Category Archive: 4.) Marc to Market

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The Turn

2019-12-28

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2019-12-28

The year is winding down quietly, and the last week of 2019 is likely to be more of the same.  The general mood of the market is quite different than a year ago.  Then investors had marked down equities dramatically amid fears of what was perceived as a synchronized downturn.  Now with additional monetary easing in the pipeline and renewed expansion of the Federal Reserve and European Central Bank's balance sheets, risk appetites have been stoked.

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FX Daily, December 27: Equities Rally While the Dollar Slumps into the Weekend

2019-12-27

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2019-12-27

Overview:  Equities are finishing the holiday-shortened week on a firm note, encouraged by strong holiday internet sales in the US.  Most markets in the Asia Pacific region advanced except China and Thailand, while Japanese markets were mixed after weak industrial output and retail sales.  The MSCI Asia Pacific Index rose for the fourth consecutive week.

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FX Weekly Preview: Economic Data in the Holiday-Shortened Week

2019-12-23

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2019-12-23

The capital markets will turn increasingly quiet in the week ahead as the Christmas holiday thins participation. If this is the season of goodwill, investors are lapping it up.  Global equity markets are finishing a strong year on a high note.  Record highs were recorded in the S&P 500 and the Dow Jones Stoxx 600.  The MSCI Emerging Markets equity index is at its best level since August 2018. 

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FX Daily, December 19: Whiff of Inflation in the Air

2019-12-19

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2019-12-19

It is risky to read too much into the price action in holiday-thin markets, but inflation fears are beginning to surface. The price of January WTI is around $61, having tested $50 a barrel in Q3. The CRB Index made new highs for the year yesterday and is up almost 9% for the year. The US yield curve (2-10 year) has been steepening after being inverted for a few days in August, and now at nearly 29 bp, also is new highs for the year.

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FX Daily, December 18: Markets Turn Quiet Ahead of Central Bank Meetings

2019-12-18

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2019-12-18

Overview: The capital markets have turned quiet as the year-end positioning drives prices in lieu of fresh developments. Equities in the Asia Pacific region were narrowly mixed. The smaller markets in Asia performed better than the large bourses of Japan, China, and Korea, which eased. European equities are off to a firm start, and the Dow Jones Stoxx 600 is consolidating near the record high set Monday.

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FX Daily, December 17: Sterling Drops as New Brinkmanship Begins

2019-12-17

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2019-12-17

Overview: Efforts by a UK Prime Minister emboldened by a strong electoral victory to ensure that trade negotiations with the EU are not extended as the divorce has encouraged further profit-taking on sterling. After testing the $1.35 area on the exit polls last week, sterling had returned to where it closed before the results were known near $1.3160.

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FX Daily, December 16: China Data Surprises to the Upside while Europe’s Manufacturing PMI Disappoints

2019-12-16

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2019-12-16

Overview: Despite better than expected Chinese data, and last week's investor-friendly developments, Asia Pacific equities were mixed. Australia led the advancing bourses with a 1.6% gain, its largest for the year despite the government revising down growth and wages. China, Taiwan, and Indian markets also moved higher.

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FX Weekly Preview: Central Bank Meetings and Flash PMI Reports, but its Over except for the Shouting

2019-12-16

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2019-12-16

After last week's flurry of events, market activity is set to slow over the next three weeks. But what a flurry of events it was. A new NAFTA apparently has been agreed, and it is set to be approved by the US House of Representatives next week and the Senate early next year.  The US and China struck an agreement that will get rid of the immediate tariff threat and unwind half of the punitive tariffs in exchange for a commitment to buy twice the...

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FX Daily, December 13: Stunning Tory Victory and US-China Trade Boosts Risk Assets

2019-12-13

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2019-12-13

Overview: The combination of a US-China trade deal and exit polls showing the Tories securing a majority in the House of Commons boosted risk assets, sent sterling flying, and the euro sharply higher. Separately, the Fed stepped up its efforts to make as smooth as possible funding over the turn of the year.

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FX Daily, December 12: Enguard Lagarde

2019-12-12

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2019-12-12

With the FOMC meeting delivered no surprises, attention turns to the ECB meeting as the UK go to the polls. Lagarde will hold her first press conference as ECB president today, and it will naturally command attention. Equities are advancing today, and tech appears to be leading the way. In Asia Pacific, Taiwan and South Korea rallied more than 1%, while the Hang Seng gapped higher to almost its best level in three weeks.

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FX Daily, December 11: Sterling Holds Firm Despite Tighter Poll

2019-12-11

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2019-12-11

Overview: The capital markets continue to tread water as investors await this week's key events. The first, the FOMC meeting concludes later today. Tomorrow features the UK election, where the race appears to have tightened, and Lagarde's first ECB meeting at the helm. Global equities continue consolidating the recent gains. Asia Pacific equity markets were mostly higher.

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FX Daily, December 10: Capital Markets: Still Seems to be the Calm before the Storm

2019-12-10

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2019-12-10

Overview: Equities are trading lower, and bonds are mixed as the FOMC, UK election, and the US decision on the December 15 tariffs draw near. The MSCI Asia Pacific Index three-day rally ended today as only China and South Korea's markets rose. Europe's Dow Jones Stoxx 600 gapped slightly lower at the open.

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FX Daily, December 09: China’s Steps-Up Import Substitution Strategy while USMCA Comes Down to the Wire

2019-12-09

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2019-12-09

The important week is off to a slow start. While the MSCI Asia Pacific benchmark extended its gains for a third session, European and US shares are struggling. The Dow Jones Stoxx 600 is consolidating its pre-weekend 1%+ rally, while US shares are trading heavier after rallying for the last three sessions.

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FX Weekly Preview: An Eventful Week Ahead

2019-12-09

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2019-12-09

The US employment report on the first Friday of December usually marks the unofficial end of the year. The desks are often lighter and dealers are loath to jeopardize the year’s bonuses in thin and often erratic markets.  This year is an exception.  Next week features the first ECB meeting with Lagarde at the helm and the final FOMC meeting of the year. 

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FX Daily, December 6: And Now for the Employment Report

2019-12-06

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2019-12-06

Overview:  Asia Pacific equities closed higher today, with India being a notable exception.  Hong Kong and South Korea led with 1% rallies.  For the week, the MSCI index for the region advanced to snap a three-week decline.  European and US bourses have not fared as well.  The Dow Jones Stoxx 600 is paring this week's losses, but it is still off around 0.9% through the European morning session. 

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FX Daily, December 5: Sterling Sent Higher as Market Discounts Next Week’s Election

2019-12-05

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2019-12-05

Overview: Global equity markets have resumed their climb after a wobble at the end of last week and earlier this week. A strong recovery in the S&P 500 on Tuesday signaled yesterday's strong advance that left a bullish one-day island low in its wake. MSCI Asia Pacific Index snapped a two-day decline today with nearly all the market with the notable exception of South Korea advanced.

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FX Daily, December 4: Hope Springs Eternal

2019-12-04

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2019-12-04

Overview: The prospect of not just the failure of the US and China to resolve its trade dispute but a new escalation has sapped the confidence that had lifted equity benchmarks and the greenback. Led by more than a 1% decline in Tokyo (Nikkei), Hong Kong, and Australia, all the major markets in the Asia Pacific region fell. European shares, perhaps encouraged by an upward revision to the flash composite PMI, are snapping a four-day 2.75% slide.

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FX Daily, December 3: US Brandishes Tariff Weapon and Weakens Animal Spirits

2019-12-03

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2019-12-03

Asia Pacific equities mostly declined in sympathy with yesterday's large sell-off in the US and Europe. China and Taiwan were the notable exceptions, while Australia's 2.2% decline, following the central bank meeting that resulted in what many are seeing as a hawkish hold, led the move lower. Europe's Dow Jones Stoxx 600 fell 1.6% yesterday, the largest loss in two months, and is extending the losses for a third session today.

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FX Daily, December 2: PMIs Provide Latest Fuel for Equity Markets

2019-12-02

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2019-12-02

Mostly better than expected manufacturing PMI readings for December, including in China, is providing the latest incentive for equity market bulls. Led by the Nikkei, which was aided by a weaker yen major equity markets in Asia Pacific rallied and recouped most of the nearly 1% loss before the weekend. Europe's Dow Jones Stoxx 600 is also shrugging off the pre-weekend loss and to challenge the multiyear high recorded last week.

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