US equity valuations are at all-time highs - but not without reason. Is this a bubble that won't burst?Equities have entered a new paradigm as a function of the pandemic with valuations and real yields reaching levels we have not seen in recent history. Profit margins are at all-time highs...
The US dollar could make life miserable for the bears in Q4 before rolling over
If the USD didn't weaken in Q3 when conditions were perfect, don't expect it to in Q4. But what about 2022?Currencies were quiet in aggregate in Q3—certainly the majors—but there were a number of entertaining single stories such as the weak AUD, and the strong NZD and NOK. It’s perhaps...
Real yields a boon to tightening commodity markets
The growth trajectory might slow a little, but the commodity rally is far from being out of fuelAfter what has already been a strong year for commodities, we maintain a bullish outlook into Q4 and beyond. The strong rally seen across many key commodities this year has been driven by...
Crypto traders chasing high returns in decentralised applications
Bitcoin's era of dominance could be under threat, as investors put large cash flows into blockchain applications.The crypto markets have gained popularity for traders in their search for assets with positive returns in a negative real-rate environment. This is despite the large drawdowns in the crypto markets and the heavy...
Negative real rates’ house of cards might soon collapse
Inflation's rising and the yield curve's steepening. How can bond investors navigate the changing financial landscape?Real rates are going to be a central theme of the investment narrative in the upcoming months. Since the Covid-19 pandemic, financial markets have grown heavily dependent on the loose financing conditions that negative real...
French Election Update: The Far Right’s Big Battle
The 2022 French presidential election is still far away. However, investors should already get more familiar with a Trump-inspired candidate, the TV columnist Eric Zemmour, who is skyrocketing in recent polls. The momentum is on his side, for now. But we still expect the second round will oppose the outgoing...
Crypto Weekly: Banning – not banning
Federal Reserve chairman Jerome Powell stated that the US has no plans to ban cryptocurrencies, as we saw two weeks ago in China. Visa has initiated a research project to facilitate transactions between numerous stablecoins and central bank digital currencies.US is taking a lighter stance than China Two weeks ago,...
Fixed income market: the week ahead
This week it's all about the nonfarm payrolls and whether the Federal Reserve will taper purchases under its QE program in November or not. A strong jobs report will hint at a November tapering and more aggressive monetary policies ahead, contributing to a bear flattening of the yield curve. However,...
US-China trade relationship shifts back to the front burner today
Today we look an attempt to put together a strong close last week and why markets wilted again overnight, in party on news out of China, but also on sources indicating that the US Trade Representation Katherine Tai is set to say that China is not living up to the...
COT: Speculators focus on energy crunch and dollar strength
Futures positions and changes made by hedge funds across commodities, forex, bonds and stock indices up until last Tuesday, September 28. A week that saw continued risk adversity drive stocks lower and the dollar higher in response to China property sector debt concerns, the global energy crunch, and surging treasury...