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Emerging markets bonds and equities are deteriorating. Equities are down 8% ytd and bond yields are higher by 200 to 400 btps across the board reacting to US rate hikes and higher bond yields in the US.
US markets are holding up but European equities are mostly lower.
Gold price is off its highs reacting to the same set of inputs while commodities prices are mostly lower reacting to stronger US dollar.
There is a view that deterioration is mostly done and that things will be calmer from here but there is not much supporting evidence to that.
US debt servicing is in focus on most radars and 3 to 4% interest payments on 20$trln US debt cast doubts over stability of US yields in light of economic growth which is far below 4%.
Trade wars which were last fought just before great depression don not help either and bring unpleasant memories or references.
Still it is not clear where the crisis will be coming from. The US debt doesn’t seem too big of an issue especially in light of possible negative effect on the US dollar. Trade wars seem bad but they also create opportunities.
Blockchain and internet money are far too small yet to be a significant risk.
Corporate sector is quite healthy but so it had been in 2008.
There is hope that policy makers in the US, Europe, China and emerging markets are experienced enough to sense the next danger and tackle it. But it is only a hope rooted in the past experiences of waves of QE tranches coming from one source or the other.
Lucky are those how had invested in Tunisia, Saudi Arabia domestic stocks as they are the best markets so far ytd. While less lucky are those who bought Argentina, Turkey, Poland equities as they are the worst so far YTD.
And in general - those who sold in May feel happier now.
Rarely deterioration in emerging market debt has been positive for the markets. The dividend yields which are chunky at times are not looking that attractive vs. bond yields now.
Oil price is holding up – but so it had been in 2008 right until the crash.
WC was a source of optimism and entertainment for a while – and again highlighted the rise of Europe and especially Balkans – with a link to of Austro Hungary. But now that its over the reality will be harsher.
Green shoots of next leg of globalization are seen in China rebalancing, blockchain, new silk roads and more focused of business on social development. But the rise in nationalism and dimming contextualism weigh on the negative side of globalization equation.
The strategy is quite panicky and the advice to share is to RUN but where? - Gold? Exporters? Domestics? Gold?
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Average Sovereign GEM Yields (USD)
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Average Sov. Dev. Markets Yields (blended currency)
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Average UST Yield
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Average Sovereign Local Currency Yields (USD)
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Choose A Country
ARGENTINA: Argentina: A Perfect Storm Creates a Buying Opportunity
| AUSTRALIA: Australia: Shares supported by healthcare, financials; New Zealand ...
| AUSTRIA: European Equity Benchmarks Close Higher; Mining, Auto, Bank ...
| BAHRAIN: GCC Equities Review: Bahrain banks feel the pressure as investors ...
| BELGIUM: Belgium shares higher at close of trade; BEL 20 up 0.33%
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BRAZIL: EMERGING MARKETS-Brazil stocks track US shares, crude prices ...
| BRITAIN: FTSE supported by oil stocks; HSBC eases
| CANADA: BCI returns 9% in fiscal 2018, buoyed by global equities
| CHILE: How To Play A Rebound In EM Stocks
| CHINA: European markets remain firm as China equities suffer
|
COLOMBIA: Colombia shares lower at close of trade; COLCAP down 1.39%
| CZECH: Czech Republic - Factors To Watch on Aug 3
| DENMARK: Denmark shares higher at close of trade; OMX Copenhagen 20 up ...
| EGYPT: Egypt equities review: Early gains evaporate as investors lose ...
| FINLAND: Finland shares higher at close of trade; OMX Helsinki 25 up 0.45%
|
FRANCE: France shares lower at close of trade; CAC 40 down 0.00%
| GERMANY: A Better Way To Profit From Germany ETFs
| GREECE: Greece shares lower at close of trade; Athens General Composite ...
| HONG KONG: Big IPOs can't save Hong Kong from trade war's 'very long shadow'
| HUNGARY: Investments high among venture capitalists, retail investors
|
INDIA: Indian equity on a roll, valuation premium to EMs at multi-year high
| INDONESIA: Indonesia Stocks Are a Must Buy for Analysts as Market Rebounds
| IRELAND: Courts Service of Ireland reduces shares in Big Tobacco, but still ...
| ISRAEL: Israel shares lower at close of trade; TA 35 down 0.57%
| ITALY: Italy shares lower at close of trade; Investing.com Italy 40 down 0.16%
|
JAPAN: China Dethroned by Japan as World's Second-Biggest Stock Market
| KAZAKHSTAN: Uranium Explorer Has Dual Strategy for Making It Big in the Basin
| LEBANON: Arab Stocks Advance as Jitters Over US Strike in Syria Fade
| MALAYSIA: Foreign funds return to Bursa; bought RM348.9mil equities last week
| MEXICO: EMERGING MARKETS-Mexican equities rise amid solid corporate ...
|
NETHERLANDS: Netherlands shares higher at close of trade; AEX up 0.41%
| NEW ZEALAND: Australia: Shares supported by healthcare, financials; New Zealand ...
| NIGERIA: 'Nigerian equities are long-term play'
| NORWAY: Norway shares lower at close of trade; Oslo OBX down 0.01%
| OMAN: Japan's rate decision lifts bonds, shares under tech cloud
|
PAKISTAN: Pakistan's Turmoil
| PERU: Peru shares higher at close of trade; S&P Lima General up 0.55%
| PHILIPPINES: A Mid-Year Look at Philippine Fixed-Income & Equities
| POLAND: Poland shares lower at close of trade; WIG30 down 0.51%
| PORTUGAL: Portugal shares lower at close of trade; PSI 20 down 0.32%
|
QATAR: Embargo Pain Soothed for Qatar as Stock Rout Evaporates
| QATAR: Embargo Pain Soothed for Qatar as Stock Rout Evaporates
| ROMANIA: European Equity Benchmarks Close Higher; Mining, Auto, Bank ...
| RUSSIA: Why Russian Stocks Are Popular Ahead Of Putin-Trump Talks
| SINGAPORE: Singapore shares down by 0.63% on Friday
|
SOUTH AFRICA: Alexander Forbes' outlook for South African equities
| SOUTH KOREA: Asian shares edge higher as China lags after latest tariff threat
| SPAIN: Spain shares higher at close of trade; IBEX 35 up 0.43%
| SWEDEN: Sweden shares higher at close of trade; OMX Stockholm 30 up 0.87%
| SWITZERLAND: Transocean Ltd (Switzerland) (RIG) Dips 3.81% for July 31
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TAIWAN: Yageo sell down breaks lull in Taiwan equities
| THAILAND: July rebound theory for stocks proved right
| TURKEY: How To Play A Rebound In EM Stocks
| UAE: Funds' confidence in UAE equities returning, bullish on Kuwait
| UKRAINE: Manafort trial delayed; he wants Ukraine work kept from jury
|
UNITED STATES: Trade war weighs on gains in equities, earnings
| VIETNAM: Angst Rises in Vietnam as Stock Turmoil Hits Eight-Year High
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Comment
Monthly performance is between 2018-08-01 and 2018-07-02
Best global markets YTD USA +5.38%, EUROPE-2.83%, EM LATIN AMERICA-4.32%,
While worst global markets YTD FM (FRONTIER MARKETS) -10.40%, EM (EMERGING MARKETS) -6.18%, EFM ASIA -5.85%,
Best global markets last month EM LATIN AMERICA +11.76%, EUROPE +3.99%, FM (FRONTIER MARKETS) +3.94%,
While worst global markets last month EFM ASIA 0.84%, EM (EMERGING MARKETS) 2.60%, USA 3.06%,
US Stocks Fall on Trump Plan for China Tariffs: Markets WrapUS Stocks Are Outperforming Everything - By A Wide MarginTurkey to Set Tone Again for Emerging Markets This WeekMARCUS ASHWORTH: Why this emerging market selloff looks ...China stocks fall on gloomy private survey, little boost from MSCI ...China Stocks Likely to Fall Further, Citigroup's Apabhai SaysWhy the outlook for European equities is brighter than everEuropean Equities Not Very Interesting, Says Saxo Bank's GarnryCan We Expect An Oil Price Spike In November?The Biggest Threat To The Oil And Gas IndustryIron ore markets finish mixed as steel prices stabiliseRaw Steels MMI: Steel Price Momentum SlowsGold Price Analysis: $1200 is a magnetGold price opens lower in Hong Kong
Best last month among various countries' equity markets were ZIMBABWE +16.47%, ARGENTINA +15.35%, BRAZIL +14.14%, MEXICO +13.34%, POLAND +13.27%, QATAR +13.04%, BAHRAIN +11.49%, PHILIPPINES +9.72%, THAILAND +9.15%, KUWAIT +7.52%,
While worst last month among various countries' equity markets were TURKEY -6.46%, JORDAN -5.00%, OMAN -4.12%, CHINA -4.00%, SRI LANKA -3.55%, NIGERIA -3.28%, EGYPT -3.19%, KAZAKHSTAN -3.08%, BANGLADESH -2.40%, BULGARIA -1.54%,
Best YTD among various country equities were TUNISIA +40.78%, ZIMBABWE +34.67%, SAUDI ARABIA DOMESTIC +21.30%, QATAR +15.72%, TRINIDAD AND TOBAGO +12.45%, KUWAIT +11.58%, KENYA +9.63%, COLOMBIA +9.17%, FINLAND +8.45%, ISRAEL +8.35%,
While worst YTD among various country equities were ARGENTINA -38.99%, TURKEY -36.76%, MAURITIUS -26.52%, OMAN -17.13%, INDONESIA -16.17%, ESTONIA -15.42%, BOTSWANA -14.68%, BANGLADESH -14.32%, PHILIPPINES -14.29%, HUNGARY -14.19%,
