With one after another bank issuing downgrade reports on global stocks, including such stalwarts as JPM and, most recently, Goldman, overnight a far more important market entity - the world's largest asset manager - joined the club when BlackRock downgraded U.S. and European stocks to neutral, citing elevated U.S. valuations and the higher probability of a midyear interest-rate increase by the Federal Reserve.
With the Treasury yield curve collapsing - 2s10s now at 92bps, its lowest since Dec 2007, AcrossTheCurve.com's John Jansen offers Ed Yardeni's insights into the problems the curve is suggesting are here...
Submitted by Mike Krieger via Liberty Blitzkrieg blog,
May was a month of decoupling: oil decoupled from the dollar, and global risk decoupled from the once again sharply devaluing Yuan, but most notably May was a month where Fed rate hike expectations repriced midway through the month.
With the S&P500, seemingly unable to break decisively above 2090, investors are wondering what are the main catalysts that can push the market higher, and are asking questions. To help with the confusion, Deutsche Bank has laid out the top five recurring questions asked by investors who are trying to figure out what will push stocks higher. Among these are whether European (and global) equities will rally as Brexit fears are being priced out; is there scope for earnings upgrades and will value stocks finally start outperforming.