On the 11th February there were two very different headlines on the coronavirus:
This was indicative of confusion that many felt at the time. Though he later qualified his statement, Dalio seemed to be reflecting a complacency in… Read the article
Category: Noise corner
Trading Brexit: How are you positioned?
The cliched response to the UK election result was that Brexit uncertainty had been removed; this was what explained the immediate rally in Sterling and UK stocks, and a sell-off in Gilts.
But only a couple of days later we found ourselves straight back in a world of volatility:
Why hasn’t the market moved more on the Brexit deal?
This
The market is being sensible on inflation. For the right reasons?
The market often seems like a London commuter with an umbrella and a mobile phone: failing to look ahead and causing damage to bystanders by overreacting to near term threats.
But there has certainly not been any overreaction when it comes to potential inflation. The recent drone attacks on Arabian… Read the article
Episode blog Quicktake: Theresa May’s Resignation
As Theresa May remarked in her resignation speech, her successor will face the same challenge of finding consensus over Brexit within Parliament. So far Westminster has been able only to express what it doesn’t want, and has failed to coalesce around a way forward. The path ahead remains as uncertain… Read the article
Episodeblog Quicktake: Trade Wars reignite
While markets were closed in Japan, Korea, Thailand and the UK yesterday, stock markets in other regions ‘plunged’ (there’s that word again) on a re-emergence of trade war fears.
Domestic Chinese markets were the hardest hit, with some impact on neighbouring countries.
The source of the moves,… Read the article
Episodeblog Quicktake: The Brexit vote delay and UK leadership contest
There’s been some clamour around everybody’s favourite UK-related subject this week: Brexit and politics are once again grabbing the headlines.
Given the extent of coverage I thought it worth recapping (briefly) how our view on these matters is formed and how we might begin to assess the relevance of… Read the article
An inverted yield curve… because the market has already done the Fed’s job for them
Behavioural Finance Markets
Yesterday, the US yield curve became inverted. The yield on three-year Treasuries was temporarily (blink and you’ll miss it) lower than that of their two-year counterparts. This is, apparently, huge.
Many are worried because an inverted yield curve has frequently been a sign of upcoming… Read the article
Beware the allure of a good-looking chart
I received the following chart from a broker earlier this week. It plots the trailing 12-month price return on the US stock market versus a survey of activity in the US manufacturing sector, where a score above 50 indicates expansion and vice versa.
The broker’s conclusion was straight-forward, “if you… Read the article
Episodeblog Quicktake: Italian Markets
Markets reacted sharply to the weekend’s news that ongoing attempts to form a coalition government in Italy had collapsed after the President’s rejection of the proposed Finance Minister, prompting likely new elections later this year.
Unstable governments in Italy are nothing new, but markets are worried… Read the article