Category: Daily Instagraph

US money market Funds have been seeing record inflows since the pandemic and reach new all-time highs in AUMs. This is not surprising with an overnight deposit rate above 4.5% and a 3 months T-Bill approaching 4.7%. Let’s not forget that these yields are nominal with an inflation rate running at 6.5% y-o-y and new … Continued

With the re-opening of the Chinese economy after the loosening of the Covid restrictions, significant pent-up demand by Chinese consumers can be expected. This should not come as a surprise as the Chinese consumer has restricted himself to the basics for almost three years, namely food and other staples. According to Pictet AM, household excess … Continued

Earnings growth of US companies is turning negative. This is actually a rare event : the last time it happened was during Covid-19 and it only occurred 5 times over the last 2 decades. According to star strategist Mike Wilson from Morgan Stanley the upcoming path of earnings is clearly negative. What this implies for … Continued

We can argue for a long about the resilience of the US economy in light of a hawkish Fed raising interest rates to fight inflation. Our base case remains however the same: an inverted yield curve will eventually lead to, at least, a mild recession. This in turn will contract demand for products of US … Continued

The spread between the US BBB-rated corporate bond yield and the 90-day US T-Bill yield is at a historical low seen only on 5 other occasions over the past century. We agree the fact the duration of the corporates is longer while the yield curve is inverted explains part of this phenomenon. However, we also … Continued

We are reading that we not the only ones to believe that European stocks are in for a period of outperformance against their US peers and to believe what we have seen over the last couple of months is only the beginning. In dollar terms, European equities have outpaced the US during three major periods … Continued

As European economies are slowing due to the energy crisis and the tighter monetary conditions, we start to see job cuts. Sometimes these decisions, for example at Philips, Credit Suisse or SAP, are partly driven by specific corporate decisions. What strikes us is that the overall employment market in Europe appears rather resilient, at least … Continued

European Value Fund is now back to positive performance territory over 1 year despite the dramatic unfolding of a major geopolitical event at our doorsteps. The energy crisis has been the main driver of the relative performance of European stocks against their US counterparts. As the market started to price in the falling gas prices … Continued

It increasingly looks like this has been one of the best starts of the year for European equities over the last decades. Short covering, early indications of peak inflation and falling gas/electricity prices due the mild winter can be read as the main reasons for the rebound of 17.5% of MSCI Europe since end of … Continued