Arthur Jurus’ Post

📈 Market Warm Up (09/05/24): - 🏦 Market Trends and Bond Auctions:  - The rally in 10-year US Treasuries ended with a lukewarm response to a $42 billion bond auction.  - Yields rose to 4.483%, hinting at potential market volatility ahead. - 🌍 Central Bank Movements:  - European central banks, notably in Switzerland and Sweden, are ahead of the Fed in initiating rate cuts.  - Sweden's Riksbank cut rates for the first time since 2016, with more reductions expected later this year. - 🔍 Inflation Outlook and Federal Reserve Stance:  - UBS analysts expect US inflation to trend back to the Fed's 2% target, driven by moderating housing costs and consumer spending.  - Comments from Fed officials suggest a cautious approach, with no immediate rate cuts anticipated. - ☀️ Renewable Energy Growth:  - Renewables now exceed 30% of global electricity production, with significant contributions from solar.  - China dominates global gains in solar and wind capacity, reducing the global reliance on fossil fuels. - 📉 Economic Data and Forecasts:  - Recent ISM services data indicated contraction, suggesting cooling economic activities.  - Persistent inflationary pressures, evidenced by a high employment cost index, may keep the Fed from cutting rates soon. - 🗣️ Paul Donovan's Commentary:  - Critiques the Fed's backward-looking focus and discusses recent rate cuts by other central banks.  - Questions the effectiveness of current central bank policies against the backdrop of changing inflation dynamics. - 📘 John Authers' Commentary:  - Highlights the dangers of exiting stock markets entirely and the distortions caused by Buy Now, Pay Later schemes.  - Discusses current consumer finance trends and their broader economic implications. - 💹 Earnings Reports:  - Arm Holdings (ARM): $0.36 vs. $0.21 expected.  - Airbnb (ABNB): $0.41 vs. $0.23 expected.  - Equinix (EQIX): $2.43 vs. $2.66 expected. - 📅 What to Watch (10/05/24):  - US consumer sentiment survey from the University of Michigan.  - UK GDP for Q1 and industrial output for March.  - Japan's March current account balance and household spending. --- Financial Disclaimer: This summary is for informational purposes only and not intended as financial advice. Market conditions are volatile and subject to rapid changes. Investors should consider their financial situation and consult with a financial advisor before making investment decisions.

Market Summary Week Ending 01.10.2023 It was a mixed bag for global equity markets across the week, with positive macro-economic data being released for both the US & UK. However, market sentiment remains sceptical around the future direction of the major central banks, further to the potential threat of a government shutdown in the US. In the UK, it was a positive end to the week with data released showing that the UK economy grew slightly faster in the period since the beginning of the Covid-19 pandemic. Figures show that the UK economy is now 1.8% larger than it was pre-pandemic, with previous estimates showing a 0.2% decrease over the same period, in part thanks for a 0.2% growth in Q2 of this year. This latest release means that since the end of 2019, the UK has seen faster growth than many other developed nations, such as France and Germany. Despite the strong rally seen on Friday, both the FTSE 100 & 250 suffered losing weeks, with a 0.89% and 1.71% loss respectively. In the US, positive economic data regarding inflation was dampened by the threat of a government shutdown, after Republican House leaders failed to pass a short-term spending bill, boosting fears that Federal Lawmakers will not be able reach an agreement required to stave off a potential shutdown. The Personal Consumption Expenditure Price Index (PCE), the preferred inflation measure of the Federal Reserve, which excludes food and energy, increased 0.1% for the month to 3.9%; better than the 0.2% increase as expected by economists. As a result, the Dow Jones and S&P 500 ended the week down about 1.3% and 0.7%, respectively, with the Nasdaq bucking the trend, finishing the week around 0.06% higher in what has been a tough month and quarter for US indices. - Please note for this weekly summary, we focus on the major indices within the financial markets such as the FTSE 100 (UK) and the Dow Jones and NASDAQ (US) to provide a factual account of what has happened within a certain index. Performance figures quoted are factual from the previous week’s trading and this summary is for commentary purposes only. The performance of these indices is not a representation of an individual fund or portfolio. Past performance is no guarantee of future returns. The value of your investment can go down as well as up. You could get back less than you originally invested. https://buff.ly/46x7yjp #financialplanners #finance #investing

Markets Update Global Markets Recap: Last week, global equities took a tiny tumble while bond yields crept up. US markets remained as flat as a pancake, with the S&P 500 inching up by a mere three basis points. European markets couldn't muster much enthusiasm either, closing just a smidge lower.   Fed's Mixed Messages: The Federal Reserve released its May 1st meeting minutes, which were more hawkish than a hawk convention. However, Fed Chair Jerome Powell then played the dove, downplaying the likelihood of further rate hikes. Markets are now betting on just one rate cut by the end of the year. The 10-year US Treasury yield rose 5 basis points to 4.47% by Friday, spiking midweek thanks to a PMI reading that hit its highest level in two years.   UK Election Bombshell: UK Prime Minister called a general election for July 4th. Adding to the intrigue, UK inflation data showed a smaller-than-expected drop (CPI down to 2.3% in April from 3.2% in March). Smaller than expected, yes, but just a shade over target for the BoE and the lowest level in almost three years. Nonetheless, the snap election has pushed hopes of a rate cut to August at the earliest.   Energy Market Jitters: Crude oil prices slipped by nearly $2 to $77.25 per barrel. Over in Europe, gas prices jumped as concerns about Russian supply cuts resurfaced.   UK Economic Data: April showers seemed to have brought more than just flowers, as UK retail sales dropped by 2.3%, the sharpest fall this year. Household goods sales slid by 5.4%, and non-food store sales weren't far behind, down 5.1%. Even food store sales couldn't escape the slump, declining by 0.8%.   US Housing Market Woes: The US housing market hit a bit of a snag in April, with existing home sales dropping for the second month in a row. Sky-high mortgage rates and ballooning house prices have buyers thinking twice. Sales dipped by 1.9%, bringing the seasonally adjusted annual rate down to 4.14 million units. These April numbers likely reflect contracts inked a couple of months earlier when the 30-year fixed-rate mortgage was hovering just under 7%—not exactly a bargain basement rate. It seems potential homeowners have been finding it tough to commit when the financial hurdles keep getting higher.   Eurozone Business Buzz: May’s flash PMI survey data showed the eurozone’s business activity picking up the pace. The Flash Eurozone Composite PMI Index climbed to 52.3 from April’s 51.7, beating expectations. Services remained in the fast lane, while manufacturing showed slight improvement, although it's still stuck in contraction mode for the 14th month in a row.   China's Property Sector Lifeline: The People’s Bank of China threw another lifeline to the beleaguered property sector, unveiling a re-lending program worth RMB 300bn to help state-owned banks lend to local entities for snapping up unsold homes.   Japan: Japan decided to keep things zen with no major economic data releases last week.  

Multi Asset Tactical View - September 2023 Views in brief – Only a dent in the rally? "Global equities declined during August as better-than-expected US economic data dashed hopes that the monetary tightening cycle is about to end or even reverse. Despite receding inflationary pressures, key central banks in developed markets therefore remained hawkish. This stance was reinforced at the Jackson Hole summit, where Federal Reserve (Fed) chair Jay Powell reiterated that US inflation “remains too high” and that the central bank will either need to hold rates at their current level or even raise them to bring inflation down to the 2% target. Continued signs that momentum in China’s economy is stalling also undermined sentiment, with the nation seeing further troubling developments in its real estate sector. Hence developed markets equities performed less negatively than emerging markets. Global bonds were mixed. US bonds sold off, with 10-year yields touching the highest levels in almost 16 years, as the stronger than expected US economic data prompted speculation that US rates would stay higher for longer. The US also raised its debt issuance target for the coming quarter which led to further upward pressure on long-dated bond yields. In contrast, European bonds eked out small gains, helped by a late-month rally. High-yield bonds continued to outperform investment-grade debt. Our moderately constructive positioning in equity markets is primarily supported by persistent positive momentum and technical factors, whilst our fundamental outlook remains mixed. On the one hand especially expectations for productivity boosts due to artificial intelligence (AI) provide a possible avenue for sustained growth, while on the other hand further increases in longer term interest rates could provide more room for re-valuation. In the realm of fixed income, momentum nudges us towards a slightly cautious approach. However, from a fundamental standpoint, valuation considerations and appealing yield levels spark greater optimism. Within this context, Europe emerges as particularly enticing, prompting us to add to our fundamental assessment." (Gregor M.A. Hirt, Global CIO Multi Asset, #AllianzGlobalInvestors) #MultiAsset For fund distributors and/or professional investors only. Investing involves risk. Past performance is not a reliable indicator of future results. *** DIRECT ACCESS TO THE DOCUMENT (pdf) ***

Multi Asset Tactical View - September 2023 Views in brief – Only a dent in the rally? "Global equities declined during August as better-than-expected US economic data dashed hopes that the monetary tightening cycle is about to end or even reverse. Despite receding inflationary pressures, key central banks in developed markets therefore remained hawkish. This stance was reinforced at the Jackson Hole summit, where Federal Reserve (Fed) chair Jay Powell reiterated that US inflation “remains too high” and that the central bank will either need to hold rates at their current level or even raise them to bring inflation down to the 2% target. Continued signs that momentum in China’s economy is stalling also undermined sentiment, with the nation seeing further troubling developments in its real estate sector. Hence developed markets equities performed less negatively than emerging markets. Global bonds were mixed. US bonds sold off, with 10-year yields touching the highest levels in almost 16 years, as the stronger than expected US economic data prompted speculation that US rates would stay higher for longer. The US also raised its debt issuance target for the coming quarter which led to further upward pressure on long-dated bond yields. In contrast, European bonds eked out small gains, helped by a late-month rally. High-yield bonds continued to outperform investment-grade debt. Our moderately constructive positioning in equity markets is primarily supported by persistent positive momentum and technical factors, whilst our fundamental outlook remains mixed. On the one hand especially expectations for productivity boosts due to artificial intelligence (AI) provide a possible avenue for sustained growth, while on the other hand further increases in longer term interest rates could provide more room for re-valuation. In the realm of fixed income, momentum nudges us towards a slightly cautious approach. However, from a fundamental standpoint, valuation considerations and appealing yield levels spark greater optimism. Within this context, Europe emerges as particularly enticing, prompting us to add to our fundamental assessment." (Gregor M.A. Hirt, Global CIO Multi Asset, #AllianzGlobalInvestors) #MultiAsset For fund distributors and/or professional investors only. Investing involves risk. Past performance is not a reliable indicator of future results. *** DIRECT ACCESS TO THE DOCUMENT (pdf) ***

We have just published our Quarterly Equities and Multi Asset Outlook (Q4 2023) entitled ‘Landing in the dark’. For investment professionals only. Investors remain focused on the impact of ‘higher for longer’ interest rates. Given elevated interest rates, expectations of further demand contraction appear logical due to higher financing costs affecting consumers and corporates. Given the uncertain macroeconomic backdrop, we prefer investments where structural drivers are stronger than cyclical exposure and continue to favour long-term themes such as infrastructure, the low-carbon ecosystem, and innovation, including AI. Importantly, we still don’t believe this is the time to buy broad markets – selection remains key. In our Quarterly Equities and Multi Asset Outlook (Q4 2023), our Multi Asset and Equities teams offer insights into how they are navigating markets, as we all wait to understand where we will ultimately land. https://lnkd.in/eMirn-cF Capital at risk.

Our September market review is out👇 Our monthly market review has increasingly become a global rates review. September was no different, as the pendulum swung between the hawks and the doves. On balance, it was a month when the hawks took charge, confidence fell and equity markets took a hit. While rates may not go much higher, in the short term, whatever happens, we are digging in for the long haul, which has spooked markets. In September, the Bank of England followed the Fed, keeping rates on hold. However, the Fed made it clear that they were merely pausing, while the Bank of England was rather more ambiguous, although we appear to be in a holding pattern, what has been termed the Table Top mountain scenario. More broadly in Europe, rates were increased in Sweden, Norway and by the ECB, with Lagarde keen to emphasise that rates will remain high for as long as required. At the heart of today’s problem is inflation stubbornness. Eurozone inflation may be at a two-year low, but it is still at 4.5% and a long way from the 2.0% target. Unfortunately, it will not go away anytime soon with oil in the mid-$90s a barrel. Life will continue to get more expensive. The underwhelming economic data also reinforces this, with little sign of a recovery boost and too many uncertainties, such as the potential US government shutdown. As for recession, no economy is out of the woods yet - Bank of America may be predicting a soft landing for the US, but for Germany and the UK, there is a long way to go before they are anywhere near such a situation. With ten-year Treasury yields above 4.6%, markets are experiencing what John Authers terms a “gravitational downward pull.” Historically... https://lnkd.in/eyZKMS9K

Multi Asset Tactical View - September 2023 Views in brief – Only a dent in the rally? "Global equities declined during August as better-than-expected US economic data dashed hopes that the monetary tightening cycle is about to end or even reverse. Despite receding inflationary pressures, key central banks in developed markets therefore remained hawkish. This stance was reinforced at the Jackson Hole summit, where Federal Reserve (Fed) chair Jay Powell reiterated that US inflation “remains too high” and that the central bank will either need to hold rates at their current level or even raise them to bring inflation down to the 2% target. Continued signs that momentum in China’s economy is stalling also undermined sentiment, with the nation seeing further troubling developments in its real estate sector. Hence developed markets equities performed less negatively than emerging markets. Global bonds were mixed. US bonds sold off, with 10-year yields touching the highest levels in almost 16 years, as the stronger than expected US economic data prompted speculation that US rates would stay higher for longer. The US also raised its debt issuance target for the coming quarter which led to further upward pressure on long-dated bond yields. In contrast, European bonds eked out small gains, helped by a late-month rally. High-yield bonds continued to outperform investment-grade debt. Our moderately constructive positioning in equity markets is primarily supported by persistent positive momentum and technical factors, whilst our fundamental outlook remains mixed. On the one hand especially expectations for productivity boosts due to artificial intelligence (AI) provide a possible avenue for sustained growth, while on the other hand further increases in longer term interest rates could provide more room for re-valuation. In the realm of fixed income, momentum nudges us towards a slightly cautious approach. However, from a fundamental standpoint, valuation considerations and appealing yield levels spark greater optimism. Within this context, Europe emerges as particularly enticing, prompting us to add to our fundamental assessment." (Gregor M.A. Hirt, Global CIO Multi Asset, #AllianzGlobalInvestors) #MultiAsset For fund distributors and/or professional investors only. Investing involves risk. Past performance is not a reliable indicator of future results. *** DIRECT ACCESS TO THE DOCUMENT (pdf) ***

Multi Asset Tactical View - September 2023 Views in brief – Only a dent in the rally? "Global equities declined during August as better-than-expected US economic data dashed hopes that the monetary tightening cycle is about to end or even reverse. Despite receding inflationary pressures, key central banks in developed markets therefore remained hawkish. This stance was reinforced at the Jackson Hole summit, where Federal Reserve (Fed) chair Jay Powell reiterated that US inflation “remains too high” and that the central bank will either need to hold rates at their current level or even raise them to bring inflation down to the 2% target. Continued signs that momentum in China’s economy is stalling also undermined sentiment, with the nation seeing further troubling developments in its real estate sector. Hence developed markets equities performed less negatively than emerging markets. Global bonds were mixed. US bonds sold off, with 10-year yields touching the highest levels in almost 16 years, as the stronger than expected US economic data prompted speculation that US rates would stay higher for longer. The US also raised its debt issuance target for the coming quarter which led to further upward pressure on long-dated bond yields. In contrast, European bonds eked out small gains, helped by a late-month rally. High-yield bonds continued to outperform investment-grade debt. Our moderately constructive positioning in equity markets is primarily supported by persistent positive momentum and technical factors, whilst our fundamental outlook remains mixed. On the one hand especially expectations for productivity boosts due to artificial intelligence (AI) provide a possible avenue for sustained growth, while on the other hand further increases in longer term interest rates could provide more room for re-valuation. In the realm of fixed income, momentum nudges us towards a slightly cautious approach. However, from a fundamental standpoint, valuation considerations and appealing yield levels spark greater optimism. Within this context, Europe emerges as particularly enticing, prompting us to add to our fundamental assessment." (Gregor M.A. Hirt, Global CIO Multi Asset, #AllianzGlobalInvestors) #MultiAsset For fund distributors and/or professional investors only. Investing involves risk. Past performance is not a reliable indicator of future results. *** DIRECT ACCESS TO THE DOCUMENT (pdf) ***