Domestic Sentiment Monday Tuesday Wednesday Thursday Friday Events Mueller finds no collusion between Trump and Russia Week starts in sour mood after bad PMIs on both sides of Atlantic 3m10y yield curve inversion ID: 790879
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Slide1
13
w/c 25/3/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
Mueller finds no collusion between Trump and Russia;
Week starts in sour mood after bad PMIs on both sides of Atlantic;
3m/10y yield curve inversion
Yield curve inversion seen before recessions in 1990/1, 2201 and 2007/9
Yield curve inversion continues;
Fed nominee Governor Moore called on Fed to immediately cut rates by 50bps
Yield curve inversion continues
Risk
Off
Slightly positive
Slightly negative
On
On
Themes
Equities, GBP (GBPCAD); CADJPY
USD
Strong
Dovish Fed,
less QT, emollient Trump
Market forecasts cut this year
Final GDP
Core PCE
EUR
Weak??
Dovish ECB week 10
German Prelim CPI
JPY
Swing
GBP
Strong
Ongoing Brexit uncertainty
PM May’s strategy seems to be to allow indicative votes as means of threatening Brexiteers with soft Brexit, forcing them to vote for MV3
Parliament votes to give itself power to hold indicative votes
Indicative votes – all 8 fail;
PM May to resign once Brexit delivered
Current Account;
Final GDP;
Brexit Vote (WA only – fail)
CAD
Comm
Trade Balance
GDP
AUD
Comm
NZD
Comm
Cash Rate –
Inflation risk now skewed to downside; next move likely rate cut
CNY
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
Yield curve inversion continues, pressuring equities
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
API Inventories:
+1.9m vs exp -1.2m
EIA Inventories:
+2.8m vs exp -1.1m
Trump “very important OPEC increase the flow of oil”
Slide214
w/c 1/4/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
DST in UK, EZ
Yield inversion returns to normal and Fed says inversion was due to structural factors and is less of a recession indicator;
US Chamber of Commerce positive on China trade deal
Trump to meet China
VP Liu
on Thursday
More positive talk on China trade deal
Risk
On
On
On
On
On
Themes
USD
Strong
Dovish Fed,
less QT, emollient Trump
Retail Sales;
Manu PMI (no estimate but seen as positive)
Core Durable Goods
Average Hourly Earnings;
NFP
EUR
Weak??
Dovish ECB week 10
CPI Flash
est
ECB Mtg Accounts - voices concern about growth
JPY
Swing
GBP
Strong
Ongoing Brexit uncertainty
Manu PMI;
Indicative Votes – all fail
Construction PMI;
PM May to talk to Corbyn – softer Brexit mooted
Services PMI;
Chance of “No Deal” Brexit dies…long extension looks likely
CAD
Comm
(Un)
employment
AUD
Comm
RBA Rate Statement
Retail Sales
NZD
Comm
CNY
Manu PMI
Holiday
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
S&P shows best quarterly performance in nearly a decade
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
Venezuela’s main oil port closed due to lack of electricity; US considering additional sanctions on Iran
API Inventories –
+0.3m vs exp -0.4m
EIA Inventories –
+7.2m vs exp -0.7m
Slide315
w/c 9/4/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
US/China trade talks to continue this week
IMF cuts 2019 growth again, risks “skewed to the downside”.
EU/US trade tensions
Trump criticizes Fed again
Risk
Neutral
Off
Neutral
Neutral
On
Themes
USD
Strong
Dovish Fed,
less QT, emollient Trump
CPI (
headline
/
core
);
FOMC Mtg Mins – majority expect no rate hike in 2019
EUR
Weak??
Dovish ECB week 10
Rate and
Monetary Policy Statement – no new news
JPY
Swing
GBP
Strong
Ongoing Brexit uncertainty
Gov prepared to change Political Declaration
Legislation passed avoiding no-deal and seeking extension to Article 50
Emergency Brexit Summit (EU): Brexit delay until 31 Oct;
GDP;
Manufacturing Production
CAD
Comm
AUD
Comm
Westpac Consumer Sentiment – reaffirmed forecast of RBA rate cut in August
NZD
Comm
CNY
Trade Balance
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
Conflict in Libya
API Inventories:
+4.1m vs exp +2.3m;
EIA cuts world oil demand forecast in 2019 and 2020
EIA Inventories:
+7.0m vs exp +2.6m
OPEC - output cut compliance at 155% (135% expected)
OPEC Meetings
Slide4Week 15 Review
Brexit Extension
IMF pessimism/Fed dovishness
EU/US Trade tensions
Oil – supply problems; EIA cuts world oil demand forecast
Little movement in equities (rescued by Friday’s China Trade Balance), GOLD and oil.
Currencies were choppy and difficult to trade.
Slide516
w/c 15/4/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
Earnings season starts in the US – today, earnings mixed
NEC Director Kudlow says China talks making good progress
Trump – trade talks successful, deal likely by end May
Risk
Neutral/Off
Weak on
Weak on
Weak on
Themes
GOLD; GBP; JPY; AUD; Equities
USD
Strong
Dovish Fed,
less QT, emollient Trump
(Core) Retail Sales
EUR
Weak??
Dovish ECB week 10
Flash Manu and
Services
PMI
HOLIDAY
JPY
Swing
GBP
Strong
Ongoing Brexit uncertainty
Average Earnings Index
CPI
Retail Sales
HOLIDAY
CAD
Comm
CPI
Core Retail Sales
HOLIDAY
AUD
Comm
Monetary Policy Mtg Mins – no need for near-term move but would cut if inflation stays low and unemployment moves up
Un
(employment)
HOLIDAY
NZD
Comm
CPI
HOLIDAY
CNY
GDP
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
API Inventories:
-3.1m vs exp +1.7m
EIA Inventories:
-1.4m vs +1.6m;
OPEC Meetings
Slide6Week 16 Review
A quiet and short week with risk sentiment weakly positive.
No Brexit news as the MPs get some sun.
RBA statement moves to the dovish end of expectations.
Equities grind upwards very slowly. GOLD drops for reasons unclear. Oil does nothing.
Currencies remain choppy and difficult to trade.
Slide717
w/c 23/4/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
WIDESPREAD HOLIDAY
Earnings season (US) continues
US/China trade talks to resume in US and China over next 2 weeks.
Risk
Risk sentiment was modestly positive all week
Themes
Equities; AUD reversal (strength); EUR weakness; USD strength.
USD
Strong
Dovish Fed,
less QT, emollient Trump
Advanced GDP
EUR
Weak??
Dovish ECB week 10
JPY
Swing
Monetary Policy Statement – lowered GDP and CPI forecasts
Tokyo Core CPI
GBP
Strong
Ongoing Brexit uncertainty
CAD
Comm
Rate Statement etc
AUD
Comm
CPI: miss on all components. Citi, JP Morgan and RBC all calling for cut at next meeting
HOLIDAY
NZD
Comm
HOLIDAY
CNY
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
US to end all Iranian oil sanction waivers,
OPEC says they can cover the lost supply
API Inventories:
+6.9m vs exp 1.3m
EIA Inventories:
+5.5m vs exp +0.9m
Slide8Week 17 Review
A short week with risk sentiment modestly positive from Tuesday.
UK – MPs return and inter-party talks continue on Brexit.
The AUD takes a hit as CPI misses badly and banks call for a rate cut.
The S&P500 and Nasdaq close at all-time highs. It is more mixed in other territories.
In terms of FX trends, the USD rises and the EUR falls.
The major non-trending move is the fall of the AUD.
Slide918
w/c 29/4/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
Socialists win election in Spain, far-right breaks through
Risk
Neutral
Off
Holidays - calm
Off
On
Themes
Equities; AUD reversal (strength); EUR weakness; USD strength.
USD
Strong
Dovish Fed,
less QT, emollient Trump
Core PCE
Fed Funds Rate –
Powell downplays chances of lower rates.
Average Hourly Earnings;
NFP
EUR
Weak??
Dovish ECB week 10
Prelim Flash GDP
Holiday
JPY
Swing
----------------------------------------------------Golden Week---------------------------------------------------
GBP
Strong
Ongoing Brexit uncertainty
Super Thursday –
GDP and CPI forecasts up and down
CAD
Comm
GDP: -0.1%
(no expectation)
AUD
Comm
NZD
Comm
(Un)
employment
CNY
Manu and Non-Manu PMI; Caixin Manu PMI
Holiday
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
Trump tells OPEC to lower oil price
API Inventories:
+6.8m vs exp +1.5m
EIA Inventories:
+9.9m vs +1.3m
Slide10Week 18 Review
Another week partially becalmed by holidays.
The Fed was less dovish (i.e. more hawkish) than expected on Wednesday.
Global equities were essentially flat on the week, but only because of a surge on Friday.
The USD drops on the week but does not make a lower low, so we can say the upwards trend (on the weekly chart)
is intact.
The EUR drops on the week, making a lower low on the weekly chart, and as such maintaining its downwards trend.
The NZD is developing a downwards trend on the weekly chart, after another fall.
Slide1119
w/c 6/5/19
Fundamentals
Domestic
Sentiment
Monday
Tuesday
Wednesday
Thursday
Friday
Events
Trump threatens China tariffs, markets react predictably;
UK PM May says Labour Brexit deal close
Lighthizer
confirms sanctions to begin Friday as China reneging on commitments
Chinese Premier Lui He will travel to Washington for trade talks this week
Risk
US/China trade volatility
US/China trade volatility
US/China trade volatility
Themes
Equities, EURUSD, NZDUSD, USDTRY
USD
Strong
Dovish Fed,
less QT, emollient Trump
PPI
CPI
EUR
Weak??
Dovish ECB week 10
Partial Holiday
JPY
Swing
Holiday
GBP
Strong
Ongoing Brexit uncertainty
Holiday
GDP; Manufacturing Production
CAD
Comm
Trade Balance
(Un)employment
AUD
Comm
Retail Sales; Cash Rate – unchanged despite expectation
Monetary Policy Statement
NZD
Comm
Inflation Expectations
Cash Rate –
25bp reduction
CNY
Caixin Services PMI
Trade Balance –
Exports down, imports up
CPI
Equities
Strong
QT, Tax bill, earnings, less QT,
concerns about global growth
Gold
Swing
Oil
Crazy
Iran sanctions, OPEC+ production cut;
concerns about global growth
API Inventories:
+2.8m vs exp +1.2m
EIA Inventories:
-4.0m vs exp +1.1m