The Pound Sterling earlier struck a 10-month peak versus the US Dollar, largely due to a weakened greenback after the Fed’s unexpected outlook on inflation. Yesterday, as largely expected, the Fed left the benchmark lending rate at the existing level; however, it’s inflation forecast was not as optimistic as it had been in the past. For investors, that perhaps meant that the Fed would maintain the status quo for a longer period of time, and the possibility of a 2017 rate hike is now diminished. The removal of a single word, “recently,” from the statement suggested that the Fed’s FOMC might not consider that the consumer price slowdo...
UniCredit announced it has been the victim of a security breach in Italy due to unauthorized access through an Italian third party provider to Italian customer data related to personal loans only. A first breach seems to have occurred in September and October 2016 and a second breach which has just been identified in June and July 2017. Data of approximately 400,000 customers in Italy is assumed to have been impacted during these two periods. No data, such as passwords allowing access to customer accounts or allowing for unauthorized transactions, has been affected, whilst some other personal data and IBAN numbers might have been accessed. Un...
The US Dollar underperformed in Asian trade as regional investors took their turn to respond to what has been an FOMC policy announcement that the markets have interpreted as dovish. The Australian and New Zealand Dollars duly rose, reveling in support from yield-seeking capital flows as US Treasury yields edged down alongside the greenback. From here, a quiet European data docket is likely to see traders looking to the US durable goods ordersnumbers for direction cues. An increase of 3.7 percent is expected, the largest in eight months. US economic news-flow has increasingly improved relative to baseline forecasts recently, opening the...
After many years of underperformance, emerging markets are shining in 2017. We can see signs of improving economic growth in many parts of the developing world. This rebound has benefitted multinational giants that derive a significant portion of their sales from emerging markets. About the Company Headquartered in London, UK, Unilever PLC (UL – Free Report) is a multinational consumer goods company. They employ ~169,000 people. The company has a huge portfolio of more than 400 well-known brands including Dove, Lipton, Knorr and Ben & Jerry’s. Emerging markets account for about 57% of their sales. Seven out of every ten househ...
Deutsche Bank shares tumbled 4% on Thursday after reporting better than expected earnings, driven by provisions and dramatic cost-cutting, more than offset however by a sharp drop in overall company revenue which slumped to the lowest in three and a half years, as Investment Banking revenue slumped 16%, while FICC tumbled a whopping 12% Y/Y and 30% Q/Q, with CEO John Cryan taking a page out of the Goldman playbook and blaming “muted client activity.” The biggest German bank said Thursday net income was stronger than expected €466 million ($548 million), compared with €20 million for the same period a year earlier, while Q2 pre...
Given several years of diverging returns between U.S. and emerging market (EM) equities, it should come as no surprise that EM equities currently trade at a discount to U.S. equities. The size of that discount, however, is something that we feel is not being fully appreciated by many investors. As of June 30, the MSCI Emerging Markets Index traded at a 14.6x price-to-earnings (P/E) ratio, while the S&P 500 Index was at 21.9x earnings—a 33.5% discount.1 This is one of the largest valuation gaps between the two gauges since 2005. Remember the Last Time This Happened? Investors who allocated to EM in 2005 likely recall those days f...
If you spend enough time observing the market you will realize that action and reaction cause most of market movements. If you take a closer look you will see that three names seem to always appear close to each other when you read your daily market news. The US dollar, better known to traders as USD gets to be linked to gold very often. In the mix, we also throw their third friend; US interest rates. Let’s take a look at how these three amigos seem to always be pushing each other around. Interest Rates and the USD Now the U.S. Federal Reserve, we’ll go on calling it the Fed, decides on interest rate movements in the United States. It ma...
The trend remains your friend if financials have been overweighted in your portfolio. Measured by one-year performance, this sector is red hot in absolute and relative terms, based on a set of proxy ETFs. Tech is a close second for one-year sector returns. Goldman Sachs forecasts that the pair will hold on to their leadership positions in the near term. “Growth will drive technology share prices higher while change in growth will support the performance of financials,” David Kostin, a strategist at the bank, wrote last week. “We expect both sectors will outperform going forward, but for different reasons. The tech sector will benefit ...
AstraZeneca (AZN) announced progression-free survival results for the Phase III MYSTIC trial, a randomized, open-label, multi-center, global trial of Imfinzi monotherapy or Imfinzi in combination with tremelimumab versus platinum-based standard-of-care chemotherapy in previously-untreated patients with metastatic1st-line non-small cell lung cancer. The combination of Imfinzi and tremelimumab did not meet the primary endpoint of improving PFS compared to SoC in patients whose tumors express PD-L1 on 25% or more of their cancer cells. As a secondary endpoint, although not formally tested, Imfinzi monotherapy would not have met a pre-specified t...
As a portfolio manager, I start each morning by consuming copious amounts of a heavily caffeinated beverage and a data feed from a litany of web and blog sites. Over the last few days, as asset prices have set new records, there have been numerous articles on whether the market is currently in a bubble. Here are a few I grabbed from a Google search: Where’s The Next Bubble Forming In The Markets? How The ETF Bubble Feeds The Stock Market Bubble Market Entering A Bubble Zone U.S. Stock Market: Is The Bubble About To Burst Well, you get the idea. First, like a “watched pot never boils,” bubbles occur when no one is looking for them. B...