Category: Daily Instagraph

Today’s graph maps the EUR fixed income market by yield and outstanding market value. The largest part of the EUR bond market remains the sovereign bond market. Across all durations, govie’s now generate average yields above 3%. The yield pickup provided by Investment Grade bonds especially in the financial space appears limited for the additional … Continued

The mighty USD, as measured by the Bloomberg Dollar Index, has been weakening over the last months and is currently testing an important long term technical support against foreign currencies. We believe there are different challenges to the USD : 1/ the de-dollarization of the world with the political wish by several countries to diminish … Continued

Yesterday’s March US CPI report came in cooler than expected with headline CPI rising by just 0.1% mainly driven by some moderation in food and energy prices. Core CPI remains however uncomfortably high. Today’s graph from Arbion compares the inflation path we are currently seeing in the US with past inflationary periods. 2 conclusions: 1/ … Continued

US small caps are currently out of favour: the ratio of US small caps to US large caps is nearing March 2020 levels, a trough seen last time just before the Internet bubble burst in 2001. Over the last 10 years US small caps has underperformed large caps by a stunning 4% a year ! … Continued

The US regional bank Western Alliance Bank Corp announced yesterday an 11% drop in it deposit base during the first quarter. Its stock price fell another 12.3% yesterday on this deposit flight representing 5 bn USD, an amount equal to the book value of the bank with a market cap of 3.2 bn USD. Insured … Continued

Container shipping remains a good indicator for global trade and business activity. While it appears global container throughput has only fallen marginally year-on-year, North European ports are currently handling 20% less containers than a year ago. The last time we saw such a drop was during the financial crisis. As we can safely assume that … Continued

The US Purchase Manufacturing Managers’ Index came out yesterday at 46.3, in recession territory and its lowest print since 2009, aside from the early months of the pandemic. New orders declined substantially in the US economy. This is a clear message to those who ignore the recession signals sent from the inverted bond yield curve. … Continued

Mr Market believes that the regional banking crisis has done a good part of the job of the Fed in tightening monetary policy. At least this is what the market implied fed rates are telling us as they have noticeably decreased since the bank run on Silicon Valley Bank. This may prove too optimistic. First … Continued

5.13 trillion USD are currently invested into US money market funds. Over the last 2 weeks alone 238 billion USD have been flowing into these products! This is rational from an investor’s perspective who reduce counterparty risk with individual banks and receive higher yields in the funds than on bank deposits. However it puts the … Continued

Technology stocks are silently regaining their leadership in the stock market. They are being perceived as defensive as they are somewhat shielded from the current worries in the real economy and the banking sector. Nasdaq is up 14% year-to-date versus the broader index S&P 500 is up 4.9%. Valuations do not appear to play a … Continued