Category: Daily Instagraph

Amid the justified excitement around AI and the power of innovation, it is worth remembering that technological progress inevitably brings disruption at the company level. Today’s perceived leaders are not guaranteed to remain tomorrow’s winners. History offers clear reminders. Railway companies once dominated markets before fading. More recently, Kodak and Polaroid—both pioneers in their fields—failed … Continued

Markets cheered yesterday’s temporary ceasefire with Iran and the announced reopening of the Strait of Hormuz. However, the situation remains fragile, particularly given ongoing tensions in Lebanon. More importantly, normalization of trade flows will not happen overnight. According to JP Morgan, it may take up to three months for tanker traffic to return to normal … Continued

Oil is moving back toward $90 following the announcement of a temporary ceasefire between the US and Iran. Brent is down around 13%, unwinding much of the geopolitical risk premium. Markets are reacting quickly: Nikkei +5% this morning, European equity futures +5.2%, and S&P 500 futures +2.4%. US 10-year yields are down 5bps to 4.24%, … Continued

Today’s chart shows that markets still see the outcome of the US-Iran conflict as no better than a toss-up. Polymarket, an online prediction market, is pricing only around a 50% chance of a ceasefire by the end of April, which tells us that investors are not yet convinced that a clear off-ramp has been found. … Continued

As shown in our daily a couple of days ago, oil futures remain in backwardation, with the curve clearly sloping downward and December delivery still trading below the current spot price. This continues to suggest that forward markets are not really believing in a long lasting oil shock. Today’s chart adds an important confirmation to … Continued

While most investor attention is currently focused on equity markets and commodities, we should not forget that there has also been action on the bond side, with interest rates gradually moving upwards globally over the past five years ( here 10 year government yields for Germany and US ). This may be seen as a … Continued

One of the more important messages from recent central-bank communication is that policymakers are becoming more hawkish again in response to the inflation risks linked to the war in Iran. As Bloomberg reports, the ECB is now openly discussing the possibility of rate hikes should higher energy prices start to feed into second-round effects and … Continued

Yesterday, we highlighted that the oil forward curve remains in backwardation, with December 2026 Brent prices still in the mid-$70s. Our conclusion was that the oil futures market is pricing a short-term shock rather than a lasting structural oil crisis. In other words, traders do not appear to believe that the current escalation will keep … Continued

When assessing the impact of the Iran war on financial markets, investors naturally focus on the spot oil price. But the more informative indicator is often the oil forward curve. Today’s graph compares the forward curve three months ago with today. While near-term oil prices have risen sharply, prices for delivery further out have moved … Continued

The performance of Austria’s 100-year bond since issuance is a striking real-life example of what can happen when investors underestimate duration risk. When the Austrian government issued the bond in late 2017 with a 2.5% coupon, falling yields pushed its price dramatically higher, eventually reaching 237. Today, with the yield at around 3.7%, the bond … Continued