Filtered by Subscriptions: Bonds & Equities Use setting Bonds & Equities
The outcome of forthcoming elections in the US is unlikely to have a major bearing on the performance of its stock market, if history is a useful guide. Economics will matter more than politics. … Economics, not elections, the key to US equity …
26th September 2016
This report is only available as a PDF. Click to download. … How will politics in the US affect its stock market? …
This report is only available as a PDF. Click to download. … OPEC output freeze agreement likely to prove elusive …
23rd September 2016
This report is only available as a PDF. Click to download. … US Treasury yields still likely to climb, as the Fed tightens policy …
22nd September 2016
Rather than loosen policy outright on Wednesday, the Bank of Japan (BoJ) made changes to its existing policy framework, some of which are designed to lessen side effects on the financial sector. It is therefore not surprising that the yen has …
21st September 2016
This report is only available as a PDF. Click to download. … What to make of the BoJ’s recalibration of monetary policy …
An increasing number of frontier markets are turning to the international bond markets as they look to paper over the cracks in their finances. Argentina got the ball rolling earlier this year when it sold US$16.5bn of dollar bonds, the largest amount …
The stripped spreads of dollar-denominated government bonds in Asia are nearing the lows seen prior to both the Asian and Global Financial Crises, but we do not think this signals that another major sell-off is just around the corner. … Should we be …
20th September 2016
This report is only available as a PDF. Click to download. … How will BoJ and Fed policy affect the markets? …
This report is only available as a PDF. Click to download. … UK macroprudential policy is set to support credit supply …
19th September 2016
This report is only available as a PDF. Click to download. … Are OIS rates a poor guide to US monetary policy? …
16th September 2016
US overnight indexed swap (OIS) rates have been driven down by a confluence of factors, some of which are unrelated to expectations for conventional monetary policy. As a result, caution should be exercised when using them to infer the expected path of …
This report is only available as a PDF. Click to download. … What next for EM currencies? …
15th September 2016
Emerging market (EM) equities have fallen in recent weeks as investors’ reacted to mixed signals from FOMC members regarding the outlook for monetary policy in the US. … EM equities under fire, as attention turns back to …
This report is only available as a PDF. Click to download. … BoJ policy easing is likely to keep a lid on long-dated JGB yields …
14th September 2016
Although the valuations of many assets are higher than their long-run averages, we don’t think sharp falls in their prices are likely. This is because we believe their equilibrium valuations have risen. In our view, the proximate cause of higher …
13th September 2016
This report is only available as a PDF. Click to download. … What are the market implications of lower real interest rates? …
Although the valuations of bonds and equities are higher than their long-run averages, we don’t think sharp falls in their prices are likely. This is because we believe their equilibrium valuations have risen. … Making sense of higher asset …
This report is only available as a PDF. Click to download. … Too soon to call the turn in global monetary policy …
12th September 2016
We have warned for some time that emerging market (EM) equities will be more volatile as attention turns back to the Fed. Momentum may yet drive stocks lower in the near term, but we continue to expect EM equities to perform reasonably well in the next …
This report is only available as a PDF. Click to download. … What next for sterling and gilts? …
9th September 2016
Yet another scaling back of investors’ expectations about Fed policy has breathed new life into the rally in emerging market (EM) “junk” bonds. But we suspect that the best days are now behind them, and would not be surprised to see the recent rally go …
This report is only available as a PDF. Click to download. … ECB holds off for now, but more easing still likely this year …
8th September 2016
Overly pessimistic projections for earnings of emerging market (EM) corporations mean that the price/12month forward earnings ratios of equity markets appear to be artificially high. Admittedly, EM stock markets are likely to be more volatile as investors …
This report is only available as a PDF. Click to download. … What to make of a possible swing towards fiscal stimulus? …
7th September 2016
With monetary stimulus approaching its limits, fiscal stimulus could soon become more fashionable. What would be the effect of such a shift in the policy mix on bonds, currencies and equities? … Market implications of a possible shift in the policy …
This report is only available as a PDF. Click to download. … Why we doubt US credit spreads will rise when the Fed tightens …
6th September 2016
This report is only available as a PDF. Click to download. … US Treasuries still vulnerable to waning demand from foreigners …
5th September 2016
This report is only available as a PDF. Click to download. … More of the same from the US labour market …
2nd September 2016
Although a lack of volatility in the US stock market has often given way to amajor correction, we don’t interpret the recent low level of the VIX index as asign that equity prices are about to plummet. … Are US equities set for a rougher …
1st September 2016
This report is only available as a PDF. Click to download. … Why EM investors don’t seem to care about China any more …
This report is only available as a PDF. Click to download. … Will the dollar’s rebound be short-lived? …
31st August 2016
The rally in emerging market (EM) equities has fizzled out and, with measures of valuations such as the price/12month forward earnings ratio high, there may be only limited upside in the near term. But high valuations are not necessarily a sign of …
The low level of the VIX index has led some to conclude that investors are being complacent about the risk of a major correction in the S&P 500. However, the fact that expected volatility is low by the standards of the past need not imply that a bear …
This report is only available as a PDF. Click to download. … Should we be worried about the low level of the VIX? …
30th August 2016
Non-commercial participants, sometimes described as “speculators”, are now running a record number of short positions in the pound against the dollar, according to US data. However, this alone does not mean that sterling is likely to fall further. For a …
This report is only available as a PDF. Click to download. … Markets shrug off Yellen’s warning of stronger case for tightening …
26th August 2016
This report is only available as a PDF. Click to download. … Jackson Hole likely to focus on longer-term issues …
25th August 2016
Political tensions have re-emerged in a number of frontier market economies in recent weeks, casting a shadow over the economic outlook. The outcome of the recent presidential election in Zambia has been disputed in court by the opposition, resulting in a …
This report is only available as a PDF. Click to download. … Will EM equities find support from lower bond yields? …
24th August 2016
We continue to expect emerging market (EM) equities to rise further in the next couple of years, even as the Fed tightens monetary policy. But the rally has fizzled out in recent days, and we suspect that equities will be more volatile ahead of upcoming …
This report is only available as a PDF. Click to download. … Is this the end of the road for EM equities? …
23rd August 2016
China’s currency continues to weaken and has now fallen by around 7% on a trade-weighted basis this year. But while past episodes of renminbi (RMB) depreciation have rattled global markets, they have taken the latest declines in their stride. We think …
This report is only available as a PDF. Click to download. … Has Brexit “Armageddon” been avoided? …
22nd August 2016
In the last few days there has been a lively debate in the UK media over whether Brexit ‘Armageddon’ has been avoided. Our view is that it is far too early to say for sure and that sterling in particular is still vulnerable to a further reassessment of …
This report is only available as a PDF. Click to download. … What’s behind the rally in oil prices? …
19th August 2016
The term premiums of US government bonds – the parts of their yields that do not capture expectations for short-term interest rates – are unusually low. Indeed, according to the estimates of some Fed staffers, the term premium of 10-year Treasuries is …
This report is only available as a PDF. Click to download. … What’s behind the renewed slide in the US dollar? …
18th August 2016
This report is only available as a PDF. Click to download. … Is the yen finally topping out? …
17th August 2016
A sharp increase in the cost of hedging has diminished the appeal of Treasuries to many foreign investors, especially those whose funds are denominated in yen and euros. This is potentially significant because the yields of US government bonds have …
16th August 2016
