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http://trackresearch.com/articles/the-morning-track-manic-monday/
It’s almost May and the key part for markets today is that almost means nothing. Pulling from the pop culture of 1986 maybe just as good a place to start as anything else – with the Fed hiking, USD strong, markets worried about geopolitics but happy enough. The month-end noise predominates in light markets as China and Japan are on holiday leaving Asia happy to consider the prospects of peace in Korea. The EM world continues to watch North Korea make all the right sounds, even as the US remains cautious over Kim Jong-Un’s latest pledge to dismantle his nuclear test site in May. The weekend news wasn’t horrible and the dribble of data from Asia and Europe good enough to keep equities bid, the USD bid, rates higher and yet push down commodities. The AUD leads the G7 lower this morning with commodity linked FX hurting as energy and metals slip. GBP continues under pressure to March 1 lows with the UK Home Secretary Rudd resignation tipping May’s cabinet towards a ha
rd Brexit stance. M&A maybe helping to contain some of the pain, as Sainsbury buys Walmart’s ASDA for GBP7.3bn. As for the EUR, the 5-Star leader says a deal with democrats is impossible. The data from China on PMI was better than feared, while the credit rise in Australia maybe enough with inflation to tip the RBA tomorrow to sound hawkish. The ECB drop in M3 gives room for more QE even as the CPI from Germany suggests steady pricing. The world is more focused on the mania ahead with US ISM, jobs and FOMC key drivers for volatility. Until then we are all watching oil and USD for clues. The USD remains capped at the 200-day m.a. and that matters just as the bottom in US S&P500 holds there. The overbought condition of both maybe worth considering as the technicals look more important than the fundamentals so far today. That is always the case for mania with too much hope and too little fear make for more risk than return.
The Morning Track manic-monday
- The Morning Track – Manic Monday by Bob Savagehttp://trackresearch.com/articles/the-morning-track-manic-monday/
It’s almost May and the key part for markets today is that almost means nothing. Pulling from the pop culture of 1986 maybe just as good a place to start as anything else – with the Fed hiking, USD strong, markets worried about geopolitics but happy enough. The month-end noise predominates in light markets as China and Japan are on holiday leaving Asia happy to consider the prospects of peace in Korea. The EM world continues to watch North Korea make all the right sounds, even as the US remains cautious over Kim Jong-Un’s latest pledge to dismantle his nuclear test site in May. The weekend news wasn’t horrible and the dribble of data from Asia and Europe good enough to keep equities bid, the USD bid, rates higher and yet push down commodities. The AUD leads the G7 lower this morning with commodity linked FX hurting as energy and metals slip. GBP continues under pressure to March 1 lows with the UK Home Secretary Rudd resignation tipping May’s cabinet towards a ha
rd Brexit stance. M&A maybe helping to contain some of the pain, as Sainsbury buys Walmart’s ASDA for GBP7.3bn. As for the EUR, the 5-Star leader says a deal with democrats is impossible. The data from China on PMI was better than feared, while the credit rise in Australia maybe enough with inflation to tip the RBA tomorrow to sound hawkish. The ECB drop in M3 gives room for more QE even as the CPI from Germany suggests steady pricing. The world is more focused on the mania ahead with US ISM, jobs and FOMC key drivers for volatility. Until then we are all watching oil and USD for clues. The USD remains capped at the 200-day m.a. and that matters just as the bottom in US S&P500 holds there. The overbought condition of both maybe worth considering as the technicals look more important than the fundamentals so far today. That is always the case for mania with too much hope and too little fear make for more risk than return.
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Robert Savage
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