Quarterly Outlook
Q3 Investor Outlook: Beyond American shores – why diversification is your strongest ally
Jacob Falkencrone
Global Head of Investment Strategy
Dancing away from the brink into quarter end.
Saxo Market Call
Summary: Today we look at markets in a fine mood since the Friday close as treasury yields failed to punch into destabilizing territory and crypto arrested its decline and bounced back after testing below key levels as well. The next focus this week is on the risk of a US government shutdown starting this Wednesday, together with the key first week of the month economic data. This and much more on today's pod, which is hosted by Saxo Global Head of Macro Strategy John J. Hardy.
Listen to the full episode now or follow the Saxo Market Call on your favorite podcast app.
The Week Ahead in Macro Event Risks
I actually had this one ready on Friday and forgot to post - lots of data up this week and note the LDP leadership election in Japan which will determine who becomes the country’s next prime minister.
Today’s Links
FT Alphaville is on fire recently with some great links, including on on the sad End of Thinking as the modern world’s distractions, or something at least, is making the average person less able to think, according to widespread evidence. Another Substack FTAlphaville links to looks at “How concentrated ownership and automated manipulation reshape democracy.”
FTAlphaville also with a good dose of history on the rising impact of quants on the market as it discusses how the increasingly overlapping impacts of quant-driven hedge funds and prop-trading outfits have led to “quant quivers” and “garbage rallies” and could be leading us toward some “quant quake” if intertwining and highly correlated strategies implode simultaneously.
Luke Gromen of FFTT was a guest on the MacroVoices podcast discussing geopolitics, tariffs, the US fiscal situation and whether we are nearing a crisis points and much more. Always makes critical observations and has been spot on about gold.
It looks like Electronic Arts, the S&P 500’s top gainer on Friday with a nearly 15% one-day advance, may be taken private by a group of investors that include Saudi Arabia’s Public Investment Fund. Other listed companies in the gaming industry also mentioned in this article.
Chart of the Day - Nike (NKE)
Nike is the largest company reporting earnings this week - tomorrow after the market close. The company suffered an ugly markdown of its share price on a struggling business model under its prior CEO (replaced late last year) that pivoted excessively on a direct-to-consumer model, relying far less on third party wholesalers and retailers. Nike was also hit hard early this year by the US tariffs, as its production is in China and Southeast Asia. The last earnings report in late June engineered a huge jump in the share price as the CEO suggested the worst is behind for the company. A big test in the market’s confidence on this earnings report tomorrow. I somehow doubt that these shoes are contributing to the Nike’s near-term prospects, although I am the last person to notice what is in style. As well, Nike is collaborating with Kim Kardashian on a line of “activewear” products for women that launched last week - there could be guidance on the level of interest there. Technically, the stock just edged below the 200-day moving average, having not come anywhere near closing the gap since the prior quarter’s earnings.
And here is a 5-year chart of Nike for perspective.
Questions and comments, please!
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