In today’s briefing:
- April Themes and Thematic Portfolio Review
- Positioning Watch – Prepare for further action in JPY pairs
- HEM: Molting Hawk Feathers
April Themes and Thematic Portfolio Review
- A monthly review of how the markets and our themes are currently performing
- Analysing what went wrong and what went right in stocks and sectors
- Highlighting positions added or removed from the thematic investment portfolio
Positioning Watch – Prepare for further action in JPY pairs
- Hello everyone, and welcome back to our weekly positioning/sentiment overview!Equity sentiment has soured a bit since we last spoke, with broad US traded ETF fund flows sent back into solid negative territory after a stunning start to the year.
- While most of it is due to the tax-season in April, the hawkish repricing of global central banks has also played its part in normalizing the über-bullish sentiment in US equities, with markets now also biting their nails as an ECB June cut is no longer a certainty.
- Chart 1: Rolling monthly US ETF fund flowsAfter a couple of weeks of outflows from XLE, the reflation bet is back on track with around 500 mn.
HEM: Molting Hawk Feathers
- The front end has been sufficiently flattened due to continuous rate cuts.
- Despite the potential for limited cuts in the future, rate hikes are not anticipated.
- There’s a possibility that market pricing could exceed expectations before adopting a dovish stance.
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