US equity markets finished last week on a strong note and are up overnight to start the week, although a fresh rally attempt in Chinese markets is showing signs of stumbling in later trading. Elsewhere, the Euro is trading sideways in the wake of the German election, which saw the...
WCU: Energy surge drives renewed focus on inflation
The commodity sector found a fresh bid this past week as the intense and potentially price-negative focus on China Evergrande Group, and its ability to service its debt, faded. While industrial metals recovered on the fading China focus, a fresh spike in bond yields together with a firmer dollar hurt...
FX Update: Long yields suddenly make their presence felt again.
The market tried to slip back into full risk-on mode yesterday, but a huge rise in US treasury yields and sympathetic moves elsewhere at the long end of the curve reminds us how quickly the yield question can steal the spotlight when they are on the move. Next week looks...
The Bank of England wakes up bond bears around the globe, and benchmark yields break key resistance levels
Yesterday's BOE's hawkish tilt intimates that inflation is beginning to force central banks' hands into tighter monetary policies. The bond market is yet not pricing central banks' aggressive twists, making it vulnerable to abrupt selloffs. In the US, real rates continue to rise as breakeven rates remain stable. If this...
Nike warns of margin pressure; Evergrande silence spooks
Nike posted strong Q1 earnings last night but revenue came in a bit lower and the sports retailer warned of margin pressure. Equities are turning lower today as Evergrande silence spooks investors. Nike has seen a phenomenal rebound in its business from the lows during the pandemic. Revenue in Q1...
Spike in long yields grabs the spotlight. Huge week ahead.
Today features Saxo Chief Economist and CIO Steen Jakobsen as we look at the huge spike in longer US treasury yields yesterday and sympathetic moves in EU and UK yields and at what point rising long yields might disrupt an equity market on the comeback trail. We also look at...
Market Quick Take – September 24, 2021
Equity markets came storming back yesterday, retaking a key technical level in the US that was critical on the way down as the latest Evergrande news and a nominally more hawkish than expected Fed failed to hold the bulls back. Still, a new source of concern could be the sudden...
FX Update: FOMC reaction fizzles. BoE hawkish.
Fed Chair Powell managed to surprise the market somewhat during the press conference with clear guidance on an imminent start to QE tapering, but the market reaction was fairly muted, with the action overnight and in the European session today suggesting the Evergrande story is still the hobby horse of...
The bond market dismisses the FOMC’s hawkish signals
The bond market's reaction was muted amid a hawkish Federal Reserve's meeting. Investors decided to focus on shorter-term economic dynamics such as the Delta variant dismissing signals of aggressive tapering and a Fed fund rate forecast of 1.8% for 2024, much higher than the Euro Dollar market pricing. Bond yields...
XAUUSD rallies into H1 resistance; daily still weak
The left chart shows the XAUUSD daily timeframe. Price is in the bearish area, between the lower blue and lower red bands. The right chart shows the XAUUSD hourly. Here the price is rising into resistance (red shaded horizontal). We are looking to see if this is a key level...