th November 2015 · 1 min read
Global Markets Update Is the worst now over for the major commodity currencies? The dollars of Australia, New Zealand and Canada have come under fire again, as the prices of the commodities that they export have dropped back. We think these prices are likely to recover a little... 17th November 2015 · 1 min read
Global Markets Update Are Spanish government bonds fairly priced? Spain has been one of the stand-out economies in the euro-zone this year. However, the recent political developments in Catalonia and Portugal are a source of concern and opinion polls suggest that... 13th November 2015 · 1 min read
Global Markets Update What's in store for the UK stock market? The UK stock market has performed poorly on an absolute and relative basis in 2015, dragged down by sharp falls in the basic materials and oil & gas sectors. These two sectors account for around one... 10th November 2015 · 1 min read
Global Markets Update Will US equities remain out of favour? Since the end of the last recession, there has been an almost interrupted net outflow from US mutual funds that invest in domestic equities. This partly reflects investors’ growing preference for... 9th November 2015 · 1 min read
Global Markets Update Markets look set to take first Fed rate hike in their stride The relatively calm reactions to Friday’s strong US employment report support our view that the gradual return of US interest rates towards more normal levels is unlikely to be the seismic shock that... 9th November 2015 · 1 min read
Global Markets Update Valuations suggest prospects brighter for EM than DM equities The valuation of emerging market (EM) equities relative to those in the developed world is the lowest it has been in recent memory. All else equal, this ought to lead to superior returns over the... 5th November 2015 · 1 min read
