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German Banking Giants Announce Formal Merger Talks - EMEA Brief 18 Mar

Deutsche Bank and Commerzbank have announced formal merger talks which could result in the combined bank holding one fifth of Germany's High Street banking business.  Asian shares rose despite reported potential push back of agreement to end trade war. The Hang Seng gained 1%, the Shanghai Composite surged 2.3% and Japan's Nikkei climbed 0.6%.  Trump's weekend tweets ramped up the pressure on General Motors to reopen Ohio manufacturing plant which recent's closure cut 1,700 jobs. 

MichaelaIG

MichaelaIG

Lunar New Year market hours

Dear IG community,  There will be some changes to some of our Asian markets over the upcoming Lunar New Year, starting Monday 4 Feb. We will continue to make out of hours index prices throughout any breaks (excluding Taiwan and Malaysia). See the table below for the relevant information.

MaxIG

MaxIG

Yield curves and recessions; starting the second quarter; we've officially passed the original Brexit date - DailyFX Key Themes

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

JohnDFX

JohnDFX

President’s Day: APAC brief 18 Feb

President’s Day: It’s Trump’s market – and we are all just trading in it. It’s perhaps for some – especially market-purists – the uncomfortable reality that, as far as short-term movements and sentiment goes, US President Trump and his policy making is the greatest determinant of the current macro-economic outlook. It cuts in both directions, and certainly the US President is just as prone to deflating the market as he is to inflate it. But almost by his own admission, Trump’s modus operandi is

MaxIG

MaxIG

APAC brief - 21 Mar

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

MaxIG

MaxIG

Asian Markets Off 7-Month Peak - EMEA Brief 08 Apr

Asian Pacific markets were mixed on afternoon trading, edging off seven-month peaks as investors digested a rebound in U.S. jobs data and reports of more progress in the trade negotiations between Washington and Beijing, but still cautious on the outlook of the global economy and the U.S. earnings season.  The U.S economy added 196,000 jobs in March, beating economists' expectations of a figure of 175,000.  Chinese blue chip stocks climbed in the initial session, however slipped sl

JoeIG

JoeIG

Chinese Growth Lowest in 28 Years - EMEA Brief 21 Jan

Chinese growth has officially fallen to its slowest in 28 years. Fourth quarter figures have been announced which confirm analysts’ expectations that growth would be 6.4%, averaging 6.6% for the year. The US shutdown has now entered its 30th day. Trump offered protections for ‘Dreamers’ in an attempt to negotiate but this was quickly rejected by democrats as inadequate. Analysts now believe the shutdown will cause a 0.25% reduction in growth figures for the first quarter of 2019. J

IGAaronC

IGAaronC

Trump stokes trade wars; side effects of economic wars; central banks strain credibility - DailyFX Key Themes

Another Massive Escalation of the US-China Trade Wars The White House continues to double down on its aggressive posturing against China in a bid to force the county to yield to its demands at the negotiation table. This approach follows a few patterns in economics, sociology and debate whereby the commitment to escalation persists despite growing risks and diminishing return when or if a compromise is struck – such as the ‘escalation of commitment’ behavior. Late this past week, President

JohnDFX

JohnDFX

APAC brief 19 Mar

Markets trade thin ahead of central bank risks: It’s said that money makes the world go around. And given central bankers control the money of the world, it is they who decide when the turning starts and stops. Described this way, central bankers role in the economy sounds Bond-villain-esque. That’s entirely unfair of course – only fringe-dwellers would suggest they are so malevolent. But recent history, based on experiential evidence, suggests that when it comes to financial markets, the action

MaxIG

MaxIG

Positioning for the week’s climax - APAC brief 4 April

Positioning for the week’s climax: A little water-treading, as all eyes turn to Washington this weekend. And for two-reasons, really: highly anticipated trade-talks between the Trump Administration and Chinese officials – which includes Vice Premier Liu He; and the release of US Non-Farm Payrolls data by the US Bureau of Labor Statistics. Both promise to be potentially market moving events. Fundamentally, both events come in one-and-two as the week’s most significant macro-economic stories. How

MaxIG

MaxIG

APAC brief 20 Mar

Another trade-war headline downs sentiment: There’s some news floating through the wires that sentiment has taken a hit overnight courtesy of some unfavourable trade-war headlines. It’s been reported that Chinese officials aren’t co-operating with their US counterparts, as it applies to certain sensitive elements of trade-negotiations. The S&P500, which had been developing some intraday momentum prior to the release, has retraced throughout trade, consequent to the news. It’s closed flat for

MaxIG

MaxIG

Growth vs monetary policy; top thematic catalysts; December trading Conditions - DailyFX Key Themes

What Matters More to Risk: Healthy Growth or More Stimulus?  This seems like it would be a simple question to answer from a textbook perspective; but if you’ve been active in your investment these past years, reality has clearly deviated from the theoretical. We have seen economic activity the world over progressively struggle for traction. This is not a question of interpretation or the reliability of the signals being triggered. There have been far too many realized indications of strain

JohnDFX

JohnDFX

A “Goldilocks” end to the week: APAC brief - 8 Arpil

A “Goldilocks” end to the week: Sentiment was nicely boosted to end the week last week. US Non-Farm Payrolls printed as closely to a so-called "goldilocks" figure for risk assets as you're ever liked to see. The data revealed the US economy added 196,000 jobs last month, against an expected figure of 172,000. It was enough to keep the unemployment rate to its very low levels of 3.8 per cent. But the real kicker for market-bulls was the earnings component: wage growth missed estimates, revealing

MaxIG

MaxIG

Trade war end and recession; central bank testimony; another Brexit milestone - DailyFX Key Themes

Pricing in Trade Wars Versus Pricing in Recession Risks Investors are starting to see a path form for the United States and China to find a way out of their economically and financially-damaging trade war. After months of little more than a few words of optimism from only one side of the table – which was frequently reversed only days later – we are starting to see conviction from high level officials on both the American and Chinese sides. This past week was the most encouraging period for

JohnDFX

JohnDFX

Prolonged trade truce - APAC bried 26 Feb

Trump-Tweet #1: US President Trump announced yesterday what had long been assumed: the trade-truce will be delayed, because of the “very productive talks” going on between his administration and Chinese policymakers. Understandably, the formal recognition that tariffs won’t be hiked to 25 per cent (from their current rate of 10 per cent) on $US200bn of Chinese goods stoked risk sentiment. The overall impact wasn’t quite as deep and broad on one might have hoped, however. The reasoning is logical

MaxIG

MaxIG

APAC brief 25 Mar

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

MaxIG

MaxIG

APAC brief - 27 Mar

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,

MaxIG

MaxIG

Luxury leather or Yellow Vest? - EMEA Brief 20 Mar

Gold prices edged lower as the yellow metal’s rally might be over. Spot contracts hit $1306 at 6:00am GMT on the IG Web Trading Platform. The safe-haven appeal of the gold bullion seems to fade as investors get more bullish on a possibly incumbent US-China trade deal. However, according to Goldman Sachs the combination of a pause in interest rate hikes by the Federal Reserve and more robust growth in emerging markets could weaken the US dollar and support the gold price. As palladium hit

IG-Andi

IG-Andi

APAC brief - 9 April

An uneventful day on Wall Street: A flat, somewhat mixed, and low activity day on Wall Street, market participants seem to be eyeing events later on in the week. After Friday’s Non-Farm Payroll induced rally, traders have apparently looked-down below their feet, realized how far this market has climbed, and decided a fresh-wind is required before scaling to new record-heights. Such a milestone stands only 1-and-a-half per cent away for the S&P500; and sensibly, the market is in no rush to ge

MaxIG

MaxIG

Spread of trade wars; Dovish monetary policy; Dollar offsetting influences - DailyFX Key Themes

Don’t Forget Trade Wars Aren’t Isolated to US-China Trade wars remain my greatest concern for the health of the global markets and economy. There have been threats in the past where a localized fundamental virus has turned contagious to the rest of the world by unforeseen circumstances – such as the Great Financial Crisis whereby a US subprime housing derivative implosion infected the wider financial markets by destabilized a foundation built on excess leverage throughout the system. When i

JohnDFX

JohnDFX

Technical and fundamental bearish bias; ECB edges up currency wars; UK's next Brexit votes

Fed Sets the Tone for Global Monetary Policy Expectations Global monetary policy trends have shifted towards a more accommodative stance as forecasts for economic activity have stuttered and worries of ‘external risks’ have gained traction. This has sharpened the relative value of currencies as market dig into the grey areas trying to determine which groups are taking greater strides to loosen than their peers. However, it is crucial that all investors – no matter your preferred market nor

JohnDFX

JohnDFX

US trade showed greater equanimity: APAC brief - 7 May

A rocky start to the week: The first day of the week’s trade can be reasonably said to have ended – and it was a tumultuous one. US President Trump’s tweeting of new tariffs on the Chinese economy sparked a level volatility not experienced in the financial markets for several months. It certainly had the effect of waking some (perhaps) complacent market participants from their slumber. And although the panic has abated somewhat, sentiment has been dented again this morning, after an announcement

MaxIG

MaxIG

Data overload; FOMC and extreme monetary policy; Brexit election vs deadline - DailyFX Key Themes

Market Conditions in Data Overload  Markets often struggle for traction when there is a lack of a clear motivator such as meaningful event risk or an evolving systemically important theme. On the other hand, there are times when a surfeit of important events, indicators and headlines overwhelm the clear speculative picture, leaving us with an abundance of volatility without the benefit of a reliable course. We have dallied with this latter scenario these past weeks, but the constant redirec

JohnDFX

JohnDFX

Australian markets in focus - APAC brief 19 Feb

News flow light thanks to US holiday: SPI Futures are indicating a flat start for the ASX200 this morning, in a 24-hours starved of meaningful news and data. US markets were closed for the Presidents’ Day holiday, meaning a crucial source of information was absent from the news flow. It was perhaps a positive thing for market-bulls: the vacuum left by US markets allowed for Asian and Europe equity indices to seize the improved sentiment flowing from Wall Street on Friday, following further progr

MaxIG

MaxIG

APAC brief 26 Mar

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

MaxIG

MaxIG

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