The titans are out and they do not like what they see. First up, Ray Dalio: Politics is playing a bigger role in influencing the markets than is typical, and I (and others) am still trying to figure out where Donald Trump is taking us, especially as it regards trade and other wars. Besides prompting
DXY was pounded lower last night: AUD lifted but is at 2015 lows against EUR: It was mixed versus EMs: Gold firmed: Oil fell: Base metals were mixed: Big miners too: EM stocks took off: Junk rebounded: Treasuries were sold: Bunds too: US stocks roared off support. The EUR squashed European shares: The FT has
DXY was soft Friday night: AUD fell against everything: Gold was strong: Oil too: Base metals were hit: Big miners are toast: EM stocks sold: Worse, junk broke: Treasuries were bid: Bunds too: And stocks were flogged again: The problem is not as specific as trade wars, though that is a part of it. It is that
The Dastayari Afifar goes global, via Campus Reform: Several Republican lawmakers are backing a new bill that would further tighten the screws on Chinese “Confucius Institutes” in U.S. colleges and universities. The bill, S.2583, was introduced by Republican Senators Marco Rubio and Tom Cotton, and is intended to amend two laws in order to make it
By Leith van Onselen JP Morgan’s Joseph Lupton forecasts that the US economy will expand by 1.25% over the next two years thanks to President Donald Trump’s company tax cut package, but that the tax cuts could potentially lead to 1970s-style stagflation, noting that fiscal conditions in the US at present are similar to those
By Leith van Onselen CNBC has published an interesting report on the large number of Californians that are leaving the state due to crippling housing costs: Californians may still love the beautiful weather and beaches, but more and more they are fed up with the high housing costs and taxes and deciding to flee to
DXY was smacked last last night: And the Aussie flew: Gold roared back: Oil went vertical: Base metals firmed: Big miners too: EM stocks lifted: Junk too: Treasuries were bought at the short end: Bunds were stable: And stocks eased back: The Fed hiked: Information received since the Federal Open Market Committee met in January
Via WaPo: President Trump is preparing to impose a package of $60 billion in annual tariffs against China, following through on a long-time threat that he says will punish China for intellectual property infringement and create more American jobs. The tariff package, which Trump plans to unveil by Friday, was confirmed by four senior administration
Via the WSJ: President Donald Trump has offered Lawrence Kudlow the job as director of the National Economic Council and he accepted, making the economic commentator one of the president’s top economic advisers, Mr. Kudlow said in an interview. We’ve all watched Kudlow for years on CNBC spout his supply-side Reaganomics drivel. Calculated Risk records
DXY was stable Friday night: AUD ran wild as iron ore crashed. Go figure: Gold was stable: Oil took off as the US rig count eased slightly: Base metals rebounded: Big miners did too, weakly: EM stocks flew: Junk firmed: Treasuries were sold a little: Bunds too: Stocks went completely nuts: And here’s why. US
Via Calculated Risk: On Friday at 8:30 AM ET, the BLS will release the employment report for February. The consensus, according to Bloomberg, is for an increase of 205,000 non-farm payroll jobs in February (with a range of estimates between 152,000 to 230,000), and for the unemployment rate to decline to 4.0%. The BLS reported 200,000
DXY was up a little last night: AUD fell against DMs: But rose against EMs: Gold was hit: Oil fell: Dirt fell: Miners fell: EM stocks fell: Junk fell: Treasuries were stable: And bunds: Stocks gained a little: Stocks were helped by possible exceptions in Trump tariff war. Meanwhile, the US boom is warming up
As Cohn goes so Navarro rises, via Bloomberg: The Trump administration is considering clamping down on Chinese investments in the U.S. and imposing tariffs on a broad range of its imports to punish Beijing for its alleged theft of intellectual property, according to people familiar with the matter. The U.S. Trade Representative’s office last year
Via CNBC: DXY and S&P futures not happy:
Via the FT: US companies are on track this year to return a record $1tn to shareholders, as Donald Trump’s tax cuts prompt boards to boost buybacks and dividends at a faster rate than their capital expenditure, research and development budgets or wage bills. Goldman Sachs estimated in February that buybacks would jump by 23 per
The WSJ has some concern for a steepening climb in Libor interbank lending rates: Libor has been rising for the last two years as the Federal Reserve has tightened interest rates. But gains have accelerated in recent months, according to RBC Capital Markets strategist Michael Cloherty, because of changes to the U.S. tax code that have encouraged companies to reshuffle bond holdings.
DXY was soft Friday night: But AUD was even softer versus DMs: EMs were mixed: Gold firmed: And oil: Base metals were mixed: But big miners were hosed again: EM stocks were lower: Junk jumped: Treasuries were sold: Bunds were bought: Europe got smashed as the US fell early but the latter recovered manfully to
Policy error fears sank DXY last night: AUD was weak against EMs: Less so against EMs: Gold held on: Oil was weak again: Base metals too: And big miners: EM stocks eased: US junk was hit: Treasuries were bid: And bunds: As stocks took it in the neck: US data was strong as the ISM
DXY took off last night and that double bottom looks the goods: AUD fell against DMs: But could not outpace EMs down: Gold was thumped: Oil too: Base metals rolled: Big miners too: EM stocks were hammered: Junk eased: Treasuries fell and the curve flattened: Bunds too: Stocks got crunched: US data was good with
The main concern that I have with profit growth driven by tax cuts is that it doesn’t reflect true economic strength. So, while global earnings growth during reporting season looks impressive (Australia being the exception) I want to know what’s behind it: And margins: So, it is an interesting asset allocation decision: Markets are expensive, we
By Leith van Onselen American men in their prime have left the US labour force at an astonishing rate, according to a new report from the Federal Reserve Bank of Kansas City (FRBKC): The labor force participation rate for prime-age men (age 25 to 54) in the United States has declined dramatically since the 1960s,
By Leith van Onselen For years I have argued that markets where land supply is unresponsive (inelastic) – via planning constraints or geographical barriers – are far more prone to suffer from more expensive housing, higher house price volatility, and bigger boom and bust cycles than markets where land supply is relatively responsive (elastic) to
Cross-posted from Tim Duy: Fed speakers continue to reiterate that policy remains on a gradual path of tightening.So far, the inflation data and brightening economy has more emboldened their commitment to gradual rate hikes than a faster pace of hikes. What about fiscal policy? That train has left the station, but central bankers don’t seem too
The USD gave up some gains last night: AUD bounced: Gold modestly: Brent was stronger but still looks toppy: Base metals were mixed: Big miners rallied: EM stocks were stable: Junk too: Treasuries were bought: And Bunds: Stocks rallied modestly: Yields are clearly worrying stocks even thought the technical correction is over, from JPM: First, we
My brain hurts: US President Donald Trump suggested on Wednesday that arming teachers could help prevent massacres such as last week’s mass shooting at a Florida high school. Trump voiced support for the idea during an emotional White House meeting with students who survived the shooting and a parent whose child did not. “If you
Goldman says so: Marina Grushin: Welcome to the Top of Mind podcast. I’m Marina Grushin. Inflation worries and rising rates were among several factors that jolted equity markets out of complacency earlier this month. Yet equities have largely looked through last week’s upside surprise in core CPI, which increased at the fastest pace in 12
DXY mostly held up last night: AUD was universally weak: Gold firmed: Brent held on: Base metals were mixed: Big miners bounced: EM stocks too: And junk: US yields lifted and the curve steepened: Bunds went the other way: Stocks roared: Europe is slowing materially from tearaway speeds: Flash Eurozone PMI Composite Output Index(1) at
DXY bounced lats night and suddenly has a potential double-bottom in place: AUD was weak against DMs: And mixed against EMs: Gold was whacked: Oil too: Base metals rolled: Big miners got hosed: EM stocks too: And junk: Treasuries sold and curve flattened: Same for Bunds: European stocks rallied but US fell: Nothing much on
DXY was strong Friday night after hitting new lows. Could be a double-bottom. Or not: AUD was quite weak against DMs: And EMs: Gold fell: Oil rose: Despite the rising rig count: • Total US oil rigs saw another solid week, +7 to 798 • Horizontal oil rigs were up even better, +10 to 696
Via Moody’s: Declining Default Rate Offsets Drag of Higher Interest Rates Corporate bond yield spreads have been relatively steady throughout recent equity market tumult. Expectations of a declining high-yield default rate into early 2019 have anchored corporate yield spreads. Moody’s Default Research Group predicts that the U.S.’ high-yield default rate may drop from January 2018’s
