In today’s briefing:
- Overview #27 – The Big Beautiful Tragi-Comedy Continues
- Bond Vigilantes and Trade Tensions Derail the Momentum Bull
- Sell America = Buy Gold
- Copper Tracker 26th May 2025: TSF Momentum Dampened on Trump Tariffs in April
Overview #27 – The Big Beautiful Tragi-Comedy Continues
- A review of recent events/data impacting our investment themes and outlook
- What are major global bond markets telling us about the world?
- We look at potential beneficiaries of the next wave of inflation
Bond Vigilantes and Trade Tensions Derail the Momentum Bull
- The stock market advance is due for a pause and faces numerous headwinds.
- The rise of the bond vigilantes, elevated valuation and heightened earnings risk, and narrow leadership combined to increase risk.
- Tactically, the S&P 500 is breaking down technically a pullback wouldn’t be out of line under the circumstances.
Sell America = Buy Gold
- The Sell America investment theme is becoming as a dominant market narrative, and it’s bullish for gold.
- It is driven by the combination of rising deficits, shaky bond markets, an increasingly hawkish Fed and policy uncertainty.
- For a long-term perspective of the upside potential in gold, a point-and-figure chart of monthly gold prices shows a measured objective of almost $7,000.
Copper Tracker 26th May 2025: TSF Momentum Dampened on Trump Tariffs in April
- The narrative surrounding China’s front-loaded stimulus faced some headwinds as April’s total social financing (TSF) figures undershot expectations, registering 1.16 trillion yuan compared to expected 1.3-1.4 trillion yuan.
- Nonetheless, TSF remains up 28% ytd, reaching 15.2 trillion yuan, indicating a robust overall increase relative to the prior year. We expect it to pick up steam in future months.
- We believe this will be bullish for copper pricing, coupled with the supply side sluggishness. (Read: Post Results FY24: Mine-By-Mine Plan Production + Commentary on Copper From Global Listed Companies ).
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