Global Macro Perspectives
Some interesting and controversial comments and predictions from Marc Faber in today’s media reports: Bloomberg story: China New Village Makes Chanos See Dubai 1,000 Times. “It does not make sense for China to build more empty buildings and add to capacities in industries where you already have overcapacity,” Faber told Bloomberg Television on Feb. 11. […]
Baltic dry index fell 5.3% in the last week. Panamaxes outperformed the BDI, while Capesizes underperformed. For the time being dry freight weakness is due the slowdown of Chinese imports because of Chinese New Year and accompanying. This is also a reason for Capesize underperformance because this type of ships usually haul iron ore and […]
The initial jobless claims positively surprised declining 40.000 from the prior week and reaching 440.000. The consensus was at 467.000. It looks that combined with census hiring the positive cold continue. The markets yesterday closed positively yesterday on news that E.U. will back up Greece. The statement was obviously a product of lack of consensus. […]
One of the most important piece of data being reported this week is Chinese money supply. When giving a little thought to the meter, it gives a negative impulse to the markets turned both ways. If the growth continues we have asset bubbles forming and inflation threat; If growth slows down we have a threat […]
The focus on China continues. China statistic bureau reported China economy grew 10.7%. Bloomberg story: China’s GDP Growth Accelerates to Fastest Since 2007. The market focused on what wasn’t told in the report. Apparently the press release was missing the references to keeping “moderately loose monetary policy” and a “proactive fiscal policy”. The intense to […]
All the fuss today on a news that China maybe has started to slow down the credit growth. WSJ story: Bank of China to Take Steps to Rein In Loans. We have so many alerts coming from various data points and the market reacts violently on this kind of news. Equity was down, bonds an […]
The trading in Asia and Europe today was dominated by China export data. Apparently China exports rose 17.7% y-o-y for December almost reaching pre-crisis levels. The consensus was at 5%. In the same time imports grew 55.9% y-o-y, vs. the consensus forecast of 32.5% . The trade surplus reached $18.4 billion in December, about 60% […]
ISM Manufacturing Index for December came out at 55.9 vs. 54.8 consensus and 53.6 reading for November. Construction spending for November fell -0.6% M-o-M (-13.2% Y-o-Y) vs. -0.5% consensus and flat reading for October. The news of the day came out of China. China Purchasing Managers’ Index rose to 56.1. Bloomberg story: Chinese Manufacturing Grows […]
Equities Equity performance was impressive in recent month, down to the last trading day of the year. Thursday trading showed that the investors are not so confident that the upside will continue, revealing, maybe a moment of truth. Everybody is long because of fear not to miss further gains, but scared of a potential slip. […]
Well, I it is safe to say that again markets rallied on no improved fundamentals and on light volume during holiday time. The most profitable companies have lagged during this run. Bloomberg link: Most Profitable CEOs Get Smallest Gains in S&P 500. Anything could happen, the rally could last…. Chinese Premier Wen Jiabao again reaffirmed […]
Asian markets bounced on China industrial production figures. Apparently China’s factory output rose 19.2% in November vs. 18.2% consensus. Exports are running at -1.2% yoy, imports at +26.7% yoy. CPI at 0.6% yoy in November vs. -0.5% yoy in October. PPI rebounded from -5.8% in October to -2.1% in November YoY. New loans at Rmb295bn […]
I am starting a monthly strategy overview to have my strategy in one place and a to test accuracy of my views. Written revisions and accommodations would also contribute to my investment discipline. Equities I have been surprised by the market strength as the market rejected the Dubai turmoil as a correction catalyst. This has […]
U.S. GDP growth has got revised to 2.8% from previous estimate of 3.5%. Although the previous number (conspicuously high) helped to propel the market to new highs, revision doesn’t seem to raise any worries as U.S. equity futures are pointing on a higher opening. S&P/Case-Shiller Composite 10 edged higher 0.4% in September while &P/Case-Shiller Composite […]
Belisarius is annoyed with united horn blowing on dollar going further down and gold going further up. So annoyed it is on the brinks of placing a short gold and long dollar trade. I’ll cool down and think on that again. Such unified consensus always leads to opposite outcome. One of the reasons is (for […]
hina GDP grew 8.9% in third quarter vs. 9% consensus. All risky assets headed lower on the news, U.S. dollar higher. Puzzled, makes no sense. Bloomberg explanation: China’s Economy Grows 8.9%, Fastest Pace in a Year.
The media focus is on stimulus, monetary expansion. Chinese officials have already addressed those issues, at least verbal. In my view the depressed exports; over capacity; real estate bubble; credit boom are big issues and I am little bit skeptic on can China ride out of this recession smoothly. Correction today in Asia on concern of stimulus withdrawal.