The biggest day of the (economic) year: The Australian economy garnered significant attention yesterday. Arguably, it was the biggest day on the economic calendar we’ll see this year. Insights into both the future of monetary and fiscal policy don’t often come on the same day. But yesterday it did: the RBA delivered their monthly decision on Australian interest rates; and the Federal Government handed down its latest budget. The price action in financial markets has thus far been limited – thoug
Lyft, the most recent high profile IPO, shares have seen huge trading activity over the first two days of trading as over 41.5 million shares were traded, well over the 32.5 million offered in the IPO. However, the ride-hailing company saw it's shares slump 12% on its second day of trading down to $69.01, below the official IPO price of $72. The downturn comes after the stock rallied to a high of $88.60 on Friday.
US equities surged on Monday due to strong manufacturing data as factory ac
The US Yield Curve Flipped Back to Normal, Is the Recession Off?
A lot of attention was paid this past week by the financial media to the inversion of the yield curve. To understand the signal, it is important to define the circumstances. The yield curve is a comparison of the yield – in this case, on US Treasuries – of different durations. Normally, the longer the duration, the higher the yield should be owing to the longer tie-up of exposure. When a curve inverts, we have an atypical circ
Today was a good day: The term risk-on can be a little overused in financial markets at times. When short-on-time, and confronted with something complex, suggesting it’s been a “risk-on” or “risk-day” is a simple way to say market participants feel pretty good. At the risk of oversimplifying: the first day of the new quarter was certainly a “risk-on” day. It’s likely given the context of yesterday’s trade that makes this so. Concerns about a global economic slowdown have been their most sensitiv
Confidence returns to the markets as Asian stocks rallied on Monday over positive Chinese factory gauges and signs of progress in US-China trade talks boosted investor sentiment. Manufacturing activity in China expanded at its fastest pace in eight months in March, reading 50.8 and beating analysts' expectations of 49.9.
Bloomberg has announced that Chinese government bonds will be included in its Bloomberg Barclays Global Aggregate index, a global benchmark of government securities. This
The start of something new: A new day, week, month and quarter today; and what a difference a little time can make. 3 months ago, at least for some, global financial markets stood at the brink of ruin. It was December 24 last year that the S&P500 hit its low, but it wasn’t until the start of January that something resembling a turnaround in US stocks transpired. Fast forward to now, and Wall Street is over 12 per cent higher, and though at stages has looked extremely vulnerable to turnaround
Expected index adjustments
Please see the expected dividend adjustment figures for a number of our major indices for the week commencing 1 April 2019. If you have any queries or questions on this please let us know in the comments section below. For further information regarding dividend adjustments, and how they affect your positions, please take a look at the video.
NB: All dividend adjustments are forecasts and therefore speculative. A dividend adjustment is a cash neutral a
US-China trade talks have restarted in Beijing as U.S. Treasury Secretary Steven Mnuchin said on Friday that he had a "productive working dinner" the previous night. Investors are hopeful that progress will be made to resolve the bitter trade dispute between the two largest global economies, amid growing concern of a slowing economy as the bond market signals a possible incoming recession.
Theresa May is set to make a third attempt to pass a Brexit deal today, as the MPs are asked to vot
Relief-on? It’s a trifle difficult to describe last night’s trade simply. On the surface, risk assets are being reasonably well supported, and there are a few signals suggesting market participants are in a slightly more bullish state of mind. Rather than “risk-on” however, one might describe the last 12 hours in markets as “relief-on”. This is mostly due to the fact that, at least for now, the global bond market rally has stalled. Markets had worked themselves into a frenzy this week, fretting
As per the Bloomberg article, the market for Turkish Lira is in dislocation. Volatility in the Lira has posted the biggest four-day surge since 2004 as officials adopt measures to create a scarcity of the currency to prevent a slump in its value days before local elections this weekend.
The cost of borrowing Lira overnight on the swap market exceeded 1000% because local banks are under pressure to not provide liquidity to foreign investors who want to bet against the currency.
Gold prices edged higher after falling on Wednesday. Globally declining treasury yields could increase demand for the yellow-metal if a stock rout were to take place. Spot contracts hit $1311.54 at 6:00am GMT on the IG Web Trading Platform.
Palladium slumped 6% on Wednesday on concerns of slowing demand from the automotive and electronic appliances sectors. Slowing global growth could drown the metal, which hit a record $1620.52 last week.
Oil slumped on Wednesday on reports that
The see-sawing market: The one-day-up, one-day-down pattern of trade on Wall Street continues. It’s playing-out so elegantly, it’s almost absurd. Yesterday was a “down” day, as market participants evacuated equity markets to seek shelter in safe-haven government bonds. In contrast to the day prior, breadth has been universally low, with practically every sector in the S&P500 trading lower. The same simple binary that’s driven market activity for weeks is behind this dynamic: a competition be
A three-year legal battle has concluded with the EU enforcing stricter copyright laws that could affect the business models of tech giants like Google and Facebook. The new reform plans to protect artists and publishers whose work has been widely spread on the internet, by making the tech firms responsible for detecting and removing content that infringes copyright law. Google will has been very critical about the new reform saying that it will restrict freedom of expression, as its video-sharin
Broad-based based bounce in stocks: It was a buy the dip day yesterday, judging by price action in global risk-assets. As has been the theme this week, there wasn’t any meaningful macro-news to change market participants behavior. So: an explanation for the (almost) universally solid day for global equities ought to be chalked-up to internal market mechanics. What this may imply for the longer run is a touch obscure. This market is trading much in the way a plane rights-itself after some brief,
In the latest round of voting in the House of Commons, MP’s voted to set up a series of votes on Wednesday to see which approach to Brexit has the most support. Later, am amendment on whether another extension could be requested if no progress is made on a deal by the 5th of April.
European indices finished the main session down with the FTSE losing 0.42% and the DAX losing 0.15%, 17 points down from the previous day. Meanwhile, US indices traded relatively flat with less that 0.1% change
In the Aftermath of the Fed
The baton has been dropped. The Federal Reserve was by far the most aggressive major central bank through this past financial epoch (the last decade) to embrace ‘normalization’ of its monetary policy following its extraordinary infusion of support through rate cuts and quantitative easing (QE). Over the past three years, the central bank has raised its benchmark rate range 225 basis points and slowly began to reverse the tide of its enormous balance sheet. As of
Markets trade-off Friday overhang: Markets traded in something of a vacuum Monday. The themes driving price action were more-or-less those that had determined activity to end last week. The effects of this were pronounced in the Asian session, but much less so in Europe and North America. It stands to reason: Asian markets were still to digest Friday night’s abysmal European PMI figures. That data’s impact is still rippling through the market. Anxieties about global growth and the likelihood for
Shares in Asia fell more than 2% amid growing fears that a recession is on the horizon, Japan's Topix was impacted the most as the index dropped 2.5% at the close. The Hang Seng, ASX 200 and the Shanghai Composite followed and all fell by at least 1%.
Numerous reports over the weekend suggested that senior ministers were plotting to oust Theresa May as doing so could enhance support of her Brexit deal, although this has been denied. Mrs May is set to meet cabinet ministers today to update
Expected index adjustments
Please see the expected dividend adjustment figures for a number of our major indices for the week commencing 25 Mar 2019. If you have any queries or questions on this please let us know in the comments section below. For further information regarding dividend adjustments, and how they affect your positions, please take a look at the video.
NB: All dividend adjustments are forecasts and therefore speculative. A dividend adjustment is a cash neutral ad
Global growth the primary issue right now: The monumental tug-of war between improving financial conditions and deteriorating economic conditions continues. On Friday, it was the latter that took home the points, if only this time around. Both variables truly sit diametrically opposed, and as far as market participants are concerned, which force will prevail remains speculative. It’s written into the mixed-messages markets have been signalling in the last several weeks. It must be said, with the
EU agrees to postpone Brexit until 22 May if MPs approve a deal next week, otherwise the UK will leave by 12 April, a much shorter deadline
Levi Strauss shares rocket, with initial public offering above expectations at $17, and closing at $22.5
China to potentially miss out on $5.5trillion growth opportunity in digital trade if they do not build effort on data privacy and intellectual property protection issues
Uber to be listed on the New York Stock Exchange and is predicte
The EU has indicated that Theresa May needs to get backing from parliament on her Brexit deal before they agree to delay the UK's withdrawal from the EU. The Prime Minister is heading to Brussels today for the European Council meeting to try to force an extension in order to avoid a no-deal scenario.
US bank stocks traded lower yesterday after the Fed's announcement that there will be no rate hikes in 2019, Goldman was down 3.4% whilst BoA, J.P. Morgan Chase, Citigroup and Morgan Stanley
Market action proves it again: this market hinges on the Fed: The US Fed has proven itself as the most important game in town for traders. The FOMC met this morning, and lo-and-behold: the dovish Fed has proven more dovish than previously thought; the patient Fed has proven more patient that previously thought. Interest rates have remained on hold, but everyone knew that was to be the case today. It was about the dot-plots, the neutral-rate, the economic projections, and the balance sheet run-of
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