Steve Miley (The Market Chartist)

Macroeconomic/ geopolitical developments The dominant event last week was the far higher than expected release for the US Consumer Price Index (CPI) data on Wednesday. Headline CPI rose 8.3% YoY ended August against expectations of an 8.1% rise. Core inflation (CPI excluding food and energy) leapt to its highest level since March at 6.3%, higher … Continued

Macroeconomic/ geopolitical developments Easing inflation fears seemed to be at work last week, possibly assisted by a midweek decline in oil prices to multi-month lows. Plus, the Fed’s “Beige Book” indicated that price increases were moderating in 9 of its 12 districts. Fed speakers Brainard and Mester also delivered comments that seemed to be more … Continued

Macroeconomic/ geopolitical developments The Monthly Fund Manager Survey from Bank of America showed that funds’ cash holdings are at their highest levels since 9/11, and equity exposure at the lowest levels since the 2007–2009 global financial crisis and recession. This can be viewed as a contrary indicator, meaning that there is plenty of cash to … Continued

Macroeconomic/ geopolitical developments The EU agreed on a partial ban on Russian oil. OPEC+ agreed on bigger oil-output hikes for July and August on Thursday, but still disappointed the oil market, which rebounded strongly, having previously sold off in anticipation of more aggressive hikes. EU inflation hit a new record high at 8.1%. Despite markets … Continued

Macroeconomic/ geopolitical developments Selling exhaustion in the equity markets saw recoveries last week, and a cross market shift to a “risk on” theme. This was helped by some positive forecasts from Macy’s, Ralph Lauren and Nordstrom. Fed Minutes pointed to hints of flexibility, helping the more positive outlook. Economic data was mixed, but the PCE … Continued

Macroeconomic/ geopolitical developments US CPI headline data year over year rose 8.3%, falling from March’s pace but not as much as expected, with consensus around 8.1%. Jerome Powell again stated that a hike of 0.75% was not something being actively considered, but was still a possibility. Possible easing of pandemic lockdowns in Shanghai, China brought … Continued

Macroeconomic/ geopolitical developments Disappointing earnings results from the tech sector last week, including Alphabet and Amazon, and concerning forward guidance from Apple eclipsed solid Meta numbers. The US core Personal Consumption Expenditures (PCE) price index YOY data, which is the Fed’s preferred inflation gauge posted its first deceleration in over a year, whilst the YOY headline … Continued

Macroeconomic/ geopolitical developments US headline CPI data leapt by 1.2% in March, with the year-over-year rise at 8.5%, above consensus expectations to a four-decade high. More hawkish comments from Charles Evans of the Fed (historically a dove) regarding accelerated rate hikes echoed the comments the prior week from another dove, Lael Brainard. The European Central … Continued

Macroeconomic/ geopolitical developments Hawkish comments from Lael Brainard of the Fed (usually more of a dove) regarding rate hikes and balance sheet normalization saw Bonds yields surge last Tuesday, with growth/ tech stocks leading the US stock averages lower. This was affirmed by Wednesday’s FOMC Meeting Minutes, which reinforced a more hawkish threat from the … Continued

Macroeconomic/ geopolitical developments The financial markets have been less dominated by the Russian invasion of Ukraine, as a lack of any significant escalation has seen a further shift towards more of a “risk on” theme for global risky assets (notably stocks) since mid-March. This has also been assisted by hopes from the Ukraine/ Russia talks … Continued

Macroeconomic/ geopolitical developments The financial markets have once more been dominated by the Russian invasion of Ukraine, but with a shift towards more of a “risk on” theme through mid-March. This has been driven by hopes from minimally positive signals from the Ukraine/ Russia talks. And, although there have been some upsetting impacts on civilians, … Continued

Macroeconomic/ geopolitical developments The financial markets have again been dominated by developments in the Russian invasion of Ukraine, with shifts between “risk off” and “risk on” themes. More punitive sanctions have seen European and U.K. stocks under particular pressure given the likely impact on global trade and the global economy. Global commodity prices have risen … Continued

Macroeconomic/ geopolitical developments The markets were dominated last week with shifts between “risk off” then “risk on” themes with the Russian invasion of Ukraine. The “risk off” theme on the initial invasion quickly shifted to “risk on”, as is often seen when conflict is predicted by markets and then finally breaks out, “sell the rumour, … Continued

Macroeconomic/ geopolitical developments The markets were dominated last week with shifts between “risk on” then “risk off” themes with conflicting reports regarding the potential for conflict starting between Russia and Ukraine. Reports of Russian troops withdrawing saw a “risk on” move earlier in the week, which was dismissed by Western statements regarding a potentially imminent … Continued

Macroeconomic/ geopolitical developments Another inflationary shock to the upside with the release of the US CPI data on Thursday that saw a print of 7.5% on an annual basis, above consensus estimates and at its highest level for 40 years, since 1982. The surging inflation data from the US (and globally so far in 2022) … Continued

Macroeconomic/ geopolitical developments A more hawkish tone from global central banks with the Fed shifting more hawkish through January, on Thursday we saw the Bank of England and European Central Bank both signal a more hawkish tone. The Bank of England delivered a 25bp interest rate hike as anticipated, but the vote was close for … Continued

Macroeconomic/ geopolitical developments We got the US Federal Open Market Committee (FOMC) interest rate decision, statement and press conference on Wednesday and although markets moved initially to a “risk on” theme after the statement, the press conference saw a “risk off” shift, as, markets interpreted comments from Fed Chair Jerome Powell as opening the door … Continued

Macroeconomic/ geopolitical developments Ongoing concerns of global inflationary pressures have seen an erratic start to the year for global markets, seen again last week. The US CPI data for December showed a 7% rise over a year, the highest inflation rate since 1982! Although this was priced in, it continues to fuel inflationary and higher … Continued

Macroeconomic/ geopolitical developments 2022 kicked off with a continuation of the latter 2021 theme of rising concerns of global inflationary pressures. This saw a rise in not just US bond yields, but in global bond yields, particularly in the major, economic centres. This higher yield theme was reinforced by the release of the Minutes from … Continued

Macroeconomic/ geopolitical developments Concerns that the Omicron strain of COVID-19 could contribute to supply chain disruptions and weigh on global economic growth have resurfaced over the past week. This has been driven by global medical institutions warnings of the more contagious aspect of Omicron the surging numbers of cases in many countries (for example the … Continued

Macroeconomic/ geopolitical developments Concerns that the Omicron strain of COVID-19 could contribute to supply chain disruptions and weigh on global economic growth have decreased over the past week. This has been due to positive sounding from vaccine providers and medical institutions regarding the efficacy of vaccines and that the variant could be less severe than … Continued

Macroeconomic/ geopolitical developments The standout event last week was the US CPI data on Wednesday, which came in much higher than expected at 6.2% year-over-year, its highest level since 1990. This fuelled ongoing, underlying inflation concerns, seeing global stock indices setback (then bounce), whilst global bonds pushed to higher yields. Tesla saw a steep decline … Continued

Macroeconomic/ geopolitical developments The Federal Reserve Open Market Committee (FOMC) met on Wednesday and as expected announced the start of tapering their monthly bond purchases by USD 15 billion later in November and December. However, the FOMC statement again highlighted an expectation for inflation to moderate and signalled no rush to tighten monetary policy. Markets … Continued

Macroeconomic/ geopolitical developments The busiest week of the US earnings season saw mixed earnings from Big Tech, with positives from Facebook, Microsoft and Google, and a positive announcement for Tesla, but significant misses from Apple, and Amazon. Further progress was seen on Biden’s proposed social infrastructure bill Despite losses after the Apple and Amazon releases, … Continued

Macroeconomic/ geopolitical developments Earnings season continued in the US last week, with positive earnings surprises across sectors, reinforcing solid results from the financial sector the prior week. But Snapchat parent Snap did disappoint on Friday, dragging the tech sector and Nasdaq lower to end the week. Fiscal stimulus hopes also helped the “risk on” theme … Continued

Macroeconomic/ geopolitical developments Although the FOMC meeting minutes on Wednesday did indicate that bond purchase tapering is likely to begin before the end of 2021, the minutes also revealed that Fed officials are currently looking to keep interest rates at or near zero for the next couple of years. Data has suggested that both supply … Continued

Macroeconomic/ geopolitical developments The “risk off” theme that had struck global financial markets earlier in September resumed into month-end as inflation concerns returned, alongside higher yield pressures. Global stock indices reversed previous recovery rebounds, looking technically vulnerable. Debt ceiling and stimulus uncertainty are also weighing on riskier assets. Although the federal government passed a short-term … Continued

Macroeconomic/ geopolitical developments The “risk off” mode that has gripped global financial markets in September due to growth and inflation concerns was intensified early last week with Evergrande contagion worries. However, these contagions fears have eased through the week, as have the growth and inflation worries, which have seen global stock indices post robust recovery … Continued

Macroeconomic/ geopolitical developments Ongoing growth and inflation concerns have left global financial markets in “risk off” mode, and still vulnerable to further erratic, “risk off” moves. Growth concerns have been sparked by three main factors: ongoing supply chain worries fuelling inflation fears Inflation worries putting the spotlight on Central Banks and in particular the Fed … Continued

Macroeconomic/ geopolitical developments The ongoing global spread of the COVID-19 Delta variant and the concerns regarding the new Mu variant, have impacted on growth expectations. In addition, ongoing supply chain worries have continued to fuel inflation fears and accentuate growth concerns. These factors leave global financial markets vulnerable to erratic, “risk off” moves. On Thursday … Continued