The post-FOMC confusion spilled over into international markets, with both Asian and European shares retreating, alongside US equity futures, as traders are on edge ahead of the US-China trade talks taking place today and tomorrow.
One man’s toxic waste is another man’s golden goose. A new round of economic sanctions imposed on Russia last month by the U.S. is creating havoc in investment circles...
"As esoteric as all that is, it’s been the economic piece of copper that has been less more misunderstood in my view. Copper is China FAI, and China FAI is all about ghost cities."
"...emerging-market dollar debt has slid notably since the start of the year, the worst performance in a January-April period since 1995... and emerging markets equities continue to look most exposed to a further re-pricing in USD."
Apple turned net sellers (purchases-sales-maturities) of marketable securities for the first time in at least three years. This has profound implications for the market.
"If the first quarter’s volatility is a harbinger of something bigger, I think that you’re going to see a lot more trouble in the corporate market and the equity market."
As Asian and European traders return from holiday, sentiment is generally risk on, with Asia mixed and European markets and US equity futures in the green, unafraid that the Fed could throw a curveball later in the day.
Companies are citing that wages are rising (due to a tight labor market) and prices for raw materials like steel are rising. Both of these are being reflected in companies’ aims to increase prices of goods and services... inflation is coming.
The "synchronized global growth" narrative is now being capitulated against, and as such, the Dollar has recoupled with rates differentials because the US is again viewed as the world’s leading growth-story.
"This observation is at the core of the late-cycle playbook for owning commodities and why commodities typically perform the best when other asset classes perform their worst, particularly in relation to inflation..."
Whether it ultimately goes on to test the 2017 highs may be a completely different issue, but the stars are aligned for recent dollar appreciation to sustain for a few months...
