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Economy

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Sector Chart Pack: Webcast Follow-Up: Polls And More

The broad market took a significant step backward in April, as market jitters gripped investors, stoking fears of higher for longer monetary policy. However, our roundtable investor poll has demonstrated that the majority remain constructive on equities, and have plenty of cash ready to be invested, which could prolong the rally. Economic data is deteriorating while inflation is stubborn. However, so far, bad news is good news as many believe that a “Fed put” is still on.

US Equity Strategy by Irene Tunkel, Guy Russell
The Labor Market Is Cooling
Average hourly earnings growth slowed to 0.2% m/m in April from 0.3% m/m in March and came in below expectations. On a year-on-year basis, they decelerated from 4.1% to 3.9%, the lowest since June 2021 and below expectations of 4%. Nonfarm payrolls growth…
Daily Insights
ISM Services PMI Contracts In April
The ISM Services PMI largely disappointed in April. The headline index fell to 49.4 from 51.4, below expectations of a faster pace of growth. April’s contraction ends a streak of 15 consecutive months of services-sector expansion. Two alternative…
Daily Insights
What Inflation Rate Do People Prefer?
The Federal Reserve has a target inflation of 2%. But what level of inflation does the American public actually prefer? A recent NBER paper titled “Inflation Preferences” by Afrouzi, Dietrich, Myrseth, Priftis, and Schoenle surveyed one thousand…
Daily Insights
Better Data Could Boost EUR/USD In The Short-Term
The cyclical outlook is gloomy for EUR/USD. We subscribe to neither the soft-landing nor the no-landing view and expect a recession to occur in late 2024/early 2025. The pro-cyclical euro would suffer in a global downturn while a recession would support the…
Daily Insights
Commodities As A Late-Cycle Investment
According to BCA Research’s Commodity & Energy Strategy service, commodity prices typically rally toward the end of the business cycle. In the past six recessions, the S&P 500 peaked before commodity prices. While there is significant variability…
Daily Insights
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The Trading Range Holds

Some thoughts on this morning’s employment report and recent trends in US economic data.

US Bond Strategy by Ryan Swift
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A Conversation With Ms. Mea: Distinguishing The Signal From The Noise

Mainland residents’ investments in gold, other metals, and Hong Kong-traded stocks are a form of capital outflow. Chinese authorities will counter any excessive capital flight with stricter administrative controls. Thus, markets benefiting from these flows will likely be hurt.

Emerging Markets Strategy by Arthur Budaghyan
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US Politics In May And June

Investors should prepare for economic data to weaken even as policy uncertainty and geopolitical risk skyrocket ahead of the US election.

US Political Strategy by Matt Gertken
US Productivity Surprises Negatively
The preliminary nonfarm labor productivity estimate increased by an annualized 0.3% in Q1, below both the previous quarter’s 3.5% rate and expectations of 0.5%. Meanwhile unit labor costs increased by 4.7% annualized in Q1, a sharp acceleration from 0.4% in…
Daily Insights

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