As the Fed begins its two-day meeting, global stocks have recovered their footing and European shares rise, led by a bounce in tech stocks as last Friday's global selloff that started in the sector shows signs of abating. Asian stocks and U.S. futures gain as investors turn their attention to today's Jeff Sessions testimony as well as tomorrow's barrage of macro data including Yellen, CPI and retail sales.
Since The Fed began its 'tightening cycle' in December 2015, the Treasury yield curve (2s10s) has flattened dramatically, tumbling back today towards cycle lows (and well below Trump-election-hope lows). What is perhaps more worrisome is the historical trend strongly suggests this trend is far from over and an inverted yield curve looms.
The trend is clear that Fed policy is running counter to growth expectations and all the hope that Trump offered has been erased completely.
Along with Eric Mindich's Eton Park Capital Management, Viking Global Advisors was once a stalwart name in the hedge fund industry, consistently generating double digit returns no matter the economy or macro climate.
After a tumultous week in the world of politics, with non-stop Trump drama in the US, a disastrous for Theresa May general election in the UK, and pro-establishment results in France and Italy, this is shaping up as another busy week ahead with multiple CB meetings, a full data calendar and even another important Eurogroup meeting for Greece. Wednesday's FOMC will be the main event, with the Fed expected to hike 25bp (see full Goldman preview here), while the BOJ, BOE and SNB all remain on hold.
Courtesy of BofA, here is the breakdown of key events:
In a major shakeup at one of the largest US industrial conglomerates, General Electric said Monday Jeff Immelt, 61, would step down as CEO and Chairman, a move that had been expected by many. Immelt will remain Chairman of the Board through his retirement from the company on December 31, 2017.
John Flannery, 55, the company’s current president and CEO of GE Healthcare, will take over as companywide CEO effective August 1, concluding a 16 years period during which the stock price of GE has barely budged.