Category: Daily Instagraph

Today’s graph from Goldman Sachs is a little present for central bankers to put under the Xmas tree. It shows indeed that their restrictive monetary policies by raising rates aggressively have shown effects. Core inflation, excluding the most volatile parts of inflation like energy, in the G10 countries ( ex Japan ) and DM markets … Continued

As of 19th of December, the S&P 500 is up 24.2% this year. Far from a broad rally, this market rally has been exceptionally concentrated this year on a couple of stocks. 71% of stocks have indeed been underperforming the index, the highest number on record. For 2024, investors need to remember that exceptional events … Continued

Yesterday stocks and bonds rallied after the Fed signalled interest rate cuts coming up next year. The Fed dot plot signalled 75 bps reduction of interest rates coming in 2024, a sharper fall than forecast a month ago. This morning futures in Asia and Europe are all up. We would not be surprised other central … Continued

Global benchmark brent trades near 73 USD per barrel, back to levels of June 2023 and 23% down since the peak in September. But hang on: we have a geopolitical polycrisis and OPEC is maintaining its production cuts at a moment where the US economy remains relatively resilient. Are less oil demand out of China, … Continued

If your time horizon while investing in the stock market was only one day, the probability of a loss in US equities was statistically 46% over the last 100 years. This is almost the same probability than tossing a coin and a random choice between a gain and a loss. If your investment horizon increased … Continued

Europa is the figure from Greek mythology who gave her name to the continent of Europe. She was a Phoenician princess who was abducted by Zeus and brought to Crete. European stocks are hidden and unloved like the princess. The valuation gap to US equities is now at an unjustified record high even when excluding … Continued

We have written this week that the current forward curve of interest rates is implying the Fed will cut rates by no less than 5 times 25 bps till January 2025. But what about Europe? Here investors are now also expecting drastic rate cuts by the ECB. 2 months ago, markets were still implying a … Continued

The Indian stock market is reaching new highs driven by a combination of economic resilience, Modi’s regional election victories strengthening his foothold and foreign buyers. At the same time, the Chinese stock market approaches a 5 year low as investors take flight from the aftereffects of Beijing’s isolationist Covid-19 policies, turmoil in the real-estate industry … Continued

As we are slowly entering the festive season, I believe my time is better spend reading finance books next to the fireplace instead of the extensive 2024 outlooks provided by eminent sell-side strategists from the major investment houses. If we look at their current S&P 500 forecasts for the end of 2024, they are, as … Continued

What a difference 1 ½ months can make in the bond market. According to the futures market of the Fed fund rates, investors are now discounting no less than 5 cuts of 25 bps by the Fed until January 2025. Mid-October investors were expecting only 2 cuts. The main reasons of this change are softer … Continued