European shares rose as Fiat rebounded on hopes concerns about parallel to Volkswagen are overblown, Asian stocks were little as Chinese shares fell to the lowest level of 2017 after poor export data, and U.S. equity-index futures rose ahead of a deluge of bank earnings. The dollar is headed for a weekly loss and gold trades at the highest price in almost two months.
"After a Jan/Feb wobble, we believe stocks & commodities will have one last 10% meltup in H1," explains BofA's Michael Hartnett in his latest note, but, he adds, by the end of 2017 we will see a "meltdown." BofA awaits the endgame of the so-called "Icarus Trade" amid unambiguous signs of bullish investor Positioning, bullish Profit expectations & hawkish Policy from Fed/ECB, as well as outperformance from laggard risk assets; before calling for the Big Short.
The Icarus Trade
While Rex Tillerson's confirmation hearing as Trump's Secretary of State was for the most part uneventful, several hours into his back and forth with the Senate Foreign Relations Committee, Tillerson compared China’s actions to those of Russia in Crimea, saying a failure to respond had allowed it to “keep pushing the envelope” in the South China Sea.
Risk assets declined across the globe, with European, Asian shares and S&P 500 futures all falling, while the dollar slumped against most currencies after a news conference by President-elect Donald Trump disappointed investors with limited details of his economic-stimulus plans, and the Trumpflation/reflation trade was said to be unwinding.
Good news for globe-trotting Americans: most countries around the world are free or very cheap to get in to. But, as this map from HowMuch.net shows, some countries do charge through the nose for a visa. And it's not the ones you would expect.
Source: HowMuch.net