The impeachment inquiry into U.S. President Donald Trump and the ongoing protests in Hong Kong have made headlines for the past few weeks, but Ng said neither is likely to have much of an impact on global markets.
The short-term drivers of market performance are not always clear, but an improving outlook towards economic growth seems to be a clear contributor to the recent equity rally. Chief Investment Strategist Jim McDonald explains how we are positioning out portfolios in this environment.
The ongoing trade spat between the U.S. and China has been a rollercoaster ride of ups and downs, Ristuben said. He characterized the week of Nov. 4 as an up week, due in part to comments from the Chinese government that the two countries may be close to reaching an agreement to roll back existing tariffs on each other’s goods.
The Federal Reserve last week lowered rates for the third time over the past year. Interestingly, Chairman Jerome Powell said the Fed thinks interest rates are in a good place at the moment, telling investors that it may be time for a pause. We think this is a mistake by the Fed. Head of Fixed Income Colin Robertson explains.
Fresh off the heels of 25 basis-point rate cuts in July and September, the Fed lowered borrowing costs by another quarter of a percentage point on Oct. 30, dropping its benchmark rate to a target range of 1.50% to 1.75%. “The Fed has really been pushing back against the global economic slowdown driven by trade uncertainty between the U.S. and China,” Eitelman remarked, “and with this latest cut, it’s clear the central bank now feels it’s provided enough accommodation to counter-balance these risks.”
Third quarter earnings season is underway, and while analysts expect profits to be down versus a year ago, we see reasons for optimism. Head of Fundamental Equities Chris Shipley explains.
UK Prime Minister Boris Johnson successfully negotiated a draft divorce agreement with the European Union (EU) on Oct. 17, setting up a critical vote in Parliament on Oct. 19. The agreement with the EU effectively allows UK member Northern Ireland to stay in a common customs union, and prevents a hard border with the Republic of Ireland, an EU member.
Coming out of our monthly asset allocation meeting, we remain modestly overweight risk. Now is not the time to get too cautious. CIO Bob Browne explains.
Market Week in Review: Does the latest U.S. inflation report strengthen the case for another rate cut?
The latest round of trade negotiations between the U.S. and China kicked off Oct. 10 in Washington, D.C. So far, the talks have been positive, Robison noted, with the possibility that the U.S. will scrap a planned Oct. 15 tariff increase on Chinese goods. In addition, China may commit to purchasing more soybeans from the U.S., and the two nations may also strike a deal that would prevent currency devaluation.
The Institute for Supply Management (ISM)’s manufacturing purchasing managers’ index (PMI) slipped to a level of 47.8 in September, further extending the U.S. manufacturing sector’s slide into contraction. A reading below 50 indicates contractionary conditions, Robison noted, adding that the manufacturing sector had already dipped below 50 in August.
The recent dislocation in the market for repurchase agreements (known as the repo market) not only caught the attention of market participants, it prompted market intervention by the New York Federal Reserve. Peter Yi, director of short duration fixed income, explores the issue.