Euro And The Stock Market

Unlike other major currencies, the euro has a strong and persistent positive correlation with the domestic stock market. For Japan, the U.S. and the U.K., the correlation between the stock market and the currency has tended to be negative (or … [More.]

The “New, Normal” In EM Ex-China

EM economies ex-China are slowing to a "new, normal growth" phase, which will keep bulks and base metals under pressure this year and next. These economies join China in a broad-based EM slow-down, which will increase the supply-side slack in metals … [More.]

Euro Area: Potential For Upside Surprise?

Recent client visits uncovered that investors are uniformly bearish on Europe. What could go right? We offer two potential candidates for upside surprises in Europe: European banks have been hesitant to lend ever since the … [More.]

U.S. Equity Prices: Rout Over?

U.S. equity prices have stopped falling over the next last couple of days, but global growth headwinds will constrain the profit outlook. We retain our cautious bias. The recent drop in equity prices was sparked by weaker than expected growth … [More.]

(Part I) EM Credit Spreads: Unsustainable Divergence

EM sovereign and corporate credit markets have so far defied the selloff in EM equities and foreign exchange markets, but the odds of material spread widening are considerable. As G7 central banks have crowded out global fixed-income investors … [More.]