Capital Daily Policymakers still struggling to turn the tide in markets While the US Congress remains deadlocked over the fiscal response to the COVID-19 pandemic, the Fed has once more stepped into the breach with another massive monetary policy support package. Although... 23rd March 2020 · 7 mins read
Capital Daily Fed swap lines might not be enough to stop the dollar’s rise While the additional swap lines announced by the Fed today seem to have given respite to a few embattled currencies, they may not be sufficient to stop the dollar in its tracks. We think that the... 19th March 2020 · 7 mins read
Capital Daily Sovereign bond yields still being driven up by fire selling Today’s further big increases in the yields of US Treasuries and UK Gilts appear to reflect continued fire selling of “safe” assets to cover losses on “riskier” ones, rather than worries about the... 18th March 2020 · 7 mins read
Capital Daily Shutting stock exchanges isn’t the way to restore confidence The extra stimulus and measures to ease strains in the financial system announced by central banks over the weekend have failed to prevent stock markets from tumbling again today, as concerns mount... 16th March 2020 · 7 mins read
Capital Daily Fed-inspired bounce may already be fading Although equity markets are staging a tentative rally today on the back of renewed hopes that policymakers will save the day, our view remains that until there are clear signs that the coronavirus... 13th March 2020 · 8 mins read
Capital Daily ECB fails to the save the day The reaction to the ECB’s announcement of another stimulus package to fight the effects of the coronavirus is yet another reminder that monetary policy cannot save the day. 12th March 2020 · 5 mins read
Capital Daily Making sense of the reaction to the UK’s big stimulus package The subdued response in the financial markets to the big monetary and fiscal stimulus announced in the UK today should not be interpreted as sign that investors think it will be ineffective in helping... 11th March 2020 · 7 mins read
Capital Daily Global equities could fall further in the near term We think that global equities could yet fall further in the coming weeks and months, despite the plunge in most markets today. We still expect a recovery later this year, but the timing looks likely... 9th March 2020 · 7 mins read
Capital Daily Even crisis-level policy rates might not boost Treasuries from here Even if the coronavirus affects the US economy by more than we are anticipating in our baseline scenario, we doubt that Treasury yields will fall to even lower levels. 6th March 2020 · 6 mins read
Capital Daily Virus spread matters more than stimulus measures for equities Despite a pullback today, equity markets have staged a tentative recovery this week on hopes that policymakers will cushion the blow to the global economy. But our view remains that stock markets are... 5th March 2020 · 5 mins read
Capital Daily Biden’s comeback a mixed blessing for US equities In an otherwise gloomy week for US equities, the resurgence of Joe Biden in the race for the Democratic presidential nomination provides, at least at face value, one piece of good news for them. But... 4th March 2020 · 7 mins read
Capital Daily Powell Put may not be enough While it appears that central banks are preparing to once again ride to the rescue, further monetary stimulus by itself may not be enough to generate a sustained recovery in risky assets. 2nd March 2020 · 7 mins read
Capital Daily Markets may force the Fed’s hand The S&P 500’s 14% plunge this week is the fastest such correction on record; the VIX index is now at its highest level since the euro-zone crisis in 2012; and the 10-year US Treasury yield has fallen... 28th February 2020 · 7 mins read
Capital Daily Re-examining the market reaction since the coronavirus outbreak Equities outside of China have continued to sell off today as the number of international new coronavirus cases has overtaken those reported by Beijing for the first time since the outbreak began. By... 27th February 2020 · 7 mins read
Capital Daily UK equities likely to bounce back if virus fears fade A surprising feature of the recent sell-off in global equities is the underperformance of the UK. There are still reasons to think UK equities will outperform in the coming years, but this may have to... 26th February 2020 · 6 mins read
