Macro Strategist, Saxo Capital Markets

Kay Van-Petersen

Macro Strategist

Saxo Capital Markets

Thematic (Sector/Industry)

Probably the next most important thing is actually not the Brexit, but the next few Fed hikes<ul><li>Whilst Jun is live, I think Jul or Sep are more likely with the second hike in Dec, those Fed minutes from last week left very little to the imagination. They were hawkish</li><li>Fed implied probability of two rate hikes by year end is too low at 25%, should be closer to 50. The street is behind the curve on this and/or does not believe it (ripples with 2015)</li><li>Where does the DXY go, given we got to 100.17 (Nov 30) going into just one rate hike in Dec last year? Where do US 10yrs go, given we are at 1.83% &amp; we were c. 2.30% in Dec last year?</li><li>Flash PMI themed week ahead, including key GDP readings out of Europe. UK will get 2nd GDP reading with mkt expecting +2.1% YoY</li></ul>

Probably the next most important thing is actually not the Brexit, but the next few Fed hikesWhilst Jun is live, I think Jul or Sep are more likely with the second hike in Dec, those Fed minutes from last week left very little to the imagination. They were hawkishFed implied probability of two rate hikes by year end is too low at 25%, should be closer to 50. The street is behind the curve on this and/or does not believe it (ripples with 2015)Where does the DXY go, given we got to 100.17 (Nov 30) going into just one rate hike in Dec last year? Where do US 10yrs go, given we are at 1.83% &amp; we were c. 2.30% in Dec last year?Flash PMI themed week ahead, including key GDP readings out of Europe. UK will get 2nd GDP reading with mkt expecting +2.1% YoY

Global Macro Take: WK 21 – The Fed To Hike Over The Next 3 Meetings [Jun 15, Jul 27, Sep 21]

<ul><li>Key close on DXY above 94.50 on a Friday, liquidating my thesis on a tactical USD liquidation phase. Seems like we’ve now had a very sharp V-shaped bounce from the pullback 2 wks back</li><li>If the strong USD trend continues, we’d expect risk-off to be the flavour of the moment with EM, Commodities &amp; equities in general set to decline</li><li>Check out the long NOKSEK SaxoStrats idea flagged by our Head of FX Strategy John Hardy – I like the thesis, it definitely worth doing some heavy lifting on this</li><li>Plus a few links to the Sohn Investment Conference where movers &amp; shakers such as Chanos &amp; Druckenmiller were talking their views </li></ul>

Key close on DXY above 94.50 on a Friday, liquidating my thesis on a tactical USD liquidation phase. Seems like we’ve now had a very sharp V-shaped bounce from the pullback 2 wks backIf the strong USD trend continues, we’d expect risk-off to be the flavour of the moment with EM, Commodities &amp; equities in general set to declineCheck out the long NOKSEK SaxoStrats idea flagged by our Head of FX Strategy John Hardy – I like the thesis, it definitely worth doing some heavy lifting on thisPlus a few links to the Sohn Investment Conference where movers &amp; shakers such as Chanos &amp; Druckenmiller were talking their views 

Global Macro Take: WK 20 – The US Dollar Just Won't Die

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

We mentioned in our previous report <a href="https://www.smartkarma.com/insights/national-assembly-4-year-cycles-its-impact-on-korean-construction-stocks" target="_blank" data-smartkarma-citation="insights:2812">National Assembly 4 Year Cycles &amp; Its Impact on Korean Construction Stocks</a> how the major Korean construction stocks on average tended to outperform the KOSPI index on absolute and relative to KOSPI three months leading into the election and underperform the KOSPI index on absolute and relative terms three months after each of the past four National Assembly elections in Korea.We believe now is a prime time to become more cautious on the four major construction…

We mentioned in our previous report National Assembly 4 Year Cycles &amp; Its Impact on Korean Construction Stocks how the major Korean construction stocks on average tended to outperform the KOSPI index on absolute and relative to KOSPI three months leading into the election and underperform the KOSPI index on absolute and relative terms three months after each of the past four National Assembly elections in Korea.We believe now is a prime time to become more cautious on the four major construction…

Warning on Korean Construction Stocks: Ruling Saenuri Party Is Crushed in National Assembly Election

FX Strategist

Greg Gibbs

Fundamental analysis of topical themes in FX

Amplifying Global FX Capital

Amplifying Global FX Capital was founded in 2015 and is fully owned by Greg Gibbs. It is a registered company both in Australia and Colorado, USA and is a licensed in Australia to provide financial services.

We are producing a regular trading view orientated macroeconomic analysis of topical themes in global financial markets, with a particular focus on foreign exchange. We invite you to view an “executive summary” of these reports in “AmpGFX Reports” under our “Research” menu.

These reports are drawn from the analysis of Greg Gibbs and inform the capital management he undertakes on behalf of the company. The trading performance is posted periodically on our website. We aim to build our company into both a research and capital management business. We are currently in the planning phase for managing capital for wholesale customers.

Greg Gibbs has spent his working life of more than 26 years in financial markets, beginning in 1989 at the Reserve Bank of Australia, after completing a Bachelor of Economics Degree (Honours) at the Australian National University. He has been a CFA Charterholder since 2005. He has worked in Sydney, Singapore, New York and London for major global banks and presented on foreign exchange markets to major financial institutions and companies around the world, and maintained a high profile in the financial media.

Before Amplifying Global FX Capital, Greg was the Head of Asia Pacific Market Strategy at the Royal Bank of Scotland based Singapore. He now resides in Breckenridge Colorado.

Macroeconomics

The recent rising trend in the JPY and falling trend in the USD have had a life of their own this year, unwinding excessive positioning built up from end 2012 to mid-2015 for the JPY and from mid-2014 until January this year for the USD.  These trend reversals have contributed to the volatility in global markets that were being buffeted by the upheaval in Chinese markets and commodity prices, and more recently by Brexit fears. The rebounding JPY added to risk aversion, while the falling USD boosted risk appetite, the feedback from a falling to USD to a rising JPY added to the churn and uncertainty.  However, the JPY and USD have started to stabilize in recent days and excessive positioning appears to have been significantly cleansed, allowing markets to see more clearly improving conditions in Chinese and EM economies and focus on the rebound in commodity markets.  Brexit fears are likely to remain heightened and indeed may intensify as we approach the 23 June referendum.  This may tend to keep risk appetite and USD/JPY contained below 110.  But investors may still tend to seek out EM and commodity currencies to avoid negative rates and record low yields in major economies.  Brexit fears have weighed on European currencies and we may see further gains in EM and commodity currencies against the EUR.

The recent rising trend in the JPY and falling trend in the USD have had a life of their own this year, unwinding excessive positioning built up from end 2012 to mid-2015 for the JPY and from mid-2014 until January this year for the USD.  These trend reversals have contributed to the volatility in global markets that were being buffeted by the upheaval in Chinese markets and commodity prices, and more recently by Brexit fears. The rebounding JPY added to risk aversion, while the falling USD boosted risk appetite, the feedback from a falling to USD to a rising JPY added to the churn and uncertainty.  However, the JPY and USD have started to stabilize in recent days and excessive positioning appears to have been significantly cleansed, allowing markets to see more clearly improving conditions in Chinese and EM economies and focus on the rebound in commodity markets.  Brexit fears are likely to remain heightened and indeed may intensify as we approach the 23 June referendum.  This may tend to keep risk appetite and USD/JPY contained below 110.  But investors may still tend to seek out EM and commodity currencies to avoid negative rates and record low yields in major economies.  Brexit fears have weighed on European currencies and we may see further gains in EM and commodity currencies against the EUR.

AmpGFX - Calmer USD and JPY, Weaker EUR, More Upside for EM and Commodity Currencies

Public Relations and Social Media Manager, Dechert LLP

Peggy Heffner

Public Relations and Social Media Manager

Dechert is a global specialist law firm

Dechert LLP

Dechert is a global specialist law firm.
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In an increasingly challenging environment, clients look to us to serve them in ways that are faster, sharper and leaner without compromising excellence. We developed a first-of-its kind legal project management department, which uses technology, people and processes to drive efficiency and deliver value for our clients.

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For the past several years, the U.S. Department of Labor (the “DOL”) has been in the process of revising the “investment advice” regulations that govern “fiduciary” status under the Employee Retirement Income Security Act of 1974 (“ERISA”). Revising these ERISA rules has been a high priority of President Obama’s administration for quite some time, and was the centerpiece of a policy speech by the President on February 23, 2015. These rules had not been meaningfully revised since 1975, notwithstanding the dramatic shift in the retirement market from defined benefit plans to defined contribution plans (such as “401(k)” plans) and individual retirement accounts (“IRAs”).

For the past several years, the U.S. Department of Labor (the “DOL”) has been in the process of revising the “investment advice” regulations that govern “fiduciary” status under the Employee Retirement Income Security Act of 1974 (“ERISA”). Revising these ERISA rules has been a high priority of President Obama’s administration for quite some time, and was the centerpiece of a policy speech by the President on February 23, 2015. These rules had not been meaningfully revised since 1975, notwithstanding the dramatic shift in the retirement market from defined benefit plans to defined contribution plans (such as “401(k)” plans) and individual retirement accounts (“IRAs”).

The Brave New Fiduciary World Has Arrived - Has the Department of Labor Found a More Ideal Balance?

United States

SPDR Dow Jones Industrial Average ETF Trust is an exchange-traded fund incorporated in the USA. The ETF tracks the Dow Jones Industrial Average Index. The ETF holds the 30 large-cap US stocks that represent the Index. This ETF is registered as a Unit Investment trust and pays a monthly dividend representing dividends paid by the underlying stocks. The ETF's holdings are price weighted.

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SPDR DJIA Trust (DIA US)

Global Macro Take: WK 21 – The Fed To Hike Over The Next 3 Meetings [Jun 15, Jul 27, Sep 21]

Probably the next most important thing is actually not the Brexit, but the next few Fed hikes Whilst Jun is live, I think Jul or Sep are more...

Kay Van-Petersen

Global Macro Take: WK 20 – The US Dollar Just Won't Die

Key close on DXY above 94.50 on a Friday, liquidating my thesis on a tactical USD liquidation phase. Seems like we’ve now had a very sharp...

Kay Van-Petersen

Warning on Korean Construction Stocks: Ruling Saenuri Party Is Crushed in National Assembly Election

We mentioned in our previous report National Assembly 4 Year Cycles & Its Impact on Korean Construction Stocks how the major Korean...

Douglas Kim

AmpGFX - Calmer USD and JPY, Weaker EUR, More Upside for EM and Commodity Currencies

The recent rising trend in the JPY and falling trend in the USD have had a life of their own this year, unwinding excessive positioning built up...

Greg Gibbs

The Brave New Fiduciary World Has Arrived - Has the Department of Labor Found a More Ideal Balance?

For the past several years, the U.S. Department of Labor (the “DOL”) has been in the process of revising the “investment advice” regulations that...

Dechert LLP

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