On the week we learnt that the UK and Japan are in a technical recession, although this meant little to markets and perhaps the bigger issue in Japan was the steady stream of pushback from key Japanese officials on recent JPY strength.
US retail sales fell 0.80% in Jan, a sinister turn when both US CPI and PPI were far hotter than expected, putting us on notice...
Whether trading equity, equity indices or even FX, Nvidia’s Q424 earnings (due after-market on 21 Feb) should be firmly on the risk radar. Markets could come alive with movement and traders may need to dynamically react.
How the Nvidia share price reacts immediately after its earnings results and CEO Jensen Huang’s guidance could have far-reaching implications -...
London is cold, wet, and grey at present – rather typical of your average British winter. I hope, then, that you’ll forgive me for looking ahead to the brighter summer months, particularly as financial markets are beginning to do the same.
Even after a hotter-than-expected January US CPI report, money markets continue to price a ‘summer of rate cuts’. Though...
As markets continue to digest the surprisingly hot January US CPI report, the question at the forefront of participants’ minds, at least in the FX space, is whether this can be the spark that ignites the next leg higher in the USD’s rally, as a plethora of factors continue to point to further gains lying ahead.
For context, as is at this point well-documented,...
The eagerly-anticipated January US CPI report delivered a rather nasty surprise for policymakers, and riskier assets, with data printing hotter-than-expected across the board, sparking a knee-jerk hawkish repricing, as markets pushed back expectations of the first Fed cut into June.
Headline CPI rose 3.1% YoY in January, down from the 3.4% pace seen at the tail...
As a quieter week, lacking in major data or news catalysts, draws to a close, market participants look forward to a busier calendar of risk events over coming days, with focus falling primarily on the all-important January US CPI figures, in addition to a packed slate of UK economic releases, and a plethora of central bank speakers stepping up to the microphone.
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It’s been said may times now that the UK equity market is ‘cheap’ – in fact, getting a pound for every time that description is used in a research note may well result in better performance than the market itself has recently been able to achieve. Being ‘cheap’, however, is not reason enough to assume that the London market’s fortunes may soon turnaround, as this...
The equity story of last year was undoubtedly the stellar performance of the ‘magnificent seven’ – a handful of megacap tech stocks which reigned supreme over the vast majority of others, and drove the bulk of the broader market’s strong returns. As 2024 gets underway, however, signs are starting to emerge that this year’s dynamic may look rather different, both...
Inflation, naturally, remains the topic at the forefront of the minds of both market participants and policymakers alike. As price pressures continue to fade, and the majority of developed economies enter the ‘last mile’ of prices returning to target, whether the immaculate disinflation seen to date can continue, or whether the inflationary beast may yet still...
The greenback’s recent rally shows few signs of slowing soon, with the USD printing new YTD highs against a basket of peers, fuelled by a continued hawkish reassessment of Fed policy expectations, and a handful of chunky upside economic surprises. All in all, the ‘path of least resistance’ seems likely to continue to lead higher for the buck over the short- and...
Much focus remains on the Chinese equity space, with major indices having recently printed multi-year lows, as stocks have continued to slump amid ongoing disappointment over the lack of significant fiscal stimulus to attempt to breathe some life into the ailing economy. Many, however, are now wondering whether a catalyst may have emerged to reverse the market’s...
With US 10-year real rates pushing higher into 1.90% and rate cut expectations being priced out of the US interest rate and swap curve, and with the USD breaking out, gold longs should be enthused by the yellow metals inability to roll over and head into $2000. The ability to absorb several traditional negative catalysts suggests there are big counterweights in...
As US economic data continues to come in above expectations and Fed chatter pushes back on imminent rate hikes, we see the yield premium that US Treasury’s hold over German debt blowing out. For example, the yield premium to hold US2yr Treasuries over 2yr German bonds has pushed to 185bp (or 1.85%), having been at 154bp in mid-Jan. This is putting a bid into the...
The downside break of the 1.2800 to 1.2600 range the pair has held since 14 Dec has been well traded by clients. Looking at the current skew in open interest, traders see a higher risk of a move back to the breakout point, with 71% of open positions currently held long. I see the risk of modest short covering through late Asia but would take the timeframe in and...
