Search Coverage List, Models & Reports
Search Results1-10 out of 269
Central banks are in focus this week, with the FOMC scheduled to release the results of its June meeting this afternoon. The ECB and BOJ are also scheduled to release policy statements on Thursday and Friday, respectively. Inline with consensus, we expect the FOMC to raise the fed funds rate target range by 25bps and signal that another hike is likely in September. Our sense is that the ECB will provide guidance signaling a wind down its QE program later this year, and that the BOJ will reiterate it commitment to targeting the Japanese 10-year yield at 0.10%.
Next Thursday (06/14/18), the European Central Bank meets and is expected to discuss whether to wind down its QE program, which is currently running $30b/month. It’s also possible officials may only hint at ending the program next week, but then formally announce an end to QE at the July 26th meeting.
As our regular readers are well aware, we disagree with many of the items on president’s trade agenda, such as the imposition of broad-based tariffs and targeting trade deficits when the U.S. economy is accelerating. However, we do agree with the president on intellectual property protections and maintaining open access to global markets.
We have found that companies totally eliminating their dividends tend to significantly underperform the broader market both into and out of the dividend cancellation. This shouldn’t be surprising given that such actions usually signal fundamental problems, and result in significant shift in the shareholder base.
Yesterday (05/30/18), the U.S. and German 10-year yields dropped by roughly 15bps and 9bps, respectively, before bouncing back today. Clearly, political uncertainty in Italy was the primary catalyst behind the move. However, based upon CFTC net positions, we also believe that many investors got caught on the wrong side of the trade.
- 1 of 27
- next →