Still Expecting Higher USD
It feels likely that markets will be waiting for more certainty on Fed hikes to push USD higher, especially given years of post-crisis overpricing of higher interest rates.
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Spanish Banks: More Regulatory, Political, Macro visibility Needed Prior To Further Consolidation
Fernando Rodríguez | Spain’s big banks BBVA, Santander and Banco Popular have recently announced they will gradually reduce their branch network. What is the significance of this move? Norbolsa analyst Nagore Diez Cerceda offers us some opinions.
Supply-Side Reform – Not Stimulus – Is Way Forward
Caixin | China’s banks lent out 4.67 trillion yuan in the first quarter, central bank data show – a figure that surpasses the record seen in the same period of 2009, when the authorities went on a spending spree in a bid to spare the country from the ill effects of the global financial meltdown.
A Price For All Seasons
BARCLAYS | New unplanned outages look unlikely to abate in the next couple of months, which have contributed to a tighter 1H16 oil market balance and new variability in the price forecast.
Spain Returns To The Polls: Fiscal Consolidation, Catalonia Key Challenges
AXA IM | Four months after the elections, negotiations to form a government officially failed and new elections will be organised on 26 June. However, it remains very unclear that their outcome will be more favourable, though probably conducive to a government as a third round of elections would be a tremendous failure. Fiscal consolidation and Catalonia’s independence will be top priorities.
Is The Fed’s QE Program Anti-Inflationary?
Benjamin Cole via Historinhas | Stanford luminary and economist John Cochrane is touting the fiscal theory of the price level (FTPL), in which the anticipated future of federal budget primary (operating) deficits is the key tell in present-day inflation. If the national budget looks re-inky, then inflation will result.
Non-Japan Asian Private Debt Is Number 1!
UBS | Non-Japan Asian private debt is now the highest in the world for any major region and is climbing toward 170% of GDP. As we have argued in our Debtopia thesis since 2013, rising leverage will increasingly result in diminishing marginal benefits to economies and profits when debt becomes excessive.
Cellnex: A Growth Investment In The Medium-Long Term
Cellnex Telecom is the leading independent operator of wireless telecommunications’ infrastructure in Europe. It is a growth investment opportunity, but it is currently trading at too demanding multiples. We would recommend to wait for some dips in the stock market to start to build up a position with a medium-long term view.
European Peace Dividend Ends Here
Obama called on Europe to increase its defence expenditure against ISIS in his last visit to the region in April. Analysts at Julius Bär Research share this opinion, stating that “European countries will most likely devise a number of security measures and reverse the trend of declining defence and security spending.” This is their note about terrorism effects on European defence economy.
Italian Banks Will Not Go Back to Fundamentals Completely
UBS | After a few weeks spent focusing on systemic concerns, earnings should offer a chance to go back to fundamentals. We are cautious into results as the recent rally left both banks trading on richer multiples and thus with limited protection against a quarter where underwhelming earnings could lead to consensus downgrades.