Developed Countries
The June ISM points to sluggish US manufacturing and reinforces long duration positioning amid peaking price pressures. The index rose modestly to 49.0 from 48.5 in May, with the rebound driven by slightly higher production and slower supplier deliveries due…
MacroQuant’s US equity z-score is dangerously close to the -1 threshold. Moves below that threshold have reliably coincided with equity bear markets in the past. As such, MacroQuant recommends an underweight on stocks, offset by an overweight on bonds and cash.
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Regional Fed surveys confirm sluggish US manufacturing and tame inflation, supporting long duration positioning outside the US. The June Dallas Fed Manufacturing survey missed expectations, rising to -12.7 from -15.3, still deep in contraction. New orders…
Tech-led momentum is driving the S&P 500 to new highs despite weak growth and rising cyclical risks. The rally has accelerated following a de-escalation in geopolitical tensions and ongoing hopes for positive trade developments. Momentum signals confirm…
Global inflation risks remain subdued, reinforcing a long duration stance across select DM government bonds. Our price pressure index shows moderate input price inflation outside the US and stable delivery times globally. Inflation blends…
The Treasury/OIS spread has exerted notable upward pressure on Treasury yields during the past year, but the factors driving the spread are now turning more favorable.
Investors should modestly underweight equities in their portfolios and look to turn more aggressively defensive once the whites of the recession’s eyes are visible. We think that will happen within the next few months.
Our Global Fixed Income, FX, and European strategists expect aggressive BoE easing amid disinflation and labor market weakness, supporting an overweight in Gilts and UK equities versus the euro area. While UK productivity remains sluggish, a recovery in labor…
A dovish early Fed nominee would increase volatility in rates and FX as markets reassess the credibility of US monetary policy. News reports indicate the Trump administration is considering nominating a Fed successor ahead of the end of Chairman Powell’s…