Sunset Market Commentary

The bond market rally from earlier this week took a breather this morning. With no more than two 25 bps ECB interest rate hikes discounted through summer and expectations for an additional Fed hike pushed back to July, one might have expected the case to push for more dovishness to have become less compelling, unless it would be backed by outspoken soft data.

USA: Tough Spell for the Manufacturing Sector Continues in May 

The slowdown in the manufacturing sector continues with little relief in sight. Nine consecutive months of falling new orders and order backlogs contracting at their fastest clip since the Great Recession reflect a sector whose near-term outlook is facing significant headwinds.

British Pound: A Silent Power Among the Majors

Despite coming under some pressure against its US counterpart lately, the British pound remains the best performing currency year-to-date. Will it continue performing well henceforth? With underlying inflation creeping up again in April, investors are hoping that the Bank of England will intensify its efforts to bring it to heel. But will policymakers rise to the occasion?

Here's What Silver Investors Need to Know

Observations over the years reveal that hedge fund managers tend to extrapolate current trends of financial markets into the future — just like most Main Street investors. In other words, hedge fund managers are just as much a part of the “crowd” as the little guy. So, this 2021 headline from the American Enterprise Institute […]

Oil Ignored Sour Risk Sentiment

Oil: Brent rose to around USD78/bbl yesterday as the oil market defied the overall setback in risk sentiment seen across equity markets and the rest of commodity markets. The weekly US inventory report showed further US selling of strategic reserves last week, albeit the pace of selling has slowed.

Nvidia Jumps 25% as Earnings, Revenue Beat Estimates

US stocks and bonds fell on Wednesday as the US politicians still didn’t seal a deal to raise the debt ceiling and the Federal Reserve (Fed) minutes showed dissatisfaction with the speed at which inflation slows.

GBP/USD Edges Lower, Markets Eye UK Retail Sales

GBP/USD continues its downswing. The pound is trading at 1.2340, down 0.20% and is at a one-month low against the US dollar.

Sunset Market Commentary

UK gilt yields one again caught the attention today. They initially add another  6.5-10 bps following yesterday’s ugly CPI surprise which will almost certainly force the Bank of England into additional tightening. This time though, the long end of the curve joined the short end, which could mean markets have taken a less pessimistic view on the growth implications of a tighter monetary policy.

Cliff Notes: Shifting Risks and Rhetoric

In the US meanwhile, the FOMC May meeting minutes highlighted the scale of the uncertainty clouding the outlook. The Committee clearly remains cautious regarding inflation risks, but increasingly these are being balanced by downside risks to growth – the result of both policy's effect on the economy as well as the additional tightening in financial conditions associated with recent bank closures and deposit flight.

Debt Ceiling Deal Awaits 'At the End of the Day'

US: Hopes of a deal to solve the debt ceiling rose yesterday, when Republican House Speaker McCarthy said a deal would get done at the end of day. It looks like negotiators are zeroing on a deal that would raise the debt limit and cap federal spending for a period of two years. The market reacted promptly with the gold price taking a nose dive.