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Daily Archives: 14th November 2019

14th November 2019

Macro skating on thin ice

iTraxx Main

49.8bp, +0.2bp

iTraxx X-Over

238.7bp, +2.9bp

🇩🇪 10 Yr Bund

-0.35%, -5bp

iBoxx Corp IG

B+112.5bp, +1.25bp

iBoxx Corp HY

B+397.5bp, +5bp

🇺🇸 10 Yr US T-Bond

1.81%, -6bp

🇬🇧 FTSE 100

6095.41, (+0.76%)
🇩🇪 DAX

12633.71, (+1.15%)
🇺🇸 S&P 500

3185.04, (+1.05%)

China’s triple whammy warning…

Giveth with one hand and whippeth away with the other. Germany defied expectations with a surprising albeit preliminary positive print (+0.1%) for Q3 GDP growth, thereby managing to dodge a technical recession. Few will have rejoiced given that they’re stagnating and the outlook doesn’t look great.

Before that, China reported that her industrial production rose just 4.7% year-on-year in October against expectations pitched at 5.4%, while fixed asset investment rose by 5.2% – the lowest level since records started. A thoroughly miserable set of data was rounded off as Chinese retail sales growth for October also missed.

Perhaps more important for near term market performance is a trade deal announcement and, if it ever comes, it will only serve to stem the rate of decline in the macroeconomic outlook. The rest is all noise. Equities are gyrating to the news flow, which is usually enmeshed in a Trump tweet or some other official either from the US or China suggesting a phase one deal is imminent.

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