Market Sentiment

Italy Seen More Likely To Exit Eurozone Than Greece; Italian Bond Yields Surge

In an unexpected reversal of (mis)fortune, this morning Sentix writes that the Eurocrisis creeps back into the heads of the investors in a new way: it is no longer Greece, but Italy which is now the country that is most likely to leave the Eurozone within the year from the perspective of the more than 1,000 investors surveyed. "This development underscores the importance of the referendum to the Constitution in Italy on December, 4th."

5 Negative Factors For Oil Prices

With the value of crude oil price forecasting firmly established (as practically worthless), we will continue to monitor the global crude oil market to assess how events and trends will be impacting the crude oil price. At present we are bearish for crude oil, as we believe the following factors will be driving the oil prices in the short to medium term.

Shanghai B-Shares Unexpectedly Crash Over 6% In Last 90 Minutes Of Trading

“There’s no clear explanation on the sudden drop,” said Castor Pang, head of research at Core-Pacific Yamaichi Hong Kong. “But most investors are deeply concerned about the yuan’s depreciation and capital outflows as the yuan approaches 6.8. Overall market sentiment is very poor and selling in the B-shares index is spreading.”

"The Most Difficult, Treacherous Year" - What The Market Wall Of Worry Looked Like In 2016

2016 has been according to one buysider, "the most difficult, treacherous year" for the hedge fund community in recent history as a result of unprecedented shifts in market sentiment, choppy trading, low conviction, investor redemptions, illiquidity and  volatility month after month, which has left the hedge fund community exhausted and reeling even as the S&P hits all time highs.

US Futures Rebound, European Stocks Higher As Oil Rises

The summer doldrums continue with another listless overnight session, not helpd by Japan markets which are closed for holiday, as Asian stocks fell fractionally, while European stocks rebounded as oil trimmed losses after the the IEA said pent-up demand would absorb record crude output (something they have said every single month). S&P futures have wiped out almost all of yesterday's losses and were up over 0.2% in early trading.

JGB Carnage Sparks Contagion Across Global Bond Market

Disappointing fiscal stimulus, loss of faith in The BoJ, and increasingly headless-chicken policymakers has sparked a sudden and severe rush for the exits from Japan's government bond markets. 10Y JGB yields exploded from -30bps to almost 0bps in the last 4 days - the biggest crash in prices in over 3 years. This bloodbath is roiling the rest of the global developed bond market with Bund yield spiking (+12bps in last 2 days, almost back to 0), Swiss, UK, and Danish bonds are all blowing out, and Treasury yields up 14bps since Friday alone.

Kyle Bass Was Right: Here Is SocGen's Primer How To Trade The Biggest Yuan "Depreciation Wave" Yet

The new risk scenario for CNY is 8.0 (20% increase in USD-CNY). The caveat is that the pain threshold for the market appears to be much higher than before and the implications for the global financial markets will primarily depend on the speed of depreciation. We believe that it would take significantly more pressure on capital flows than what we have seen over the past few years, or an economic hard landing, for our risk scenario to unfold.

Don't Worry, You Are Not Alone: "No One Knows How To Price Brexit" Citi Admits

Whereas spot prices have stabilized, there appears to be little conviction among traders and other financial market participants about the course of exchange rates and asset prices going forward. Market sentiment remains tentative; small catalysts can be very disruptive. A common trading floor comment is: "No one knows how to price the Brexit scenario going forward."

Something Strange Emerges When Looking Behind The "Brexit" Bookie Odds

When one looks at the actual dynamics within the bookies, an odd divergence emerges: "Although Ladbrokes has received a higher volume of bets to leave the EU, those making a punt on remain were placing higher financially larger" - the average stake on a bet to remain was £450, compared to £75 on a bet to leave."