Daily BriefsMacro

Daily Brief Macro: The Second Leg Down In This Bear Market May Be Happening Now? and more

In today’s briefing:

  • The Second Leg Down In This Bear Market May Be Happening Now?
  • A Pending Major Market Bottom? It Sounds Too Easy!
  • A Flock of Hawks Circle Wall Street
  • China A-Share Deep Dive:  Growth Slows, but EM Funds Remain Well Invested
  • The Week that Was in [email protected] – PropertyGuru Lock-Ups, Moya Holdings Delisting, and TISCO.

The Second Leg Down In This Bear Market May Be Happening Now?

By Michael J. Howell

  • S&P500 (SPX) likely to test 3200, may be even 3000, as earnings get crushed. It looks like a classic ‘second leg-down’ in the bear market
  • Tight Central Bank Liquidity has hit sensitive bond markets driving yields higher, but also causing term premia to worryingly collapse to near all-time lows
  • Term premia fall is already set-in-stone and historically has led to much weaker reported corporate earnings some 15 months later. Hence US S&P500 earnings could skid by 20% in 2023

A Pending Major Market Bottom? It Sounds Too Easy!

By Cam Hui

  • Is the universe unfolding as it should? Most technical and sentiment indicators argue for a near-term double bottom in the S&P 500.
  • The new bull narrative sounds far too easy. Macro and fundamental factors argue for further downside potential.
  • Most of the growth concerns and opportunities are outside the U.S., while large-cap U.S. equity valuations are elevated because of their perceived safe-haven status.

A Flock of Hawks Circle Wall Street

By Cam Hui

  • It’s difficult to make definitive calls on market direction ahead of a FOMC meeting.
  • Price momentum is negative in the wake of the hot CPI report and we would expect it to continue into the date of the meeting.
  • Investors need to be prepared for a possible reversal should sentiment and positioning become excessively bearish and hawkish.

China A-Share Deep Dive:  Growth Slows, but EM Funds Remain Well Invested

By Steven Holden

  • The growth in China A-Share exposure has slowed as we approach full ownership across the EM active fund universe.
  • China A-Share allocations have remained solid throughout this year’s volatility and heavy country rotation.
  • Midea Group, Kweichow Moutai and Contemporary Amperex Technology remain the most widely held stocks, but others are starting to make their mark.

The Week that Was in [email protected]tkarma – PropertyGuru Lock-Ups, Moya Holdings Delisting, and TISCO.

By Angus Mackintosh


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