Europe

Inflation is hot, but inflation expectations are not. We explain the answer to this apparent puzzle and discuss the investment implications. Plus we identify two commodities that are at imminent risk of reversal.

3 years ago

Essentials

Europe: Hedging Market Risk

According to BCA Research’s European Investment Strategy service, the downside in earnings over the remainder of the year creates a dangerous risk that can catalyze a sharp pullback at any moment. To protect themselves, investors can separate the alpha and…

3 years ago

Essentials

German Business Morale Improves Slightly

Germany’s Ifo Business Climate Index inched up from 93.2 to 93.6 in April, slightly above anticipations of a more muted rise to 93.4. Interestingly, a 1.2-point increase in the Expectations components drove the improvement in the headline index and surprised…

3 years ago

Essentials

French Consumer Discretionary Equities Benefit From China’s Reopening

French MSCI consumer discretionary shares have performed strongly over the past year, booking a gain of 31%. Consequently, they have outperformed global consumer discretionary by 42%, and the Eurozone stock market by 24%. As a result, French consumer…

3 years ago

CoreMacro

Valuation And Earnings Filters To Hedge Market Risk

European equities continue to inch closer to record highs, yet, their earnings outlook is deteriorating. How can investors build hedging portfolios using the message from earnings and valuations to protect themselves against the growing risk of a pullback?

3 years ago

Europe

FICC

Fiscal Dominance Risk Pushes Gold Target To $2,200/oz

We are increasing our gold price target to $2,200/oz, given the increasing risk of fiscal dominance in the US, rising geopolitical risk, the return of trading blocs and currency debasement risk. These risks also will increase economic uncertainty, which also will be bullish for gold.

3 years ago

Commodities

Essentials

Stronger-Than-Anticipated UK Inflation

UK inflation came in hotter-than-anticipated in March. Headline inflation remained in double digits at 10.1% y/y, above expectations that it would recede from 10.4% y/y to 9.8% y/y. Similarly, the core index was unchanged at 6.2% y/y, disappointing consensus…

3 years ago

Essentials

Deteriorating Global Growth Expectations …

The ZEW Survey of German investor sentiment unexpectedly deteriorated in April. The sentiment index fell 8.9 points to 4.1, disappointing consensus estimates of an uptick to 15.6 and recording its second consecutive monthly decline. This move reveals that…

3 years ago

Essentials

G7 Diplomats In Japan (Part 1)

The top diplomats of the G7 countries – US, Japan, UK, Canada, Germany, France, Italy – plus the European Union are meeting in Karuizawa, Japan on April 16-18. The summits are going forward despite Japan’s recent domestic security concerns stemming from a…

3 years ago

Essentials

G7 Diplomats In Japan (Part 2)

The reason why the EU will try to balance economic ties with China along with defense ties with the US for as long as possible is not strictly economic. Europe and the US are much more reliant on China than Taiwan for trade, but that has not prevented the US…

3 years ago

Europe

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