Senior Relationship Manager
Summary: Equities at record highs - Is there more room?
Good Morning
Equities continues their ascent and close at records, the Dow gains 0.36%, the S&P 500 0.35% and the Nasdaq +0.21%, Ger30 closes above 15700, breaking it’s wedge and now has room to the 16000 technically.All three US Indexes are at record levels.
Tesla gained 4% yesterday and today we are expecting earnings of DNB, Pepsi, JPMorgan, Goldman Sachs and First Republic Bank. Based on IBES data, a rise of 66% in overall earnings is expected for the 500 companies in the S&P 500.
According to Reuters calculations, the cost of hedging against a 3-standard deviation move in the SPDR S&P 500 ETF Trust is higher than about 90% of the time over the last five years.
US 10 year Interest Rates rise to near 1.4% and the USD Index to 92.25. Bitcoin remains in the 30k-40k range, currently at 32800. Gold and Silver can gain to 1806 and 26.20 and are a little removed from recent lows.
Besides the earnings, the US CPI should be the main event of the day and we continue to keep a close eye on central banks as the key driver behind the rally, also the US Senate has returned from it’s holiday and working on the infrastructure deal.
Local Start Date | Local Time | Country/Region | Indicator Name | Period | Reuters Poll |
13 Jul 2021 | 08:00 | Germany | HICP Final YY | Jun | 2.1% |
13 Jul 2021 | 08:45 | France | CPI (EU Norm) Final MM | Jun | 0.2% |
13 Jul 2021 | 08:45 | France | CPI (EU Norm) Final YY | Jun | 1.9% |
13 Jul 2021 | 14:30 | United States | CPI MM, SA | Jun | 0.5% |
13 Jul 2021 | China (Mainland) | Exports YY | Jun | 23.1% | |
13 Jul 2021 | China (Mainland) | Imports YY | Jun | 30.0% | |
13 Jul 2021 | China (Mainland) | Trade Balance USD | Jun | 44.20B | |
14 Jul 2021 | 04:00 | New Zealand | Cash Rate | 14 Jul | 0.25% |
14 Jul 2021 | 08:00 | United Kingdom | CPI YY | Jun | 2.2% |
14 Jul 2021 | 09:30 | Sweden | CPI MM | Jun | 0.1% |
14 Jul 2021 | 09:30 | Sweden | CPI YY | Jun | 1.3% |
14 Jul 2021 | 13:00 | Turkey | CBT Weekly Repo Rate | Jul | 19.00% |
14 Jul 2021 | 13:00 | Turkey | O/N Lending Rate | Jul | |
14 Jul 2021 | 13:00 | Turkey | O/N Borrowing Rate | Jul | |
14 Jul 2021 | 13:00 | Turkey | Late Liquidity Window Rate | Jul | |
14 Jul 2021 | 16:00 | Canada | BoC Rate Decision | 14 Jul | 0.25% |
15 Jul 2021 | 03:00 | South Korea | Bank of Korea Base Rate | Jul | |
15 Jul 2021 | 03:30 | Australia | Employment | Jun | 30.0k |
15 Jul 2021 | 03:30 | Australia | Unemployment Rate | Jun | 5.0% |
15 Jul 2021 | 04:00 | China (Mainland) | Urban Investment (YTD)YY | Jun | 12.1% |
15 Jul 2021 | 04:00 | China (Mainland) | Industrial Output YY | Jun | 7.8% |
15 Jul 2021 | 04:00 | China (Mainland) | Retail Sales YY | Jun | 11.0% |
15 Jul 2021 | 04:00 | China (Mainland) | GDP YY | Q2 | 8.1% |
15 Jul 2021 | 08:00 | United Kingdom | Claimant Count Unem Chng | Jun | |
15 Jul 2021 | 08:00 | United Kingdom | ILO Unemployment Rate | May | 4.7% |
15 Jul 2021 | 10:00 | Italy | CPI (EU Norm) Final MM | Jun | 0.2% |
15 Jul 2021 | 10:00 | Italy | CPI (EU Norm) Final YY | Jun | 1.3% |
15 Jul 2021 | 12:00 | Euro Zone | Reserve Assets Total | Jun | |
15 Jul 2021 | 14:30 | United States | Initial Jobless Clm | 10 Jul, w/e | 360k |
15 Jul 2021 | 14:30 | United States | Philly Fed Business Indx | Jul | 28.3 |
15 Jul 2021 | 15:15 | United States | Industrial Production MM | Jun | 0.7% |
16 Jul 2021 | 00:45 | New Zealand | CPI QQ | Q2 | |
16 Jul 2021 | 11:00 | Euro Zone | HICP Final MM | Jun | 0.3% |
16 Jul 2021 | 11:00 | Euro Zone | HICP Final YY | Jun | 1.9% |
16 Jul 2021 | 14:15 | Canada | House Starts, Annualized | Jun | 270.0k |
16 Jul 2021 | 14:30 | United States | Retail Sales MM | Jun | |
16 Jul 2021 | 16:00 | United States | U Mich Sentiment Prelim | Jul | 86.5 |
16 Jul 2021 | Japan | JP BOJ Rate Decision | 16 Jul | -0.10% |
(Refinitiv)
Bond. Long Bond(s)
With real rates being too positive, we see three scenarios: Opportunity to lock in rates at cycle high, government overreach to keep the economy afloat or a complete reset of the economy.
Steen Jakobsen,
Chief Investment Officer
Is a bond bull market ahead? Inflation still poses a risk for investors, but the moment for increasing duration to your portfolio may be approaching towards the end of the year, when central banks might be forced to cut interest rates.
Althea Spinozzi,
Senior Fixed Income Strategist
The furious rate hike cycle has brought gains in the US dollar, but with stagflation risks in Europe and the UK and weakness in the Chinese economy, USD may have more room to run. But a strong dollar could also have repercussions for US growth, emerging markets and commodity prices.
Charu Chanana,
Market Strategist
With the cost of capital rising painfully, stagflation fears are back, illuminating the fragile state of the green transformation, while giving a tailwind to nuclear power, and threatening the growth of AI-related stocks.
Peter Garnry,
Head of Equity Strategy
With supply tightness not only in energy but all commodities, the momentum in commodity prices may continue, pressuring central banks to lower real rates. That could be a good setup for precious metals, including gold, silver and potentially platinum as well.
Ole S. Hansen,
Head of Commodity Strategy
As the pandemic showed, even the US Treasury can experience seismic shifts. With the government increasing the pace of issuing bonds to support fiscal spending, the complex Treasury market and regulatory constraints could spark a liquidity event.
Redmond Wong,
Market Strategist
The tide has turned for bonds. Given the current yields, bonds have become an attractive investment, with added benefits including lower risk than stocks, increased diversification and a steady stream of income unaffected by economic changes.
Peter Siks,
Investment Coach