Digest

  • Gamma said knock you out

    Gamma said knock you out Cover image Published 11 Jan 2019 by
    Please note that we will not publish a Macro Digest next week, as we will be visiting clients in Texas. The next Digest will hit your inboxes on 25 January. In the meantime, e-mail alerts will be published as required, and please reach out if you have any questions or comments.After the dramatic..

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  • A dove with claws

    A dove with claws Cover image Published 14 Dec 2018 by
    Please note that this is the final Macro Digest of 2018. Normal service will resume on 11 January. We wish our readers a prosperous 2019!Two of our three ‘great expectations’ events, which we wrote about two weeks ago (see Macro Digest: Great expectations, 30 November 2018), have resulted in outc..

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  • Great expectations

    Great expectations Cover image Published 30 Nov 2018 by
    Donald Trump seems to be caught in a time warp. Or perhaps he is suffering from muscle memory in his brain from the countless Wall Street Journal op-eds he read during the 1980s. Because thinking from that era would appear to be fuelling his policy imperatives this year: Iran is bad, interest rat..

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  • Nuance is dead

    Nuance is dead Cover image Published 16 Nov 2018 by
    Please note that, owing to the Thanksgiving holiday, there will be no Macro Digest next week. When positions are being liquidated, there is no such thing as nuance. And this week the oil market was capitulating, as evidenced by the three-standard deviation jump in volatility, one of the larg..

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  • Widespread panic

    Widespread panic Cover image Published 9 Nov 2018 by
    Investors continued to shed long positions in crude this week as WTI finished down for its ninth consecutive day on Thursday, the first time that has happened since July 2014. Should Friday close in the red, it will mark the first time in over two decades that crude has closed lower for 10 consec..

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  • Going for the jugular

    Going for the jugular Cover image Published 2 Nov 2018 by
    The capitulation in crude oil continued this week as both flat price and spreads tumbled for the third straight week. Even on days when equities bounced as they tried to find a floor, crude continued to sell off, driven in large part by the weakness in timespreads. The 9% October sell-off in Bren..

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  • Is the reflation bubble bursting?

    Is the reflation bubble bursting? Cover image Published 26 Oct 2018 by
    Risk assets tumbled yet again this week due to a combination of spiking volatility, earnings that failed to live up to overly inflated expectations, and a weak US Treasury auction that stoked fears that China is pulling back on its purchases as a consequence of the trade war. Meanwhile, correlati..

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  • Red rising

    Red rising Cover image Published 19 Oct 2018 by
    A rising wave of red flooded our screens this week, and it’s not clear that its done yet either. There are no moral victories in trading. Just profits and losses. And we are certainly not ones to pick a fight with the market, especially when global risk assets are in complete meltdown. But..

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  • VaR she blows

    VaR she blows Cover image Published 12 Oct 2018 by
    The sell-off in global equity markets this week reminds us of a story from back in the 1970s, when a Georgia man accused of murder was asked by the judge if he had anything to say in his defence. The man replied, ‘well, your Honour, I guess he just needed killin’, and allegedly half o..

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  • The man in the mirror

    The man in the mirror Cover image Published 5 Oct 2018 by
    Though oil markets started the week off strong (more on that below), a late-week bout of risk-off sentiment triggered by unexpectedly hawkish comments from US Federal Reserve Chairman Jerome Powell and surprisingly strong US data over the course of the week, caused risk assets to sell off, taking..

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  • Déjà vu

    Déjà vu Cover image Published 28 Sep 2018 by
    Listening last week to Saudi Energy Minister Khalid al-Falih speak to reporters in Algiers, it was hard to avoid a strong sense of déjà vu. After all, oil prices today are tracking a very similar path to the dramatic spike of 2004 to 2008 when, like today, Saudi spare capacity effec..

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  • Florence and the machine

    Florence and the machine Cover image Published 21 Sep 2018 by
    Many of you have asked us how the escalating tariff battle between the US and China will affect trade and what that means for the global economy. Several banks have been pounding the table with increasing volume and force over the potential for a sudden shock to GDP growth next month once the US-..

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  • Entering the tweet zone

    Entering the tweet zone Cover image Published 14 Sep 2018 by
    Brent crude prices surged early in the week, kissing $80 per barrel and putting the entire oil market on 24-hour tweet watch. Earlier this year, when oil prices reached $80, America’s tweeter-in-chief took to social media to express his displeasure at high prices, telling OPEC to do somethi..

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  • Big mac attack

    Big mac attack Cover image Published 7 Sep 2018 by
    Crude has failed to catch a bid even as prompt Brent spreads have rallied in the last week, with the paper markets growing increasingly wary of the macro backdrop. The tightening in the sour crude market is becoming noticeable as the Iran sanctions begin to bite and, as sour margins get squeezed,..

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  • Check the expiry date

    Check the expiry date Cover image Published 31 Aug 2018 by
    It’s been quite a summer. And perhaps it’s fitting that the Brent October contract should be expiring on the Friday of the Labor Day weekend. After all, Labor Day is the unofficial last day of summer in the US as most kids are about to go back to school and everyone has taken their su..

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