Incoming data and high-frequency indicators point to a soft patch in the global recovery amid the current surge in the pandemic. However, we expect the current softness to mark a bottom in the economic and health crisis as…
Highlights The (earnings) yield premium on tech stocks versus the 10-year bond yield is at its 2.5 percent lower threshold that has signalled four previous market fragilities. Additionally, the 65-day fractal structure of stocks…
Highlights The Fed will continue to have investors’ backs in 2021 (and beyond): The Fed will maintain extremely accommodative policy settings to combat low inflation expectations and growth that could still falter in the face of…
Highlights The ongoing pandemic underscores the need for fiscal and monetary policymakers to continue to provide a reflationary “bridge” until vaccination ends the threat to the health care system. The pending deal being…
Highlights Global growth will accelerate over the course of 2021 as COVID-19 vaccines are distributed and economic confidence improves in response. Longer-term global bond yields see some upward pressure as growth picks up, but global…
Dear Client, We are sending you our Strategy Outlook today, where we outline our thoughts on the macro landscape and the direction of financial markets for 2021 and beyond. Next week, please join me for a webcast on Thursday, December…
Highlights Brexit no-deal vs. deal = 1.28 vs. 1.37 on GBP/USD. Any break-out into the high 1.30s is a tactical sell – because the bigger driver of GBP/USD is the global stock market, which is due a breather. The medium-term…
The euro area is likely to experience a contraction in economic activity in the 4th quarter of 2020, but there is hope this deterioration is already passing. The decline in activity highlighted by the Google Mobility…
Highlights Don’t trust market inflation expectations or real interest rates. When inflation is near-zero, think in nominal terms not in real terms. New structural recommendation: Underweight inflation protected bonds versus…
Risky asset prices rose very significantly in November, in response to the discovery of multiple effective and apparently safe vaccines. But as investors have continued to digest the vaccine news, Europe and the US have been…