Insight from our top analysts on the news that matters
Nothing new has been said as a result of the FOMC meeting this week. We have not taken a single step forward regarding our quest on the timing of the first Fed rate hike. Fed said it will raise rates when some further improvement in labour market is seen and ‘reasonably’ confident inflation will move back to 2% target, adding that the inflation continues to run below objective, partly reflecting earlier declines in energy prices & prices of non-energy imports.
Fed’s reluctance to change its view on inflation ...Read article
It’s a bumper day on the corporate calendar but the effect on equity indices has been fairly muted in the aftermath of the rallies earlier this week. The FTSE is trading fairly flat, up a mere 14 points, with seven of those points coming from Royal Dutch Shell. The capex and job cuts continue at the oil giant, as $50 crude oil starts to dig its heels in, and with added bearishness on the prospect of a return to more favourable levels. Holding up the share price today is an ...Read article
Some bet for a first rate hike in September, others have hard time imagining Yellen pushing for higher rates any time before December, while a minority expects both a September and a December rate hike. The US sovereigns still price less than 50% probability for a rate hike before the end of the year. The lack of conviction in the US sovereigns could trigger a rapid hike in US yields should the Fed’s step toward a more orthodox policy concretize.
The size of the rate hike will ...Read article
The relief in the FTSE this morning can only be viewed with suspicion. Having wiped out all its gains year to date and following five days of consecutive losses, there is a distinct odour of dead cat emanating from the bounce. It’s clear that the Chinese economy is slowing but taken in context, it is still growing and certainly still managing to outperform other western economies with gusto. Market participants have, in all fairness, take the Shanghai Composite rout in their stride, with most feeling that it merely ...Read article
The UK’s gross domestic product grew 0.7% on quarter according to second quarter advance read released in London this morning, on yearly basis the UK is expected to secure a 2.6% growth, a slightly lower than 2.9% printed previously. Still, the strong GDP read only supports the view that the UK is on a faster run to recovery compared to subdued economic performances from the US and the Europe.
Despite the raising voices against the stronger pound, and its negative impacts on the UK manufactural and industrial exports, the ...Read article
Asian equity markets made a bearish start to the week following 0.3% y/y drop in Chinese industrial profits on weak commodity prices and slowing activity. Shanghai’s Composite lost more than 5% and fell below 4000 mark (at the time of writing), Hang Seng index wrote-off 2.65%. The BoJ DepGov Nakaso is said to be watching the impacts of tighter Fed policy and the subdued fundamentals in China. BoJ will adjust policy if needed, he said.
With earnings season in full swing, there will be a host of trading opportunities ...Read article
All indicators point at a slowing Chinese economy. The further contraction in China’s manufacturing PMI gives some relevance to suspicions that the 7% GDP growth printed last week may have been somehow manipulated.
As China faces difficulties putting its 10 trillion dollar worth economy back on its feet, increasing stress invade the Asian markets and the antipodeans. The softening in commodity prices pushes the commodity-sensitive economies to take a step back toward unorthodox monetary policies. The commodity prices fall as a coin thrown into a dark pit, where ...Read article
The FTSE made a bullish start in London following encouraging financial results from Unilever released before the open, yet has thus far failed to extend those gains.
6650 continues as a supporting level, a break below this level could rapidly push towards 6520. The recent appreciation in pound and the Bank of England preparing to increase the benchmark rates is an extra weight on investors’ appetite. The unexpected 0.2% contraction in June retail sales should be a drag for an setback above the 6745p mark (200d MA). Year on year, ...Read article
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