Tuesday 26 March 2019

Rate outlook shifting

US equity indexes closed broadly higher, sp +20pts (0.7%) at 2818. Nasdaq comp' +0.7%. The two leaders - Trans/R2K, settled +1.1% and +1.0% respectively. Near term outlook offers moderate upside, before another swing lower, probably on BREXIT 'hard-exit' concerns.

sp'daily5



VIX'daily3



Summary

US equities opened moderately higher, and quickly built significant gains to 2829. There was a distinct cooling wave in late morning to 2803, with the afternoon seeing renewed upside. Volatility was in cooling mode, with the VIX settling -10.1% at 14.68.


Rate outlook shifting

Today saw the cheerleaders on the lunchtime show, argue over the next move in interest rates. It is increasingly the case that many now expect a rate cut as early as September.


For the record, I don't expect a rate cut until at least the FOMC of Oct'30th or Dec'11th. In any case, a rate cut will be the ultimate sell signal.

Ohh, and BREXIT is now just 3 days away. Whilst there will be a truck load of 'indicative' votes in the UK Parliament on Wednesday, it makes zero difference, as UK law has NOT yet been changed.
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More making an escape from BREXIT land

Long evenings begin this Sunday, with the UK/EU clocks changing.
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Goodnight from London
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