Antipodean Capital Macro Strategy Daily Jan 25 - Markets limp into the weekend, with familiar themes – slowing data, US shutdown, trade tariff talks prolonging – failing to alter prices much.

Macro: PMI slowing, trade talk delays, US shutdowns, dovish ECB: Lots of differing themes last night in operation, but with relatively little impact on markets. Stocks closed flat but oscillated, US yields fell 4bps and the USD rebounded, in part and substantially due to a dovish ECB Pres. The macro picture remains cloudy, as further falls in the PMI data out of the US & EU indicated, but so far that isn’t “new news” and hasn’t been enough to push stocks substantially lower yet. Comments that the US & China are miles apart in their trade talks didn’t help sentiment, but again, hasn’t sharply dented stocks as yet either. We end the week with little US data of any note tonight.

Summary: Stock & bond yields fell somewhat last night, with negative press around tariff talks – Trade Sec Ross said the US & China were miles and miles apart – and the US shutdown offsetting a 60 year new low in jobless claims. US Markit PMI’s were mixed (Manuf up, Non Man softer), and in the EU German, French & EU composite PMI’s all were softer. The ECB recognised downside risks, quashing any EUR$ rebound of late.

New trades: None.
FX: Short $JPY at 107.50 risk 110. Long EUR$ at 1.1360 risk 1.1260 target 1.18. Short NZDJPY at 72 risk 75. Long JPYKRW at 9.85 risk 9.76 target 10.30. Bought $CAD at 1.3350 risk 1.3250 target 1.40.
BONDS: Long 2 units ASX Banks 5yr CDS at 54bps, target 140. Long NZ 10s short NZ 2s at 104bps risk 130bps target 50bps. Sold Portugal 10yr bought German Bund at 158bps, risk 110bps target 350bps. Bought US 10’s at 2.91% risk 3.1% target 2.6%. Sold HYG at 83.55 risk 85 target 80.
EQUITIES: Long ASX All Ordinaries Top 100, Short ASX Small Ordinaries at 0.81x ratio. Short US Banks Index at 93.25 risk 100 target 80. Stay short Dow Transports at 10375 risk 10800 target 8000. Bought Feb VIX at 20.2.
COMMODITIES. Long Silver short Gold at 83.9x risk 87 target 65. Long Silver 14.08 risk 13.85 target 14.80+. Bought Gold at 1243 risk 1230 target 1300. Sold WTI at 52.70 risk 54 target sub 49.