EMgist

Macro watcher since 2005. Ex-EM Debt Analyst. Synthesizer-trader of market narratives. “(+/-)” = Bullish/bearish over ST/M-LT). Personal views, not advice.

[EMgist @EMgist]

US elections: What the Biden-Trump Rematch Means for the US Stock Market - Bberg
SPX VIX https://t.co/8xQ50enaYq

[EMgist @EMgist]

France: Macron’s approval rating fell to lowest level since Dec 2018 - Elabe for daily Les Echos. 24% trust Macron to tackle problems, down 5 points from May

$EUR OAT CAC EWQ (-), EWI BTP (-/=)

[Bloomberg @business]

French president Emmanuel Macron’s approval rating falls to its lowest level since December 2018, according to a poll carried out after he called snap vote https://t.co/lfuqDQvjXA

[EMgist @EMgist]

France: Govt debt (excl. guarantees related to EFSF) will reach 112.1% of GDP in 2027, up from 109.0% in 2023. General govt debt-to-GDP ratio has become 3rd-highest in euro area after that of Greece and Italy - S&P Ratings

$EUR OAT CAC EWQ (=/-)

[EMgist @EMgist]

France election poll: Le Pen’s RN jump from 88 to 235, falling short of absolute majority. Macron’s centrists halved from 250 to 125-155 - Harris via Reuters

$EUR CAC OAT (=/-)

https://t.co/X4PzZUCQZX

[EMgist @EMgist]

France elections, EZ: Risk that France parliament may be led by far-right may focus attn on France’s dismal fiscal situation, which could shake up euro - Rabobank Foley

$EUR OAT CAC (=/-)

Dates:
June 30: Lower house first round
Jul 7: Runoff

[EMgist @EMgist]

Mexico: Most controversial reforms relate to judiciary, elections, autonomous regulators and energy sector

EWW MXN Mbono Mexbol (=/-)

https://t.co/keiqyewlCx

[EMgist @EMgist]

EM elections: India, South Africa eqty mkts has recovered much of post-election shock of diminished ruling govt while Mexico still reeling from larger mandate for ruling party - chart via Bberg Authers

$INDA $EZA (=), $EWW $MXN $Mbono $Mexbol (=)

[EMgist @EMgist]

Mexico: Fear of policy risk that AMLO will force 20 non-mkt friendly constitutional reforms up in Congress in his last month of his term given 1mth overlap with new Congress (just need to convince 4 opposition senators) - BAML via Bberg Authers

EWW MXN Mbono Mexbol (-)

[EMgist @EMgist]

Fed: 41% economist plurality see Fed signaling 2 cuts in June “dot plot,” while equal expect forecasts to show just 1 or no cuts at all - Bberg survey

61% need to see 3mths “positive core CPI” before cut - Bberg survey

*Baseline = Q4 cut(s) unless strong recession signs sooner

[EMgist @EMgist]

Week ahead:
Wed:
GE CPI
US CPI, Fed FOMC / SEP

Thu:
US PPI
$TSLA annual mtg

Fri:
JP BOJ

Watching: DXY (+/=), UST (=), JPY (=/+), EUR (-/=), SPX (v/=)

[EMgist @EMgist]

Fedspeak NLP Index: What 60,000 Headlines Say About the Fed’s Next Move - Bberg
https://t.co/5ArdOGXIFf

[EMgist @EMgist]

China eqty: Chart technicals are positive - Bberg
$MCHI $Shcomp $HSI (=/+), $KWEB $CHIR (=) https://t.co/JJX0ZOn0Ch

[EMgist @EMgist]

Week ahead - 17-20 Oct:
Mon/17: $BAC, ECB speak
Tue/18: $GS, US IP, China GDP+IP+Retail
Wed/19: EZ CPI, Fed speak+Beige book
Thu/20: US existing home sales
$MCHI $KWEB $CQQQ $EUR $UST (v/+)

[EMgist @EMgist]

Japan: MoF has $120-130bn to use for intervention before it has to start selling USTs and so it has another 5-6 shots if they intervene at $20bn rate it did on 22 Sep - Credit Agricole
$JPY $UST (v/-), $USD $DXY (v/+)

[investingLive @investingLive_]

JPY: MoF Has 5 to 6 more shots at a $20bn rate of intervention - Credit Agricole
https://t.co/9Fj0oSfj7h

[EMgist @EMgist]

UK: Four steps that the BOE could take to repair gilt market - HSBC Major via FT
$GBP $Gilt $Bund $UST (=/v) https://t.co/fAunVBMg4K

[EMgist @EMgist]

US-China tech: US restricts exports of advanced semiconductors, chips
$MCHI $KWEB $CQQQ $SOX $SMH (-/v)

[LongConvexity @LONGCONVEXITY]

Here's how new US restrictions on tech exports to China could undercut Beijing’s ability to develop wide swaths of its economy, from supercomputers and chips to advanced weapons https://t.co/d3tP1sOCUL via @bpolitics

[EMgist @EMgist]

Week ahead - 10-14 Oct:
Mon/10: Fed Brainard
Tue/11: Fed Mester, IMF WEO
Wed/12: Fed FOMC minutes, US PPI, ECB Lagarde
Thu/13: US CPI, EIA oil inventory
Fri/14: US Retail sales, UMich sentiment, bank earnings
$UST $EUR (v/=), $USD $DXY $SPX $XRT $XLF (v/-), $Oil $WTI $USO (v/+)

[EMgist @EMgist]

China Covid Cases Rebound ahead of Party Congress: Highest nationwide case count since 2 Sep. 8 cases in Beijing
$MCHI (=/v) https://t.co/MBAtBQr3qK

[EMgist @EMgist]

US eqty: G5 Credit Impulse printed at 20yr lows on fiscal drag + China de-leveraging + insufficient bank lending pickup. While analysts expect earnings to grow by 8% in 2023, Credit Impulse sees double-digit EPS contraction. Earnings will disappoint hard - @MacroAlf
$SPX (=/-)

[Alf @MacroAlf]

I'll soon update this chart on The Macro Compass, but the big picture still holds.

Analysts are just beginning to reckon that EPS growth will slow down.

Yet, my Credit Impulse metric suggests the magnitude of the drop in 2023 earnings is likely to surprise many.

[EMgist @EMgist]

China - Sell-side bank reasons for eqty optimism post-Party Congress:
Sharper focus on economy - Citi
Reintegration w/ ROW - BAML
Reduced conflicting policy goals - GS
$MCHI $KWEB $CQQQ $EEM (+)

https://t.co/2Y5Hcvc38C