Global weekly: Oil and Italy
This week, only two things seemed to matter: the agreement among oil-exporting countries to cut their oil production and the upcoming Italian referendum.
Bonds
Global weekly: Change in full swing
Bond and equity markets are anticipating and adjusting to the pro-growth agenda of presidentelect Trump. We also updated our growth forecasts.
US elections: the aftermath
Although it is too early to predict the course of Donald Trump’s presidency, there are a few broad indicators regarding the direction of the new administration. Trump’s key policies focus on immigration, taxes and trade. Economic growth is also expected to be emphasized. We expect policies in these areas may provide additional momentum for corporate earnings growth in 2017.
Global weekly: “President Trump” makes markets nervous
Donald Trump’s improving poll data hurt market sentiment this week. Equity prices fell and ten-year US Treasury yields moved lower, in response to safe-haven demand.
Global Weekly: Return to fundamentals
Equity earnings are recovering and market conditions are stabilising. We believe the US election is less relevant for investors than the improving fundamentals and continued attractiveness of stocks.
Global weekly: Markets not reacting to US elections
The expectations of a US interest rate hike in December and upcoming elections in the US and other countries have not had a big impact on markets so far.
Goodbye monetary policy, here comes fiscal policy?
This report highlights our key takeaways from the 2016 Annual Meetings of IMF/World Bank and IIF and related meetings in Washington DC. The general consensus in Washington was that monetary policy has been pretty much exhausted, at least in advanced economies. A shift towards targeted fiscal stimulus is welcomed, but effective leadership and poor fiscal fundamentals in many advanced economies act as constraints. The rise of populism (Trumpism, Brexit, Europe’s refugee crisis) is a key risk factor for the global economic outlook, as it leads to uncertainty, obstructs policy making and hurts globalisation, global cooperation and global trade.
Global weekly: Jittery markets
Equity market volatility has increased over the past few weeks and longer-term bond yields have been rising. There is wariness regarding US rate hikes and the possibility that other central banks may be beginning to be less accommodative.
Global weekly: Taper talk, not taper time
Bond yields briefly spiked this week, after news agency Bloomberg reported that the European Central Bank (ECB) is considering how to scale back or ‘taper’ its asset purchases. We do not expect the ECB to start tapering any time soon.
Global weekly: A turbulent week
Volatility has increased in the European financials sector, on market worries around Deutsche Bank. Energy prices rallied on supporting news from OPEC.