Developed Countries

The S&P 500 rally broadened in July, lifting this year’s laggards. Surging long yields are altering the macroeconomic backdrop, as the market absorbs that monetary policy will stay restrictive for a long time. Yet, a move down in yields is more likely than a move up over a tactical horizon. Q2 earnings were better than expected but investors were unimpressed – the good news is already priced in. The market is overvalued and is close to being overbought, which makes it vulnerable to disappointment.

Some thoughts on this week’s bear-steepening of the Treasury curve and this morning’s employment report.

In this insight, we assess the prospect of the Swiss franc over the next six months.

The Supreme Court is a generator of certainty rather than uncertainty for US markets. In the event of a constitutional crisis, a court intervention will likely reduce volatility.