Insights

US stock markets took a breather after a 6-week ascent, shifting focus on to the upcoming election and its potential impact on the economy. In China, a slew of stimulus measures by the authorities is giving rise to cautious optimism, but challenges remain.

The Federal Reserve has shifted its focus from solely addressing inflation to balancing inflation control with supporting employment. Inflation, as measured by the personal consumption expenditures (PCE) price index, held steady in July at 2.5%, while the core gauge was 2.6%. Fed Chair Jerome Powell indicated that inflation has been largely tamed through high interest

The hike in interest rates by the Bank of Japan led to a sharp correction in USDJPY and an unwinding of the ‘carry’ trade. While this was expected, the effect was magnified by the release of softer than expected employment data in the US, which led to some panic selling. We believe some further volatility

Politics take centre stage in the markets. Meanwhile, the US economy is experiencing slowing growth, rising unemployment, and cooling inflation, suggesting imminent interest rate cuts. In China, efforts to stimulate local demand are falling short, and the banking sector is under significant stress.

US equities surge as S&P 500 hits 25 all-time highs this year, driven by tech stocks and semiconductor outperformance. Despite slower GDP growth, concerns arise over consumer fatigue and rising default rates, while labor market strength shows signs of softening. Gold’s prominence grows amid central bank purchases and other major economies initiate interest rate cuts.

After a robust 2023, the US economy is showing signs of stabilizing, with modest growth reported in the first quarter of 2024, indicating a possible tapering of economic expansion. Inflation remains persistent, prompting cautious monetary policy from the Fed.

Vladimir Ilyich Lenin, the leader of the Russian Revolution and the first head of the Soviet state, once said. “There are decades where nothing happens; and there are weeks where decades happen.” Are we witnessing one such week now? Please find enclosed our newsletter for April 2024.

Please find enclosed our newsletter for March 2024.

A slew of strong macroeconomic data – from GDP to employment to consumption – has given comfort to financial markets. At the same time, the immense possibilities of AI have propelled optimism in that sector to stratospheric highs. Despite this, many professional investors are wary, and watching out for ‘black swans’. On the other side

In 2023, US financial markets defied widespread expectations of an economic slowdown to generate one of the best performances in history. Looking ahead, projections seem a bit more evenly balanced, though the tilt is towards a ‘soft landing’. We look back at history, and examine the implications of the facts deviating from this dominant narrative.