Tag Archives: stocks

“It is not surprising the Fed once again failed to take action as their expectations for economic growth were once again lowered. In fact, as I have noted previously, the Federal Reserve are the worst economic forecasters on the planet. As shown in the table/chart below, not only are the expectations for economic growth now the lowest on record, the Fed has given up on 2% growth for the economy with the long-run...

The probability of Republican Donald Trump winning the U.S. presidential election on November 8 seems remote at the moment—economists on Credit Suisse’s Global Markets team put it at less than 10 percent. So if it did happen, it would come as a major surprise for financial markets. The last time that kind of seemingly low-likelihood event came to pass—during last June’s Brexit vote—most investors were caught wrong-footed. So how might they best prepare for something as unexpected as President...

As I noted on Thursday, the Fed non-announcement gave the bulls a reason to charge back into the markets as “accommodative monetary policy” is once again extended through the end of the year. Of course, it is not surprising the Fed once again failed to take action as their expectations for economic growth were once again lowered. Simply, with an economy failing to gain traction there is little ability for the Fed to...

Will the recent upheaval in Brazil’s political leadership lead to a stronger economy? Investors certainly think so. Fueled by anticipation of embattled president Dilma Rousseff’s impeachment and economic reforms by her replacement, Michael Temer, the Bovespa has jumped more than 50 percent since late January. In the week after Rousseff’s official ouster on August 31, the index rose a full 4 percent, and Brazilian consumer confidence reached its highest level since January...

There are numerous reasons to be optimistic about global equities in the coming year. Capital is plentiful; central banks in Europe, the United Kingdom, and some Asian economies have an easing bias; and the equity strategists on Credit Suisse’s Global Markets team believe the equity risk premium is higher than warranted. But there are risks, too, including heightened political risk, slowing Chinese growth, and threats to existing business models from technological disruption and Chinese...

Summary: Global bonds and global stocks ended last week on a weak note and this will likely carry into this week’s activity. The Bank of England meets, but the data may be more important. Oil and commodity prices more generally look vulnerable, and this coupled with higher yields sapped the Australian ad Canadian dollar in the second half of last week. The week ahead will likely be shaped by a combination of...

Is it August 2015 again? In the first week of January, a spectacular Chinese stock market crash once again prompted officials to provide extraordinary stimulus measures and devalue the yuan. Just as before, gyrations in China pushed global markets deep into risk-off mode, with selloffs in Asian, European, and U.S. equities, as well as crude oil futures. The resolution is likely to be the same as it was last August, too, according to Kasper Bartholdy, Head of Emerging Market Fixed Income...

For the three months leading into August, the Chinese government had kept the yuan-dollar exchange rate fixed in a tight range around 6.115 yuan to the dollar. Yet the yuan’s spot price consistently traded about 1.4 percent weaker than the fix. Investors, in other words, sensed a devaluation coming. In mid-August, Chinese officials proved them right by intervening in currency markets for three days in a row, prompting a 3 percent drop in the value of the yuan.   An 8 percent decline in...