Markets Morning Newsletters

Powell signals the Phd’s were wrong, wrong, wrong – Macro Markets Morning 12 July 2019

on July 12, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • Fed chair Powell was joined by colleagues in suggesting a rate cut is coming this month with more to follow. But it was his criticism of the Phillip’s curve and that rates may not be as “accomodative” as thought which really suggests a series of cuts is coming even with the US economy doing okay.
  • Bond rates were still a little higher though as core inflation hit 2.1%, but that didn’t hurt stocks with the Dow above 27000 for the4 first time ever and the S&P 500 tanatlsingly close to 3000 with a record high close of 2999.91.
  • The USD was a bit better bid, gold offered – thanks 10’s – while oil was mixed.

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write – and lots and lots of chart – on markets each day you can sign up here for a trial

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Greg MckennaPowell signals the Phd’s were wrong, wrong, wrong – Macro Markets Morning 12 July 2019

The USD swooned, gold belted higher but rates suggest Powell wasn’t that dovish – Macro Markets Morning 11 July 2019

on July 11, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • A bit of a contrarian headline today because when I look at the Dec Fed Funds probabilities there isn’t that much of a change in the wake of Powell’s testimony. That suggests he was perfectly pitched – at least for market expectations.
  • But it also suggests what he said, the message he delivered, was largely priced. No wonder the S&P didn’t hold 3,000. Though the Nasdaq did close at a high.
  • What Powell did is reinforce expectations for the US and global central banking fraternity that rates across the globe are going lower and more monetary accomodation is coming. TINA and FOMO will drive markets from here.

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write – and lots and lots of chart – on markets each day you can sign up here for a trial

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Greg MckennaThe USD swooned, gold belted higher but rates suggest Powell wasn’t that dovish – Macro Markets Morning 11 July 2019

Locked and loaded, it’s all about Powell’s message now as market are ready – Macro Markets Morning 10 July 2019

on July 10, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • The Philly Fed’s Patrick Harker certainly pushed back against rate cuts Tuesday while his colleague from Boston Raphael Bostic was a little more ambiguous as he discussed the risks of running the economy hot. My sense is though they provided cover for Fed Chair Powell to walk back market expectations when he talks to lawmakers on Capitol Hill Wednesday.
  • Whether or not he does is critical to rates, bond, stocks, and foreign exchange markets which seem poised to get all funky if Powell builds on rate cut disquiet ignirted by the strong US jobs report from last Friday.
  • He may not of course, in which case stocks in the US – which had a decent recovery from futures lows – will catch a bid, while the offere in bonds might disappear for a while. The USD would drift lower should Powell chart that course. Over to you Chiar….

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write – and lots and lots of chart – on markets each day you can sign up here for a trial

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Greg MckennaLocked and loaded, it’s all about Powell’s message now as market are ready – Macro Markets Morning 10 July 2019

It really is about rates and Powell, markets want cuts – Macro Markets Morning 9 July 2019

on July 9, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • I am more convinced today even than I was yesterday that what Fed chair Powell says this week when he faces Lawmakers on Capitol Hill is going to be make or break for the bond and stock market rallies. Will he demur in favour of marekt pricing or push back against traders and POTUS by hinting the economy is not yet in need of stimulus.
  • Whatever he says it will be market moving, stocks, bonds, forex, and gold. For the moment the bet is just that a 25 bps cut is coming so a warning none may be in the offing would get things moving quickly and aggressively.
  • you can see that in the dip in US and global stocks Monday, in the pressure on gold, upward pressure on bond yileds, and the rally in the US dollar. Traders are waiting, but they are pensively poised..  

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write – and lots and lots of chart – on markets each day you can sign up here for a trial

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Greg MckennaIt really is about rates and Powell, markets want cuts – Macro Markets Morning 9 July 2019

Mmmm, non-farms set up a tantilising Powell message this week- Macro Markets Morning 8 July 2019

on July 8, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • US non-farm payrolls were better than expected and belled the cat on expectations of massive monetary policy moves in the US at this month’s FOMC meeting. But while 50 bps is out traders are still betting 25 is almost a certainty.
  • But the move in rates, and associated bond move was enough to spook stocks a little while the combination of data and moving fed expectations helped the US dollar get some of its mojo back. 
  • But stocks still had a great week, the USD is in a range, and bonds are still not far from recent lows – it all sets up a big chat between Fed chair Powell and Lawmakers on Capitol Hill this week .  

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write – and lots and lots of chart – on markets each day you can sign up here for a trial

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Greg MckennaMmmm, non-farms set up a tantilising Powell message this week- Macro Markets Morning 8 July 2019

Markets await US non-farms for fresh direction – Macro Markets Morning 5 July 2019

on July 5, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • If you are wondering when the axis of global markets will shift from New York the answer is not yet given the quiet market conditions we’ve seen over the past 24 hours with the US out for the July 4 celebrations.
  • Certainly Italian stocks continued to celebrate Rome’s apparent bullet dodging effort when it comes to sanctions over the deficit with the FTSEMIB up 1% in Milan. But otherwise things were fairly quiet save for a 1% fall in cruide.
  • Now for US non-farms and the markets verdict on whether it means a 25 point, 50 point, or no cut from the Fed at the end of the month.  

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write on markets each day you can sign up here for a trial

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Greg MckennaMarkets await US non-farms for fresh direction – Macro Markets Morning 5 July 2019

Stocks celebrate July 4 a day early – Macro Markets Morning 4 July 2019

on July 4, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • The physical market didn’t quit get there but the futures have. 3000 folks, that’s the big fat round number on the S&P 500 futures this morning as I write this note. The physical market had a good pre-holiday session with a 0.76% rally to close at another record high of 2995.82. The Dow and Nasdaq hit records too.
  • Bonds rallied too, Italy fairly roared – I’ve had a deep dive into bonds today. US 10’s are at 1.95%, Italy 1.61%! I know, :S.  But everything is relative.
  • Copper and oil are up on risk it seems and that sentiment is permeating forex markets too with the Aussie, Kiwi, CAD, and Scandi’s doing best. 

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write on markets each day you can sign up here for a trial

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Greg MckennaStocks celebrate July 4 a day early – Macro Markets Morning 4 July 2019

Gold surge, oil tank, bonds and stocks rally – Macro Markets Morning 3 July 2019

on July 3, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • Here comes TINA folks and it may not be long before FOMO comes belting down the track too. I say that as teh EU nominates a politician to head the ECB with the IMF’s Christine Lagarde slated for the top job. It suggests much more monetary expansion in Europe, and across the globe.
  • Bonds rallied, Italian ones substantially again, gold was bid through the roof, oil collapsed, Bitcoin had a roughly 10% range on the day and is now higher by 3%, and the S&P 500 had another record closing high with a gain of 0.3% to 2973.
  • The USD was mixed flat against teh Euro, down against the Yen and Aussie which rallied as the RBA cut and signalled a pause. Much to discuss. 

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write on markets each day you can sign up here for a trial

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Greg MckennaGold surge, oil tank, bonds and stocks rally – Macro Markets Morning 3 July 2019

Weak manufacturing undermines the Trade truce – Macro Markets Morning 2 July 2019

on July 2, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • Stocks loved the trade truce it seems with solid rises in Asia, Europe, and decent rises in the US where the S&P 500 posted a record close at 2694.33.
  • That monetary stimulus is coming was likely as important as the trade truce because the global manufacturing PMI’s were truly awful and in contraction territory for the second month in a row.
  • That meant that even though gold was pole axed as tensions eased assets like the Aussie, Kiwi, and Canadian dollars were hit along with copper as traders fret the globe is stuck in the mire regardless. That meant bonds didn’t sell off and even OPEC’s agreement to extend left Oil off its highs .

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write on markets each day you can sign up here for a trial

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Greg MckennaWeak manufacturing undermines the Trade truce – Macro Markets Morning 2 July 2019

Risk is bid as trade War glasnost breaks out – Macro Markets Morning 1 July 2019

on July 1, 2019

Morning folks – Welcome to McKenna Macro’s Market Mornings.

In a rush? Here’s the key takeaway

  • There is one big question as we start the week. Does the fact the trade war didn’t get worse and that talks have restarted mitigate the reality that the global economy is slowing, that there are still substantial tariffs on China in place, and the reality too that President Trump said the the US is in no hurry to resolve the issues. Indeed China said 90% may have been agreed but the 10% is what matters.
  • For me this is the extend and pretend base case which can see bond yields and stock prices pop for a bit but then fade in time as the reality the outlook is still a little parlous remains intact.
  • Asia is likely to be a little cautious awaiting confirmation from the US as to which way to jump.

Now,  let’s dive in to this morning’s newsletter. 

And for non-subscribers, If you want to have a trail of the daily subscriber service to get this and the 3000 odd words I write on markets each day you can sign up here for a trial

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Greg MckennaRisk is bid as trade War glasnost breaks out – Macro Markets Morning 1 July 2019