Senior Relationship Manager
Good Morning
Risk sentiment received a boost yesterday as yields came under pressure. The Bank of England opted for Yield curve control and there were some dovish comments out of the fed. Also, after 6 down days buyers of equities stepped in to pick up some shares. Volume was above average on US exchanges and US Indexes gained app 2%. Apple fell on a Bloomberg report that the company halted plans to boost production on low demand while Amazon could rise on an expansion into wellness business
Porsche AG shares will list on exchange today after Volkswagen priced shares at the top end of the announced range.
Lots of volatility again in FX where the pound had a strong day initially hitting the 1.0915 before falling to now 1.0778. EURUSD Also traded a range of more than 200 pips from 0.9530 to 0.9750 to now trade at 0.9660.
The USD Index dropped from 114.80 yesterday to 112.55 and is now at 113.50. Gold as well as silver rose sharply and have now fallen to 1642 and 18.60.
These sharp moves prove extreme uncertainty among market participants and also a willingness to step into risk at any sign of hope. We are heading into a very interesting Q4.
Continue to watch for any central bank or political comments that can cause sharp moves at any point in time, expected volatilities are double and more of the normal levels.
US: Jobless claims (weekly)
US: GDP (Q2, 3rd)
HK: Trade data (Aug)
UK: Mortgage Data (Aug)
Eurozone: Economic, Industrial & Services Confidence (Sep)
Germany: HICP (Sep, flash)
Spain: HICP (Sep, flash)
US: Personal Income & Spending (Aug)
US: PCE & Core PCE (Aug)
US: Chicago PMI (Sep)
US: U of Michigan Consumer Sentiment (Sep, final)
US: U of Michigan 5-10-year Inflation Expectations (Sep, final)
Japan: Unemployment Rate (Aug)
Japan: Industrial Production (Aug)
Japan: Retail Sales (Aug)
Japan: Housing Starts (Aug)
Japan: Consumer Confidence Index (Sep)
China: NBS Manufacturing & Non-manufacturing PMIs (Sep)
China: Caixin China Manufacturing PMI (Sep)
HK: Retail Sales (Aug)
India: RBI Policy Meeting (Sep)
UK: GDP (Q2, 2nd)
France: HICP (Sep, flash)
Germany: Unemployment (Sep)
Eurozone: HICP (Sep, flash)
AI: The good, the bad, and the bubble
While a deep recession may not be iminent thanks to central bank policy, interest rates will have to stay high for longer, and this will be accompanied by volatility risk from the unwinding of bubbles, especially within AI.
Steen Jakobsen,
Chief Investment Officer
The emergence of advanced AI systems is by far the most surprising event this year, turning everything upside down, while risks and benefits are debated. AI will also become an arms race between the US and China.
Peter Garnry,
Head of Equity Strategy
As China navigates global fragmentation, its cycle of technology application, productivity enhancement, and growth is threatened by US breakthroughs in generative AI, limited computing power, and geopolitical tensions.
Redmond Wong,
Market Strategist
Japan’s expertise in semiconductors and robotic integration could be the foundation of AI dominance. Combining two of this year's themes, Japanese equities and artificial intelligence, brings a wave of opportunities.
Charu Chanana,
Market Strategist
The AI fever has turned the technology into a darling, pushing crypto further into no-man’s-land. There are striking similarities between AI and crypto, and if these are to come full circle, AI won't be spared for bubbles.
Mads Eberhardt,
Cryptocurrency Analyst
Stocks related to artificial intelligence (AI) have appeared on investors' radars. Expectations are high, but it may be necessary to consider how to get exposure to AI in a diversified way.
Hans Oudshoorn,
Trainer Academy
The USD is on its back foot as markets celebrate an eventual Fed rate peak and steady long US yields. The stakes are even higher for the Japanese yen if longer major sovereign yield curves have to price in economic acceleration.
John J. Hardy,
Head of FX Strategy
While commodities, broadly speaking, have faced some tough months, a partial reversal during June could signal that the asset class is getting back on its feet with energy holding up and precious metals with upside potential.
Ole S. Hansen,
Head of Commodity Strategy
As inflation remains high central banks face hard decisions about whether they should keep hiking interest rates or stop. Meanwhile, the rise of AI creates bubble-like conditions that only make the decision harder.
Althea Spinozzi,
Senior Fixed Income Strategist