This weekly newsletter pulls together summaries of the top ten most-read Insights across Macro and Cross Asset Strategy on Smartkarma.
Receive this weekly newsletter keeping 45k+ investors in the loop
1. 2025 High Conviction Idea: The Case for a Rotation Out of India into Hong Kong – Part 1
- Risk reward favours this shift in allocation between these markets.
- Short to mid-term concerns on the Indian market warrant this strategic change
- Slowing revenue growth and less government spending leading to decelerating profits which is not yet reflected in market multiples
2. The Drill – The China Meltdown Is Ruining the Upbeat Trends in Manufacturing
- Happy Tuesday, and welcome back to our weekly commodity editorial, where we keep you updated each and every week on what’s going on in the world of commodities, energy, and the like!
- It’s hard to talk about commodities without talking about China these days, as we have seen a complete reversal in the Chinese macro scene after we scouted last week for the best commodity plays should the Chinese stimulus come through.
- After all, they used the same wording as they did back in 2008, and it was wise of markets to “cry wolf,” as China would need to publish actual stimulus plans and their size before markets chased the story.
3. A Hindenburg Omen in an Oversold Market
- What happens when an ominously sounding Hindenburg Omen occurs when the market is oversold? The notoriously unreliable Omen is said to have called “ten of the last three market corrections”.
- The market’s reaction to the FOMC decision added to the risk-off market tone. The Fed marked down the number of 2025 quarter-point rate cuts from four to two.
- Four of the five components of our Bottom Spotting Model have flashed buy signals. Two or more simultaneous buy signals have been good long entry points for traders.
4. Steno Signals #176 – Will 2025 be 2007 or 2021 all over again?
- Welcome to my weekly editorial, where I assess the big-picture macro landscape, explore potential risks, and identify the next narrative for traders.
- Last week, I kept getting pings, rings, and dings from traders eager to discuss whether inflation is poised to make a comeback following the fourth consecutive hot inflation report in the U.S. Admittedly, we’re trending around 3.5% inflation on an annualized basis, which doesn’t look great amidst a cutting cycle.
- Consequently, the market has started repricing the inflation outlook, with the near-term (2-year) outlook once again outpacing the 10-year inflation outlook in inflation swaps.
5. Positioning Watch – Everything you need to know about Fixed Income positioning before we enter 2025
- Hello everyone, and welcome back to our weekly positioning update – this week with a strong focus on the moves we are seeing in Fixed Income and forward-pricing at the moment and the subsequent positioning as we head into 2025.
- Markets continue to lean bearish on the Eurozone while upbeat on the US in equity terms, and likely for good reasons as macro data hasn’t given any good arguments as to why one should be upbeat on the Eurozone, and the signs we are getting on European growth in our nowcasts have yet to show up in actual releases – for now, it’s mainly the less China sensitive countries like Spain, Portugal and Greece that are performing macro-wise while Germany, France and Italy suffer.
- GDP growth is surprisingly strong in the first 3 whilst very weak in the latter 3, and given the latter’s weighting in European equity indices, it makes sense why we are seeing hedge funds being long consumer staples, health care and other defensives while scaling down bets on cyclical equities.
6. Walker’s Weekly: Dr. Jim’s Summary of Key Global Macro Developments – 20 Dec 2024
- US and China treasury yields highlight inflation control challenges, with the Fed’s rate cut fueling market uncertainty.
- Asia’s mixed monetary decisions saw Japan hold rates, while the Philippines’ cuts worsened currency pressures.
- China’s retail sales remain resilient despite lower growth expectations, contrasting with declining real sales in the US.
7. Speadbites: Food for Credit Market Thought as We Head Into the Holidays
- Global credit ecosystem remains stable, similar to 2024 outlook
- Tight spreads and low all-in yields support demand in credit markets
- Concerns about non-cash accrual companies in private credit portfolios and potential impact on risk distribution from public to private markets, but overall sentiment remains positive for credit markets.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
8. T.R.U.M.P | Dec 19, 2024
- According to Webster the word of the year is Polarization.
- Oxford have Brain Rot and Cambridge have Manifest. Collins have Brat, which was apparently ‘made famous by a Chari XCX album’ (me neither).
- Personally, just as Cozzy Livs (cost of living) was my favourite in 2023, this year really deserves to be ‘Word Salad’, although without Kamala it is unlikely to reappear anywhere near as much.
9. Thailand: Policy Rate Held At 2.25% (Consensus 2.25%) in Dec-24
- The Bank of Thailand unanimously maintained the policy rate at 2.25%, aligning with consensus expectations, citing alignment with economic potential and inflation within target expectations.
- Economic growth projections for 2024–2025 remain steady, but uneven sectoral recovery, particularly in manufacturing and SMEs, presents ongoing risks to sustainable recovery.
- Global economic uncertainties, credit growth trends, and the efficacy of government debt-relief programmes in supporting domestic demand and financial stability will influence future policy decisions.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
10. Monday Macro: Bumper Crystal Ball Time, Plus the US Equity Bulls Are Still Rampaging
- Over the last week, the FTSE ALL World equities index stalled slightly, losing 0.8% in value, with the FTSE ALL Share index losing a tad more, down a smidgeon under 1%.
- Tech stocks again outperformed, sending the Nasdaq 1.5% higher and taking the index to over 20,000 for the first time ever.
- The S&P 500 edged 0.5% lower, and the Russell 2000 ended the week 2% down. The Magnificent 7 hit new highs as the market-broadening trend evaporated.
