Digest

  • Tech wars

    Tech wars Cover image Published 19 Jul 2019 by
    While many are hoping for a tactical bullish pivot in risk markets this week, it appears the only thing ‘rising’ is risk itself. Both the VIX (the Cboe options volatility index) and precious metals (historically safe havens during times of economic stress) are starting to rally, in particular gol..

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  • Bad is the new good

    Bad is the new good Cover image Published 12 Jul 2019 by
    There has been a fairly wide divergence between stocks and bonds, with the bond market sceptical of the optimism that has been present in the equity market since the start of the year and expressing greater fears that the economy is headed for a recession. However, since the US Federal Reserve be..

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  • Better late than never

    Better late than never Cover image Published 21 Jun 2019 by
    The Macro-Digest will take a two-week break, due to holiday and travel schedules, returning on 12 July. In the interim, we will keep you updated on developing stories via E-mail alerts. Last week we highlighted three key events that would go a long way towards setting macro risk appetite for..

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  • Crossroads

    Crossroads Cover image Published 14 Jun 2019 by
    Global markets are at a crossroads with three significant pivot points in the coming two weeks for the oil market and more broadly for general risk appetite. Next week, the US Fed meets to discuss policy and markets continue to price in higher odds of a rate cut. The week after, OPEC is scheduled..

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  • Paging the plunge protection team

    Paging the plunge protection team Cover image Published 7 Jun 2019 by
    A dramatic 20% fall in crude prices since 1 May is conjuring memories of Q4 18’s liquidity-induced risk assets crash and bringing recession fears to the surface. But this time around, while crude has been capitulating, equities have not. In fact, the divergence between crude and equities is almos..

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  • Pushing on a string

    Pushing on a string Cover image Published 31 May 2019 by
    Risk assets have continued to consolidate this week as traders try to weigh the whole range of risks before them this summer, perhaps still holding out hope for a positive outcome to the US–China trade negotiations. After rallying by 40% from January to April, Brent has now eased by some 13% off..

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  • Huawei to hell

    Huawei to hell Cover image Published 24 May 2019 by
    In a bit of a delayed reaction to last week’s China tariffs announcement, the market this week has finally started to absorb that the dispute between Washington and Beijing is about much more than just the trade imbalance between the two countries. Coupled with weakening PMIs in Japan, Europe and..

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  • The Trump doctrine

    The Trump doctrine Cover image Published 17 May 2019 by
    Oil fundamentals and geopolitics trumped the trade war this week as oil prices outperformed equities to finish the week higher despite the breakdown in the US-China trade talks at the end of last week and fears of a protracted trade war weighing on sentiment. Crude oil prices showed great resilie..

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  • A game of chicken

    A game of chicken Cover image Published 10 May 2019 by
    While most countries would be loath to get involved in two simultaneous conflicts, the Trump administration has had no qualms over opening multiple fronts at the same time. But with geopolitical tensions running high, it seems that the war that the market will have to come to terms with is not ex..

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  • Zombie apocalypse

    Zombie apocalypse Cover image Published 3 May 2019 by
    We all know that scene in a horror movie where the heroine predictably goes to hide from the zombies in the basement where the boyfriend keeps his vintage collection of chainsaws and hockey masks. Everyone in the theatre has to fight the urge to jump up and scream: “No, you idiot! Get out!” But,..

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  • One step forward, two steps back

    One step forward, two steps back Cover image Published 26 Apr 2019 by
    Oil prices caught a bid early in the week as the Trump administration’s surprise announcement it would not renew Iran sanctions waivers caught many in the market off-guard. But the rally in flat price stalled and remains underwhelming compared to the move in timespreads, which continue to s..

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  • I still know what you did last summer

    I still know what you did last summer Cover image Published 12 Apr 2019 by
    Due to the Easter holiday the next Digest will be published on 26 AprilThe sequel to the cult classic movie ‘I know what you did last summer’—one of the seminal horror films of the 1990s—begins by highlighting the main antagonist’s difficulty getting over the events of previous summer, haunted by..

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  • Waiting for the fireworks

    Waiting for the fireworks Cover image Published 5 Apr 2019 by
    While a lot of the press focus and commentary this week will be on Brent hitting $70 per barrel—a six-month high (yippee)—the more impressive move in our eyes has been the tightening of the WTI crude curve from a relatively steep contango in the front to flat in just three weeks. To be sure, the..

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  • Trouble with the curve

    Trouble with the curve Cover image Published 29 Mar 2019 by
    The collective gasp that you probably heard early in the week was triggered by the inversion of the shorter end (the very front part) of the Treasury yield curve. The 3-month treasury bill now yields more than the 10-year Treasury for the first time since 2007. For many, especially those in the b..

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  • You break it, you buy it

    You break it, you buy it Cover image Published 22 Mar 2019 by
    Back in January, in the first Macro Energy Digest of the year, we argued that the market in December had missed some important signals out of Saudi Arabia, perhaps distracted by the broader capitulation in risk assets and the dramatic about-face from the Kingdom on production over H2 18. We point..

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