Sunday , September 15 2019
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The author Marc Chandler
Marc Chandler
He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.

Marc Chandler

Six Things to Watch in the Week Ahead

The prospect of a third trade truce between the US and China helped underpin the optimism that extended the rally in equities.  Bond yields continued to back-up after dropping precipitously in August, led by a more than 30 bp increase in the US yield benchmark.  The Dollar Index fell for the second consecutive week, something it had not done this quarter.   The Federal Reserve's meeting on September 18 is the most important calendar event in the week ahead. There is no doubt in the...

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Jump in Yields Didn’t Derail Equity Rally While Sterling Rallies Ahead of the Weekend on (misplaced) Brexit Optimism

The most striking thing about last week's price action was the surge in US yields.  The 10-year yield jumped about 34 basis points, the most in three years and returned to levels not seen since August 2 (1.90%).  A deluge of investment-grade corporate bonds and US Treasuries ($78 bln auctioned to lukewarm reception), coupled with an acceleration of core CPI (highest in 11 years), optimism on the trade front, and Mnuchin's insistence on pushing forward with an extra-long bond, (50, and...

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Cool Video: Thoughts on ECB

A few hours after the ECB announced a new package of monetary accommodation, I joined a discussion on CNBC Asia with Nancy Hungerford and Sir Jegarajah.  Here is a clip of part of our discussion.   I make two points.  The first is about the euro's price action.  What impressed me about it was that the euro posted an outside up day, trading on both sides of the previous day's range and closing above its high.  When Sri and I were talking early in the Asian morning, there still had not...

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Bonds and the Dollar Remain Heavy Ahead of the Weekend

Overview:  The markets are digesting ECB's actions and an easing in US-Chinese rhetoric.  Next week features the FOMC meeting and three other major central banks (Japan, Switzerland, and Norway).  The US equity rally that saw the S&P 500 edge closer to the record high set in late July spilled over to lift Asian markets.  Chinese and Korean markets were closed for a mid-autumn holiday.  The Nikkei rose 1% to bring the week's gain to 3.7% on top of last week's 2.4% rally.  It is at...

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Focus on the ECB, while the Dollar Slips below CNY7.09

Overview: Some gestures in the US-China trade spat have given the market the reason to do what it had been doing, and that is taking on more risk. Equities are higher in Asia Pacific and opened in Europe higher before slipping. The MSCI Asia Pacific and the Dow Jones Stoxx 600 are advancing for the fourth consecutive week.  US shares are firmer in European trade, and the S&P 500 will test the air above 3000 today. Its rally is lifting the benchmark for the third consecutive week. ...

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Dollar is Firm as ECB is Awaited

Overview: Global equities are extending their recent gains while bonds remain on the defensive.  The dollar is firm.  There is a degree of optimism that is prevailing. There are some more overtures in terms of US-Chinese trade. In Hong Kong, developers and banks led an equity rally on ideas that the political tensions may ease. South Korea reported better trade data for the first ten days of September. Italy's Conte survived a second vote of confidence yesterday, putting a new...

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Turn Around Tuesday

Overview: The momentum from the end of last week carried into yesterday's activity, but the momentum began fading.  Today, equities were mixed in Asia Pacific and weaker in Europe. The Dow Jones Stoxx 600 reversed lower yesterday and is slipped further today.  The S&P 500 may gap lower at the open.  US 10-year yields are a little softer after reaching one-month highs near 1.65%, but most European benchmark yields are one-two basis points higher.  The dollar is also finding new bids...

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Market Sentiment Still Constructive

Overview: The improvement of investor sentiment seen last week is carrying over into the start of the new weeks.  Global equities are firm as are benchmark yields. Asia Pacific equities advanced, except in Hong Kong, where Chief Executive Lam's promise to formally withdraw the controversial extradition bill failed to deter protests.  European markets extended their three-week advance at the open, but are struggling to sustain the upside momentum.  US shares are trading with a firmer...

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Correction or Trend Change?

The US dollar closed lower against all the major currencies last week but the Japanese yen.  The Swiss franc's 0.25% gain was the smallest of the majors.  The move against the dollar was led by the Swedish krona, whose 2% gain was aided by a less dovish than expected central bank.  Other currencies, like the dollar bloc, which often trades better as risk appetites improve, also did well.  Sterling was lifted by the perceived likelihood that a no-deal Brexit had been averted. The...

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Gaming the ECB and Putting the Cart Before Horse in the Brexit Drama

The step away from the edge of the abyss may have stirred the animal spirits, but it remains precarious at best.    The formal withdrawal of the extradition bill in Hong Kong is too late and too little at this juncture.  The ambitions of the protests have evolved well beyond that.  Italy has a new government, but a prolonged honeymoon is unlikely for this unlikely union.  Face-to-face talks between the US and China are better than no talks but hardly indicates an end to the tariff war. ...

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