Category: DAILY INSTAGRAPH

Recall the pivotal ‘whatever it takes’ moment of 2012, when Draghi fought to preserve the EURO amidst the Euro crisis. Fast forward 12 years, and Germany, once an economic powerhouse, is now trailing behind the PIGS countries in growth, resembling a lame duck. What led to this decline? It’s a mix of structural hurdles, innovation … Continued

Bull equity market’s performance comprises two primary factors: valuation multiple expansions and earnings growth. Although the broader S&P 500 has reaped benefits from the former, earnings growth has remained subdued, particularly outside the tech mega-caps commonly referred to as the Magnificent 7. Notably, for the Mag 7, the combined forecast and actual first-quarter 2024 earnings … Continued

There’s a prevailing belief among investors that U.S. stocks consistently outshine their international counterparts. Over the past half-century, MSCI USA has indeed enjoyed sustained periods of dominance over MSCI EAFE, spanning from 3.3 years to 14.2 years. However, it’s crucial to consider three key points: Firstly, international equities have also had prolonged periods of outperformance … Continued

The Japanese Yen has fallen to 34 years low against the USD last Friday. The so-called carry trade – borrow Yen and invest in higher yielding assets in foreign currencies– simply remains too attractive for many investors to be ignored. A currency intervention by Japanese authorities may be in the cards to stop the Yen … Continued

One of our key investment themes centres around anticipated rate cuts this year, though expectations are undergoing a shift. US bond markets are witnessing significant changes, with interest rates experiencing notable increases since the year began, both in the short and long terms. The 2-year Treasury yield has surged back to 5%, while the 10-year … Continued

Today’s Piper Sandler graph reveals the tightrope walk between US interest rates and the equity market. Despite robust inflation figures, investors have remained complacent, until now. But let’s not mistake calm for immunity. With the 10-year bond yield hitting 4.6%, signs of strain are emerging, particularly for lower quality and pricier stocks. The tipping point … Continued

US credit spreads, as measured by the yield difference between investment-grade BAA corporate bonds and the 10-year US Treasury, currently stand at a three-decade low. Historical patterns reveal that such levels of market complacency regarding corporate default risk, coupled with an uptick in interest rates, have historically precipitated increased corporate defaults and a subsequent repricing … Continued

The CNN Fear & Greed Index takes the temperature in terms of investor sentiment in the US stock market on a daily basis. It is composed of seven indicators including market momentum, stock price breadth, put and call options and market volatility. The index was showing greed a month ago and is now back into … Continued

The current profit taking in tech ( Nasdaq down 6.8% over a month ) is due to a realization by investors that the Fed will not cut rates as quickly as hoped for in light of the hotter inflation data and stronger than expected economic data. Rate cut hopes for this year are down from … Continued

The US debt is currently growing at a 10% higher rate than the US GDP. Debt increased by more than 3 trillion USD over the past 12 months alone. At the same time, interest rates have significantly increased at a time where debt needs to be refinanced and more government spending is on the horizon … Continued