Authored by Peter Tchir via Academy Securities,
When Reality and Sentiment Diverge
The Hopium versus Doomium Model
We are initiating the Hopium vs. Doomium model today. I first came across the word Hopium in the aftermath of the financial crisis. It was typically used by ‘doomers’ who believed markets were far ahead of themselves and were betting on hope rather than reality.
European shares are modestly lower as investors monitor tense events in Spain and as focus turns to Thursday’s ECB meeting; US equity futures have rebounded from yesterday's sharp but shallow selloff and are in the green amid rising odds of U.S. tax reform and the imminent unveiling of the next Fed chair while Asian shares rise and Japan extends its winning streak to a record 16 days. The euro edged higher after data showed Europe’s economy is maintaining momentum, while the USDJPY managed to recover all of yesterday's sharp losses.
Authored by Christopher Cole via Artemis Capital Management,
A full version of the article is available on the Artemis website.
Volatility and the Alchemy of Risk
World stocks stayed near peaks and currencies moved in tight ranges on Wednesday as China’s 19th Communist Party Congress opened while focus in Europe turned to speeches from top euro zone central bankers before next week’s key policy meeting, as well as Catalonia's ultimatum due on Thursday. S&P futures are solidly in the green as usual, with Dow futures jumping above 23,000, driven higher by IBM as investors looked for new reasons to extend gains after hitting new all-time highs Tuesday.
Global markets traded near all-time highs on Tuesday, with S&P futures, Asian shares and European stocks all flat this morning, while oil continued to gain on Kurdish geopolitical concerns while most industrial metals fell. The euro extended its recent slide and stocks drifted as Spain’s escalating hard-line response to the Catalonian secession threat fueled concern the crisis may intensify.