Manufacturing
The message from the German Ifo is that although business sentiment continues to weaken, the pace of deterioration slowed in September and appears to be in the process of bottoming. The Business Climate Index’s marginal 0.1-point decline to 85.7 delivered…
China’s oil demand growth will moderate to a still robust 4%-6% in the next six-to-nine months. We recommend that investors in China’s onshore and offshore stock indexes overweight energy producers.
Flash PMIs suggests that the tailwind to services from pent-up demand during the pandemic is easing and that although the global manufacturing downturn is bottoming, it is not meaningfully reaccelerating. In the case of the US, the Services PMI’s…
Collapsing German producer prices continue to indicate that inflationary pressures are moderating in the Eurozone. Total PPI declined by a record 12.6% y/y in August following a 6.0% y/y drop in July. While the annual decline mainly reflects the impact of…
Taiwanese export orders sent a disappointing signal about global manufacturing conditions on Wednesday, corroborating the message from Singapore’s NODX release earlier this week. The pace of decline in export orders accelerated to -15.7% y/y in August --…
Over the past few months a schism has emerged in the industrial metals complex. On the one hand, the Bloomberg Industrial Metals Index – which is composed of futures contracts on copper, aluminum, zinc, nickel, and lead – has been gyrating in a trading range…
Singapore’s non-oil domestic exports (NODX) sent a pessimistic signal about the global manufacturing cycle on Monday. The 20.1% y/y contraction in August is broadly in line with July’s 20.3% y/y drop and came in below consensus estimates of a 17.1% y/y…
While we are sympathetic to the view that the Fed could temporarily achieve a soft landing, we are skeptical that it could stick that landing for very long. Stocks could strengthen into year-end, with small caps potentially leading the charge. But the rally will fizzle out next year as the global economy begins to sink into recession.
The Global Manufacturing PMI suggests that although the global manufacturing downturn remains intact, the pace of deterioration slowed in August. The headline PMI index ticked up by 0.4 points to 49. In particular, the Output, New Orders, and New Export…
A global recession continues to be likely over the next 12 months. The impact of tighter monetary policy is slowly being felt. Government bonds look increasingly attractive as a safe haven.