Capital Daily We don’t expect China’s stock market to stage a big rebound We aren’t surprised that China’s stock market has been under pressure lately, and don’t anticipate it will rebound significantly over the rest of the year. 25th March 2021 · 5 mins read
Capital Daily The recovery in the US dollar may have further to run We expect the US dollar to end this year a bit stronger against most other DM currencies, as bond yields rise by more in the US than elsewhere. We think that the greenback will make some of its... 24th March 2021 · 6 mins read
Capital Daily First few months of 2021 may set the tone for the rest of this year It is a year today since global equities generally bottomed out after COVID-19 sent shockwaves through financial markets. The markers in Chart 1 shows the returns since 23rd March 2020 from the 19... 23rd March 2021 · 6 mins read
Capital Daily Contagion from Turkey sell-off will remain limited in our view The sell-off in Turkish assets and the lira sparked by President Erdogan’s decision over the weekend to sack the central bank (CBRT) governor Naci Agbal is likely to continue over the coming weeks in... 22nd March 2021 · 5 mins read
Capital Daily BoJ review points to divergence between central banks While the Bank of Japan’s adjustments to its policy framework have limited near-term market implications, we think they are illustrative of differing central bank outlooks that will ultimately lead to... 19th March 2021 · 7 mins read
Capital Daily What to make of the steepening US real yield curve The renewed sell-off in the Treasury market since the conclusion of yesterday’s FOMC meeting may seem hard to square with the message that monetary policy is likely to remain very loose for a long... 18th March 2021 · 6 mins read
Capital Daily The Fed, EM central banks and the outlook for EM LC bonds We think that the Fed’s next moves will be key to the outlook for emerging market (EM) local currency government bonds. 17th March 2021 · 7 mins read
Capital Daily We don’t expect the euro to weaken much further against US$ We think that the recent widening of the yield spread of 10-year US Treasuries over German Bunds will not continue. With this in mind, we expect the euro to regain some of the ground it has recently... 16th March 2021 · 5 mins read
Capital Daily Monetary policy, economic growth and bond yields In our view, as the pandemic eases major central banks will generally take a more cautious approach to tightening monetary policy than they did in the past. This underpins our forecast that the yields... 15th March 2021 · 6 mins read
Capital Daily Flashbacks to May 2013? Unlike during 2013’s “Taper Tantrum”, we think that Fed policy will prevent a further sell-off in US Treasuries from leading to a broad-based rout in “risky” assets anytime soon. 12th March 2021 · 7 mins read
Capital Daily ECB’s dovishness suggests peripheral yields will fall further The ECB’s decision today to step-up the pace of its purchases suggests that the central bank will continue to underpin the sovereign bond market for some time yet and supports our view that the yields... 11th March 2021 · 5 mins read
Capital Daily Rising inflation no obstacle to continued super-loose Fed policy Although some measures of expected inflation have been creeping up recently in the US, they generally remain well below the levels that in our view might conceivably prompt the Fed to reassess its... 10th March 2021 · 7 mins read
Capital Daily Counting the headwinds to China’s stock market We doubt the recent underperformance of the stock market in China has run its course, even if it may not continue to fall in absolute terms for the rest of the year. 9th March 2021 · 6 mins read
Capital Daily US equities still at the mercy of the bond market Today’s early pull-back in the US stock market is a reminder that good news for the economy can be bad news for equities when it leads to a reassessment of the outlook for bonds. Nonetheless, the... 5th March 2021 · 7 mins read
Capital Daily Cross-country equity market performance and rotations We think that stock markets in the US and China will resume their upward trends before long. Nonetheless, we suspect that they will keep underperforming those in many other countries. 4th March 2021 · 5 mins read
Capital Daily Appetite for risk and the US stock market Even if a lot of good news is now embedded in the US stock market, we still think that it will make some more headway over the coming year. Our end-2021 forecast for the S&P 500 remains 4,200, which... 3rd March 2021 · 7 mins read
