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While the Swiss franc has not benefitted much from recent upheaval in markets, including yesterday’s sell-off in US equities, it has been very stable. We expect this to remain the case in 2019, as slowing global growth and concerns about Italy support the …
8th February 2019
This report is only available as a PDF. Click to download. … What to make of sterling’s post-MPC rebound …
7th February 2019
Although the S&P 500 has risen further since the FOMC’s latest meeting, we still expect the index to falter this year even if the Fed shrinks its stock of assets more slowly and by less than previously envisaged. … Less QT wouldn’t save the US stock …
This report is only available as a PDF. Click to download. … Equities likely to falter soon, whatever happens at Trump summits …
6th February 2019
We expect a slowdown in the US and the rest of the world to put renewed pressure on global stock markets this year. If we are right, we suspect that the dollar would get a boost, as it did late last year when equities slumped. … US dollar likely to …
This report is only available as a PDF. Click to download. … Strong US labour market doesn’t preclude a weaker stock market …
5th February 2019
This week’s flurry of EM central bank meetings will probably add to the signs that the shift towards tighter monetary policy in much of the emerging world is nearing an end. Even so, we doubt that the recent broad-based decline in EM local currency …
This report is only available as a PDF. Click to download. … Analysts’ more downbeat S&P 500 EPS forecasts still too upbeat …
4th February 2019
This report is only available as a PDF. Click to download. … Fed may not be done raising rates yet …
1st February 2019
Although we expect the US federal funds rate to end 2020 lower than it is now, we don’t think that the dollar will decline this year. The reason is our bearish view of the global economy. … A dovish Fed won’t keep the US$ down if the S&P …
31st January 2019
This report is only available as a PDF. Click to download. … Post-Fed weakness in the US dollar unlikely to last …
Frontier dollar bonds have rallied this month, due partly to improved risk appetite, but also progress on IMF deals (Ukraine and Sri Lanka) and the political news flow (Venezuela and Lebanon). But it’s unclear to us that the narrowing of spreads will be …
We think that the recent rally in euro-zone equities will run out of steam. Although a trade deal between the US and China could give a boost to global share prices, including in the euro-zone, we think that any increase will be short-lived and …
30th January 2019
This report is only available as a PDF. Click to download. … US monetary policy outlook points to more upside for Treasuries …
We think that the reactions in bond markets to Brazil’s and Mexico’s new leaders have gone too far. Investors in Brazil look overly optimistic about President Bolsonaro’s ability to turn the public finances around, while investors in Mexico seem too …
29th January 2019
This report is only available as a PDF. Click to download. … Strong start to the year for EM currencies not likely to last …
In this Focus , we consider how sterling, Gilts and UK equities will be affected by the outcome of negotiations over Brexit and the global economic slowdown that we are anticipating. Our judgement is that the UK’s currency and 10-year government bond …
This report is only available as a PDF. Click to download. … The future doesn’t look very bright for the FTSE 100 …
28th January 2019
This report is only available as a PDF. Click to download. … PM May’s Brexit deal still unlikely to pass …
25th January 2019
We think that the darkening prospects for the global economy favour high-grade bonds over equities this year. Our forecasts are for the Chinese and euro-zone economies to lose more momentum, and for a sharp slowdown in the US economy. This will hit …
This report is only available as a PDF. Click to download. … Peripheral euro-zone bonds to struggle despite loose ECB policy …
24th January 2019
This report is only available as a PDF. Click to download. … Accommodative BoJ likely to keep JGB yields low …
23rd January 2019
We have long forecast that the Australian dollar would weaken against the US dollar in 2019 owing to our bearish view of commodity prices and China’s economy. But changes to our outlook for monetary policy mean that we have now become even more negative. …
This report is only available as a PDF. Click to download. … Investors’ worries about global growth likely to get worse …
22nd January 2019
We think that government bonds in the euro-zone “periphery” will fare quite poorly in the next two years – particularly in Italy and Greece – as growth disappoints and deficits overshoot expectations; European elections raise concerns; and the ECB …
This report is only available as a PDF. Click to download. … Gauging the near-term outlook for sterling …
21st January 2019
This report is only available as a PDF. Click to download. … Outlook for Chinese equities poor despite trade war optimism …
18th January 2019
This report is only available as a PDF. Click to download. … Investors still seem too optimistic about S&P 500 earnings …
17th January 2019
We expect EM currencies to weaken against the US dollar in 2019, with the South African rand and Colombian peso likely to fall by more than most. The Argentine peso and Turkish lira will probably be among the worst performers too, even though collapses on …
This report is only available as a PDF. Click to download. … Still more upside risk for sterling …
16th January 2019
We think that loose monetary policy and safe-haven flows will keep the German 10-year government bond yield around its current level this year and next. Yields in most other “core” countries are also likely to remain low, although we expect them to rise a …
The outlook for the euro-zone economy has deteriorated sharply in recent months, prompting us to revise down our growth forecasts for the region. In this Update we discuss the implications of these changes for euro-zone bonds, equities and the euro. … New …
15th January 2019
This report is only available as a PDF. Click to download. … Sterling scenarios in tonight’s crucial Brexit vote …
This report is only available as a PDF. Click to download. … Reaction to China trade data may provide a template for 2019 …
14th January 2019
We think that EM Asian equities are set for more pain in 2019 despite their generally positive start to the year, and suspect that they will again be among the worst performers in the MSCI EM Index. We don’t expect MSCI’s EMEA or Latin America indices to …
This report is only available as a PDF. Click to download. … Brexit risks to sterling are skewed to the upside …
11th January 2019
We remain of the view that slower growth in the US and Chinese economies will push stock markets down sharply again this year, and prevent the yields of high-grade bonds from rising much, if at all. Nonetheless, we have made some tweaks to our key market …
This report is only available as a PDF. Click to download. … Bund yields likely to remain low as euro-zone economy slows …
10th January 2019
Lower prices of commodities have weighed on the currencies of those countries whose fortunes depend heavily on them. Although we generally do not anticipate further large falls in prices in 2019, we think that the Australian and New Zealand dollars remain …
This report is only available as a PDF. Click to download. … A trade deal probably wouldn’t give equities long-lasting relief …
9th January 2019
Three big “non-consensus” calls for 2019 on our Global Markets service are i) developed market government bonds will outperform developed market equities; ii) emerging market equities won’t bottom out before developed market equities; and iii) the US …
This report is only available as a PDF. Click to download. … Safe-haven assets likely to remain in demand in 2019 …
8th January 2019
This report is only available as a PDF. Click to download. … Why this isn’t likely to be a 2016 re-run for equity markets …
7th January 2019
This report is only available as a PDF. Click to download. … US employment report suggests that tightening cycle is not over …
4th January 2019
The S&P 500 has already fallen to around 2,450, a bit below our once-bearish end-2019 forecast of 2,500. This is causing us to question whether it will even end the year that high. … Putting the slump in the S&P 500 into …
This report is only available as a PDF. Click to download. … Downside risks to the dollar appear to be fading …
3rd January 2019
This report is only available as a PDF. Click to download. … Renminbi’s resilience not likely to last …
2nd January 2019
Growth in frontier economies eased over the course of 2018 and we expect activity to be soft in 2019. At a regional level, we think that growth will slow further in frontier economies in Emerging Asia and Emerging Europe next year – the latter will be led …
21st December 2018
This report is only available as a PDF. Click to download. … What to make of the rise in UK inflation compensation …
20th December 2018
Even if the domestic situation in France has calmed down, the underlying causes of the recent unrest linger. What’s more, we think that France has become more vulnerable to contagion risks from Italy. … French bonds likely to remain under pressure in …
19th December 2018
