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Daily Archives: 11th December 2018

11th December 2018

Equities rally, but few convinced

MARKET CLOSE:
iTraxx Main

85.9bp, -2.2bp

iTraxx X-Over

346.5bp, -10.5bp

🇩🇪 10 Yr Bund

0.22%, -2bp

iBoxx Corp IG

B+176.4bp, unch

iBoxx Corp HY

B+529.8bp, +3.4bp

🇺🇸 10 Yr US T-Bond

2.85%, unch

🇬🇧 FTSE 100

6049.62, (-1.73%)
🇩🇪 DAX

12489.46, (-0.04%)
🇺🇸 S&P 500

3152.05, (-0.65%)

Prepare for the worst…

There was an early strong bounce back in Tuesday’s session following the big losses previously, but it’s clear that any real zest emerging from it is looking short-lived. Just too much water has passed under the bridge recently and there still remains a massive amount of uncertainty emanating from several quarters. Furthermore, it’s December, with ‘no’ substantial business likely to get done once we have seen off this week.

Brexit continues to dominate and the odds are that May will come back from Brussels, even at this late desperate hour, with as much as what former PM Cameron did before her: Nothing. We believe that ‘No deal’ odds will have increased dramatically. The current uncertainty, therefore, will dog British and EU politics over the Christmas period and well into 2019. For the market, it should be preparing for the worst.

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