Senior Relationship Manager
Summary: BoJ Spooks markets
Good Morning,
This morning The Bank of Japan – which had been widely expected to be boring as usual – caused traders on the wrong foot allowing the 10-year bond yield to move 50 basis points either side of its 0% target, wider than the previous 25 basis point band. The Yen rose significantly against he USD USDJPY fell from 137.50 to 133
Stocks fell on the news, GER 40 trades as low as 13700 before recovering to 13830.
Yesterday US yields jumped higher and equities remained under pressure, the 10 Year Yield rose to 3.7% and indexes fell, the Dow by 0.49%, the S&P by 0.90%, and the Nasdaq by 1.49%
EURUSD is trading at 1.06, GBPUSD at 1.2150 and Gold and silver remain strong at 1794 and 23.15.
The market seems wary of surprises and prone to jump on news as we saw this morning.
Tuesday 20 December
Wednesday 21 December
Thursday 22 December
Friday 23 December
US Durable goods orders
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.