Quarterly Outlook
Q4 Outlook for Investors: Diversify like it’s 2025 – don’t fall for déjà vu
Jacob Falkencrone
Global Head of Investment Strategy
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Market says glass is half full as we near crunch time on multiple fronts
Saxo Market Call
Summary: Today we look at the strong equity market recovery on Friday and its drivers, chiefly centred on hopes that US-China trade talks proceed in the direction of de-escalation, as sentiment related to the regional bank and private credit markets showed only marginal stabilization. Also, we refresh our impression of the precious metals markets after Friday's wild session and look at copper, crude oil and soybeans. Also, a look ahead at key US companies reporting in the coming days, US macro data that will be forthcoming this week, political developments in Japan and much more also on today's pod, which features Saxo Head of Commodity Strategy Ole Hansen and is hosted by Saxo Global Head of Macro Strategy John J. Hardy.
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Today’s Links
A new paper from a Samsung AI researcher suggests that there is a far efficient way to run LLM’s with only a tiny fraction of the parameters of the largest models like OpenAI’s ChatGPT. The implications are massive for the potential further progress of AI, but also possibly disrupting the huge incumbent players (though the Jevons paradox crowd will merely suggest that it means they can wring that much more intelligence out of their systems - I would lean more toward disruption). Eurointelligence.com actually cued me in on this story with its short “Deepseek on steroids” post, and also discusses the implications. Eurointelligence.com (sorry - each of their articles are just added to their blog-roll without a specific URL) also covers the risk of a rift between Germany and Poland in Poland’s “Own goal diplomacy”, suggesting that Poland’s request that Germany stop its investigation into the destruction of the Nordstream pipelines is an own-goal because it could empower Germany’s AfD, which is more often in favour of normalizing relations with Russia, at least vis-a-vis accessing its natural gas. Finally, a post analyzing the risks to incumbent players (banks!) in US credit markets from the advent of the GENIUS act, as stablecoin issues are circumventing rules that they not pay the equivalent of interest for holders of coins via other means. If this results in huge deposits leaving US banks, it could disrupt the flow of credit to the economy. Who said German stocks are boring? TKMS, or ThyssenKrupp Marine Systems is a spin-off of the former parent company ThyssenKrupp and went public today. It is a maker of especially naval surface ships and submarines with state of the art, quiet propulsion systems and thus is a cornerstone company for European defense. The shares got are getting an enthusiastic reception in their first day of trading, up as high as 107 euros per share after the opening price of 60 euros.Chart of the Day - TKMS (TKMS:xetr)
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