Kill Bill and More Good News
We are seeing a “risk on” mood flood over the markets currently. Which is giving some interesting chart developments.
Hong Kong leader Carrie Lim will be withdrawing the extradition bill, Hong Kong equity markets bounced over 4% on the news.
China has said they will meet in Washington in early October to discuss trade issues, giving some hope.
Boris is struggling as PM, but the market likes the idea of a postponement of deadline and taking no deal off the table. Seems new election is likely.
Oil prices bounced on news that Russia will comply with OPEC output agreement and U.S. added new sanctions to pressure Iran.
The Fed Beige book (running commentary on the economic situation in the U.S.) came out more optimistic on growth than expected.
Many of the higher risk markets we follow are putting in strong performances:
Emerging market FX
These all are positive signs for investors that perhaps the trade war negativity is priced in, and there is room for positive surprises going forward.
The Riksbanken in Sweden was more hawkish than the market expected and raised the forward looking guidance for possible rate hikes
The Norges Bank will meet later this month and the market is pretty split on whether there will be a hike on the 19th of September.
Maybe the Scandis Central banks know something the rest of the world doesn’t? (Weak currencies have an effect on small open economies)
Keep your eye on the following!!