Australian Shares

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MS: Fire about to turn ice for stocks

Morgan Stanley with the note: Over the past few weeks, I have been highlighting the increasing probability of a colder winter but a later start than previously expected. In other words, our ‘fire and ice’ narrative remains intact, but timing of ice has been pushed out. Having said that, with inflation running hot in both

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Macro Morning

Wall Street put in another record high, but it was European stocks that flew the highest overnight despite a fall in German retail sales, while the latest US ISM manufacturing print surprised with its robustness. Bond markets were range traded with the 10 year Treasury flopping between the 1.5% and 1.6% levels while commodity markets

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Macro Afternoon

Asian stock markets are starting the new calendar month in a somewhat bullish fashion, as the end of month rebalancing and resetting of daylight savings on overseas markets is not holding back risk taking in the region. A comfortable win for the ruling party in Japan over the weekend has seen local shares surge as

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Macro Morning

Friday night saw a lot of unsettled trading on stock markets as the usual end of month window dressing transpired against the backdrop of more US corporate earnings and a surprise uplift in Eurozone inflation and 3Q GDP results. While Wall Street put in a new record high, European markets were held back by these

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Macro Afternoon

Asian stock markets are quite mixed as tech stock concerns on Wall Street and property debt in China continue to weigh on risk sentiment, let alone all the gyrations around bond markets and growing stagflation realities. Gold has been pushed below the $1800USD per ounce level again, while Bitcoin is desperately trying to get some

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Macro Morning

Wall Street yet again reversed risk sentiment overnight with big rallies across tech stocks, the latest GDP print coming in as expected and while the ECB meeting left knobs and dials in their current settings, but it was enough to see USD sold off wildly, with the Aussie dollar pulled along for the ride. Bond

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Macro Afternoon

Asian stock markets are all lower on poorer risk sentiment as concerns about inflation stemming from last night’s Bank of Canada move and stirring bond markets continue to grow. This is spilling over into sour sentiment for Eureopan and US stocks heading into the London open, while the USD is remaining relatively strong against the

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Macro Morning

A very late selloff on Wall Street reversed risk sentiment overnight with European markets also pulling back, denying a follow through on a mid week surge. The bond market is where all the action is with curve flattening and the 10 year US Treasury yields pulling back firmly, this time finishing just above the 1.5%

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Macro Afternoon

Asian stock markets are all lower on poorer risk sentiment as concerns about China’s property sector continue to grow. This is spilling over into sour sentiment for Eureopan and US stocks heading into the London open, while the USD is remaining relatively strong against the major currency pairs. Gold has slumped again, rejecting the overhead

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MS: Fire an ice equity correction approaches

Morgan Stanley is still making the most sense on Wall Street with daylight second: Over the past few weeks we have discussed the increasing probability for a colder winter but a later start than previously expected. In other words, our Fire and Ice narrative remains very much intact, but timing is a bit more uncertain

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Macro Morning

Last night saw equity markets twitch moods with European bourses surging while Wall Street treaded water in the wake of more tech earnings, and while the latter did put in new nominal highs, its was literally only a handful of points. The USD remained strong against Euro and Pound Sterling while commodity currencies were a

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Macro Morning

Last night saw Wall Street regain strength, particularly tech stocks, with the S&P500 putting in a new record high as concerns over the coming Fed taper dwindle once more. European and Asian markets were somewhat mixed, but are being dragged along for the ride with the USD keeping domestic currencies weak, with Euro dropping significantly

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Macro Afternoon

Asian stock markets are quite mixed with only local shares putting on any meaningful gains with Japanese shares losing ground in the face of a stronger Yen. Meanwhile the USD remains strong following Fed Chair Powell’s “time to taper” comments on Friday night with the Aussie weakening although gold is inching its way back above

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Macro Morning

Friday night saw Wall Street stand out as it fumbled over Fed Chair Powell’s hawkish comments over inflation. European and Asian markets however had solid finishes to the week, helped along by lower domestic currencies as USD strength continues to firm.  Commodity markets were still rather bullish as oil prices made a new seven year

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Macro Afternoon

Asian stock markets are holding on to minor gains following the news of a debt payment made by Evergrande crisis with risk currencies lifting after getting pummeled by USD overnight. Japanese shares are pushing the hardest on their latest inflation print, while gold is inching its wayback to the $1800USD per ounce level. Meanwhile Bitcoin

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UBS: Don’t go to RIO

UBS says don’t go to RIO: RIO’s new mgmt team set out its strategy to focus on operational performance, ESG credentials & growth, while rebuilding trust after Juukan Gorge. It aims to cut its Scope 1&2 emissions faster (-50% by 2030) at a cost of ~$7.5b. RIO pivots the business more towards growth in energy

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Macro Morning

Another mixed night on risk markets as Wall Street hits new record highs while European bourses stumbled around with minor losses as the USD reversed course and returned to strength. Commodity currencies took a small tumble as did Euro which returned to its start of week point with 10 year Treasury yields again spiking above

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Macro Afternoon

Asian stock markets are being weighed down by Chinese shares selling off in the wake of the Evergrande crisis with Japanese shares also down sharply. Currency markets are seeing a modest return to strength by the USD, although gold is itching higher trying to get back above the $1800USD per ounce level. Meanwhile Bitcoin has

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Macro Morning

A relatively mixed night on risk markets and while Wall Street continued its corporate earnings inspired rally, the US Dollar Index (DXY) fell back against the majors, with the Kiwi and Australian dollar doing the most heavy lifting. Meanwhile Treasury yields pulled back from their recent near six month high with the 10 year still

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Macro Afternoon

Asian stock markets are relatively mixed but bullish overall in response to the continued uptrend on Wall Street overnight, although concerns over Chinese energy supply and inflation continue to weigh with the latter to be brought to the fore with tonights dual European/non-European inflation prints.  Gold is trying to reclaim lost ground again, returning to

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The music has stopped but fundies keep dancing

The BofA monthly fundie survey says it all this month: Bottom line: least bullish survey since Oct’20; FMS cash levels jump to 12-month high as global growth expectations turn negative 1st time since Apr’20 on inflation & China pessimism; allocation to bonds slumps to all-time low, to stocks still very high (Chart 1). FMS on

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Macro Morning

A lack of economic releases or controversial Fed opinions through a spate of speeches overnight kept risk markets in line as While Wall Street continued to rally on solid corporate earnings results. The US Dollar Index (DXY) fell back against the majors, with Euro breaking out alongside the Aussie dollar while Treasury yields rose again

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Macro Afternoon

Asian stock markets are following the uptick in Wall Street with strong gains across the region as the USD loses significant ground against the major currencies, with the Australian dollar putting in a three month high on the back of the latest RBA Minutes. This is all essentially on technical breakouts as economic news is

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Macro Morning

While Wall Street continued to rally on solid corporate earnings results, European shares followed the wobbly Asian session with modest falls across the continent as inflation concerns continued to dominate. The US Dollar Index (DXY) was again unchanged, but Euro oscillated and commodity currencies pulled back slightly as the bond market also retreated as the

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Will fire or ice kill markets?

More to the point, does it matter?  BofA still thinks fire: The Biggest Picture: US small business labor shortages & wage pressures worst in 50years (Chart2) = we are on cusp of policy pivot from pro-growth to anti-inflation (policy mistake has already happened…>$30tn of global stimulus ending in inflation). The view: bull case is pandemic

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Macro Afternoon

Asian stock markets are starting the week in mixed fashion as the latest Chinese GDP print undershoots expectations. Currency markets are holding on to their Friday night wobbles as inflation expectations are still reverberating around risk markets as the November Fed taper starts to weigh on trader’s minds. Meanwhile Bitcoin has almost matched its previous

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Macro Morning

Yet another solid night of corporate earnings on Wall Street has kept risk appetites full with a fine finish to the trading week on Friday night. The USD actually finished even against the majors and commodity currencies, with the defensive Yen underperforming while Aussie and Euro ceased their rebound promptly. The bond market actually lifted

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Macro Afternoon

Asian stock markets are finishing the week on a high note with green across the board in response to the continued rebound on Wall Street overnight. The reversal in USD strength has also continued, save for Yen which is weakening alongside risk markets, while gold hovers just below the $1800USD per ounce level. Meanwhile Bitcoin

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Macro Morning

A solid night of corporate earnings with no surprises and a weaker USD has seen both Wall Street and European share markets continue their bounceback overnight, putting aside continuing concerns over inflation/stagflation. The USD remained weak against both the majors and commodity currencies, although the risk correlated USDJPY pair is stable indicating a strong tailwind