Cross-Asset Views: US correction or cyclical bear market?

This 1st quarter undermined many of certainties built up at the end of last year. 1/ US exceptionalism, cracked by the DeepSeek episode, which calls into question American AI supremacy and the accumulation of capex (vs. ROI). 2/ Trump trades and the rosy “Trump bump” scenario next... political uncertainty is now at historical highs and tariffs will probably prove larger and more global than anticipated, pushing forward the pricing of a stagflationary US scenario. 3/ MAGA vs MEGA: in the face of the new Trump administration, the German fiscal and European military revolution suggest an unpreced...

Long BTP 10/40 vs OAT 5/40

T he market has been d epricing a big portion of the french political risk in the 10 Y OAT-Bund . However, PM Bayrou faces significant internal challenges and criticism, raising the risk of a no-confidence vote, which could destabilize the political landscape. Meanwhile, Italian PM Meloni emphasizes fiscal caution and avoids escalating tensions with the U.S., suggesting limited changes to Italy's public debt scenario. Given these dynamics, the OATs may underperform BTPs in the near term. Therefore, we propose a tactical trade strategy: enter a long position in the BTP 3.85% 10/40 ve...

BOJ and Fed to open the central bank ball