Financial Markets Commentary

— In association with the overseas atlas

Is This The Start of a Messier Period for These Markets?

April 13, 2014 - No Comments

A bizarre, head scratching post FOMC minutes surge for risk and bullishness was strongly reversed and then a bigger sell-off ensued over the last couple of days. The equity market is starting to show signs of life and is questioning overstretched valuations and crushing momentum stocks and picking on the poor tech sector. However, other markets are yet to follow and FX is rather placid in comparison. The USD is having difficulties: On the risk on jump post those over interpreted Fed minutes, the USD was sold, and …

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ECB’s Bluff Masterstroke & A Sinister Risk Reversal

April 6, 2014 - No Comments

Finally, simultaneous new all time highs in the Dow and S&P. Something the market had not seen since the end of December. Ironically, that occurrence then was followed by a prolonged sell off in January. Indeed, the recent non-stop positive risk environment had a nasty reversal on Friday after the not so gangbusters non farm. This week will have much to say about the risk trade’s sentiment, given the scant data on offer. Earnings season is upon us again and, as …

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Will These Markets Become More Interesting?

March 30, 2014 - No Comments

Continued random, erratic price action across all markets as we conclude the quarter. A quarter that, overall, was not very enthralling in the markets. The S&P has to decide whether, come Monday evening, it will close the quarter positive for the year (above 1849) or negative. The likes of the Nikkei, the FTSE, the DOW, the NASDAQ, and USDJPY are all negative for the year. Our very brief thoughts: ECB/EUR: Certainly a lot more dovish rhetoric was pulled out this past …

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A Deliberately More Hawkish Fed and Maybe Now a Tiring S&P.

March 23, 2014 - No Comments

The market decided to trade the ‘Putin Put’ yet again, as well as some selective choice of data flows, so leading to the standard disproportionate, asymmetric reversal of the laboured risk off tone we had seen the week before, so creating a marginal new all time high in the S&P. However, a decent reversal on quadruple witching day could be taken as a small signal of intent against this constant ‘new all time high’ obsession. As well, there is now a realisation that the …

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A Bigger Shakeout in Risk Ahead or Yet Another Opportunity For the Relentless Bid?

March 15, 2014 - No Comments

Some retreat of the risk trade has been seen and some of the record highs debt margin community will be more ponderous this weekend. The question now is whether ‘the relentless bid’ crowd is waiting to hoover this small retrenchment? China, emerging markets, industrial commodities, the DAX, the JPY and the CHF were all centre stage this week. We believe there are greater global macro concerns at the moment than whether Russia annexes Crimea. Our brief thoughts: US/Fed: We await the Fed and …

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