Monthly Reports

Insight and Analysis on the latest global trends by Hassium’s team of financial investment experts

Every month Hassium independently produces a detailed global investment market summary with the aim of providing an expert insight into the macroeconomic environment as well as taking an in-depth look at individual asset classes. We discuss our product recommendations, considering; government and corporate bonds, global equities, foreign exchange and commodities.  We also highlight our current allocations and outlook with regards to each sector with a clear rationale behind how we feel current market events have and will influence how we at Hassium manage our client portfolios.

To access these reports you can subscribe by emailing info@hassium.co.uk providing us with your name, email address and company details. Upon successful subscription you will have access to; Monthly Reports and Research Articles. You will also receive an emailed copy of the reports on issuance every month. 

Hassium Market Summary - 7th June 2019 - US China Trade Tension, UK Elections and a 'No Deal Brexit'

Global equity markets are still +13.8 % YTD and concerns about growth have moderated. We believe a trade agreement between the US and China will be reached - eventually. We also expect equity markets to take a short-term breather. Bond yields have reduced meaningfully and we remain underweight duration and credit. We see US interest rates on hold rather than falling. European equities had a testing time recently but we remain neutral. We do recognise that positive catalysts like falling oil prices, a weaker trade-weighted EUR and the potential for fiscal stimulus are favourable factors to keep a watchful eye on. In the UK, we anticipate a 'No Deal' BREXIT on the 31st October and that Boris Johnson will be the next UK Prime Minister.

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Hassium Market Summary - March 2019 - Sell Off Ahead ?

Markets continue to trade higher with the MSCI world index +14.4% YTD but is a sell off ahead ? We see an improving global growth outlook which have also boosted global commodities with WTI oil +39.8% YTD and the S&P GSCI Index up 19.5% YTD. Brexit continues to deliver uncertainty to the European markets and a second referendum is not out of the question, followed by a general election in the UK. According to Goldman Sachs, Brexit is costing the UK economy £600 million/week. We remain cautious of global growth but see the talk of recession as overstated. We expect equity markets to take a breather during Q1 earnings season as investors react to negative earnings growth for the first time since 2016. We expect interest rates to remain at current levels and the overvalued USD to weaken

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Hassium Market Summary - February 2019 - Uncertainty still high despite stronger markets

Spring has arrived and equity markets continue to trade higher on the back of Powell’s dovish comments and strong Q4 earnings numbers. Sentiment around the US-China trade dispute seems to be improving, though still uncertain. In European and UK markets feel strained around geopolitics and BREXIT, though a no deal outcome now seems unlikely. Despite this recent global growth concerns and talk of recession seem to have abated. With markets now +11.5% YTD we see equities as overbought and we have slowly trimmed back our exposure short term. Longer term we still see US and Chinese equities trading modestly higher and the USD weakening.

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Hassium Market Summary - January 2019 - Bulls Put the Bears on Hold

Happy Valentines day! We hope this is the message Donald Trump gives to Xi Jinging. The sentiment also applies to Teresa May and Michel Barnier. Geopolitics seems to be dominating financial markets but the bulls seem to have the bears on hold at least for now. The real focus continues to be corporate earnings and recent global growth concerns and talk of recession seem to have abated. We do expect markets to take a breather in February following the January rebound. Longer term we see US equities trading modestly higher.

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Hassium 2019 Market Outlook

Markets were very volatile in December 2018 trading -7.9% on the back of global growth concerns. News focused on ongoing US-China trade tension and uncertainty in Europe over Brexit and Italy. Whilst growth is slowing markets seemed to have rushed to price in a recession. We see the sell off as over-done and an opportunity to slowly build on risk and exposure. Over the last two weeks Powell’s dovish comments coupled with positive US-China trade talks have provided some support with markets currently +3.2% YTD. We expect markets to trade higher in 2019 with investors focused more on fundamentals and earnings rather than noise associated with geopolitical events. We do see global growth slowing but we do not predict a recession.

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Hassium Market Summary - November 2018 - The Bearish Narrative Continues

Both financial markets along with the weather and temperature here in the UK have fallen. Whilst we were expecting markets to take a short term breather the magnitude and speed of decline has caught many investors by surprise. Fundamentally though nothing seems to have changed apart from Trump going quiet. US Midterms are on the horizon. Q3 earnings have been broadly better than expected. However, stretched equity valuations along with geopolitical events seem to be driving market sentiment and global GDP growth concerns. My family are more interested in fireworks and upcoming Diwali celebrations.

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Hassium Market Summary - October 2018 - Improving Trade Sentiment

Q3 comes to an end with my oldest starting at Sussex University and US equities having their best quarter in five years. Both amazing achievements! US equities are now +10.4% YTD with the US ten year firmly above 3.0%. This is despite a flattening yield curve, US China trade tension, rising rates, scandal in Washington, and a significantly over valued dollar. In Europe markets look strained +0.9% YTD with Brexit uncertainty and now struggling Italian banks. Closer to home UK politics look like a bigger car crash than an Elon Musk Tweet. Equity markets, along with my oldest post freshers week, now need to take a short-term breather.

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Hassium Market Summary - September 2018 - Flattening Yield Curve

Summer holidays come to an end thought the current bull market run continues. In the US Q2 earnings comfortably exceed expectations and the S&P500 and NASDAQ hit new record highs despite ongoing trade war rhetoric, political scandal and Brexit uncertainty. In contrast, European markets continue to lag the US and we note their diverging fortunes in terms of growth. August also saw Apple become the first $1 trillion company in history, closely followed by Amazon yesterday. Interestingly Switzerland’s GDP is only $700 billion. In contrast, Tesla’s market cap declined -20% on the back of CEO Elon Musk wanting to take the firm private and then not. I asked my kids, new to driving, if they would prefer a Tesla or an iPad. Thankfully the millennial mind set opted for the latter. Many private investor are now cautious equity markets with a flattening yield curve, which usually indicates the start of a market downturn or recession. We however remain more constructive!

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Hassium Market Summary - August 2018 - Tariffs, Tensions, Tech and Trump (obviously...)

Summer holidays begin and the hot weather here in London has been unbearable. The arrival of rain was more welcomed than Donald Trump and the EU agreeing to work towards ‘zero’ tariffs, barriers and subsidies. Facebook and Twitter both sell off 20% following disappointing Q2 numbers though we seem to have forgotten Amazon and Alphabet releases two weeks back and Apple last week which broke the $1 trillion market capitalisation level. I checked with my teenage kids to see if they still use Facebook. It was a firm ‘no’ and they seemed astonished I had even asked.

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Hassium Market Summary - July 2018 - World Cup Shocks; Trade War Worries

Due to holidays I am doing the market update this month. I have missed writing to you all and many of you have made reference to not knowing how the kids are doing, my broader views on financial markets, Trump trade wars, and of course ongoing Brexit concerns. Markets aside, it has been a very happy weekend here in London with the ongoing heatwave, the England Sweden world cup football result, coupled with the colour and energy of London Pride. That all said my focus has been on upcoming Q2 earnings and the fact that my kids are already getting bored in the run-up to the start of the summer holidays.

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Hassium Market Summary - May 2018 - US versus the World

2018 was not the year to ‘sell in May and go away’ given the rally that we have seen in recent weeks. Maybe a more accurate description would be ‘profit take in May and slightly de-risk the portfolio’. Markets resumed their upward move despite an increasing number of obstacles - at Hassium we spend a lot of time looking at risks that are facing the market. • Macro risks - when will the current economic cycle peak and how many interest rate hikes will there be in the next 12 months? • Political risks - how far is Trump prepared to go in his trade wars and Brexit? • Demographic and structural shifts - retirement baby boomers, emergence of Asian consumers and what is the consequence of the shift to online expenditure? • Market impact - what is the impact on EM of higher US interest rates? We are currently focused on the impact of rising US interest rates on USD denominated debt issued by countries in Latin America, the impact of Italian politics on the Euro currency, the impact of Amazon on the US and EU retail sectors along with looking at the growing differences in technology companies between subscription-based models and personal data/advertising-based models. Our current market view is that we are now approaching a second half of 2018 with higher political and macro uncertainty than we saw at any point in 2017. Consequently, we have been paring down risk in client portfolios and will look to do so further over the summer.

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Hassium Thoughts: The Current Climate of Cyber-Security and Data Protection

We live in a world where your personal data might be the most valuable thing you possess. Consequently, who we choose to share our data with, or more importantly who we choose to not share it with, is increasingly becoming a more conscious consumer decision. As increasing amounts of data about us are stored, the number of attempts to access the data correspondingly increase. This has led to the creation of the cybersecurity industry with a market value of over $135bn. We all leave our footprint on the web, and knowing our browsing habits, areas of interest and online habits is of high value to companies. Some companies, Alphabet for example, (depending on your individual set up) know where you live, where you work, what time you commute, whether you prefer Tesco or Sainsburys for groceries, what you browse online, what you watch on YouTube along with every single google and YouTube search you have done. (https://maps.google.com/locationhistory - if you have a gmail account want to see where you have been).

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Hassium Market Summary - March 2018 - Investors Suffering from Whiplash

Here in the UK we are patiently waiting for Spring to arrive and the rain to disappear. As a new father I am quickly becoming familiar not just with the share prices of Apple, Amazon and Mastercard, but also the prices of nappies, wet wipes and baby-grows! Financial markets this last month have been volatile after months of unstoppable positive returns. Chinese trade wars, the threat of NAFTA withdrawal and US tax cuts have dominated the headlines, with rising inflationary concerns and FOMC rate hike discussions not too far behind. The MSCI World Index fell -2.1%, showing that market isn’t taking these revelations lightly. In the US we have had another political game of musical chairs in the White House – National Security Advisor is the newest senior post to be reshuffled.

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Hassium Thoughts - The Rise of the Asian Consumer

We are a global fundamental top-down investment boutique which gives us the ability to look at the whole world for investment opportunities– this can be both exciting and daunting. We express a number of investment themes in our portfolios and over the coming months, in between our usual month end newsletter, we are going to talk you through these themes and investment opportunities. The first of these themes is the Emerging Market Middle Class and the follow-on impact for ecommerce and mobile gaming. I used to purchase books on Amazon when that was all they sold and my first experience of gaming was Pong on the Atari. Now I watch in amazement as my two year old niece confidently operates an iPad to play all sorts of games (other touchscreen tablet devices are of course available). We are witnessing the most rapid expansion of the middle class that the world has ever seen and believe this presents a significant opportunity for investment. Almost all of the next billion entrants into the global middle class will come from Asia; 380 million Indians, 350 million Chinese, and 210 million other Asians.

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Hassium Market Summary - February 2018 - Markets Plummet with Temperatures

What a difference a month makes. Having spent most of January being lulled into a false sense of security, investors were quickly woken with a nasty bump. For me personally, February was a bit of a whirlwind with a lot of uncertainty and movement. The beginning of February saw the collapse of the XIV inverse volatility ETF and pullback of the equity markets as volatility once again returned. The end of February saw just as much uncertainty for me personally with the imminent arrival of my daughter. She finally emerged very early on Friday 2nd March after 30 sleepless hours and very little idea of what day it was!

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Hassium Market Summary - January 2018 - Hassium 2018 Market Outlook

Happy New Year. After a year in which we have seen the commencement of Brexit negotiations, ongoing investigations into Trump and his ties with Russia, European general elections, and growing friction between the US and North Korea, we wanted to share with you our 2018 Global Market Outlook. We are positioned for equity markets to outperform bond markets throughout 2018 on the back of rate hike expectations, coupled with earnings revisions and robust economic data. We see the USD as range bound. We are constructive Emerging Markets. However, the biggest market event for me will be the arrival of a baby girl expected in 8 weeks!

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Hassium Market Summary - December 2017 - Trump’s Stock Market Christmas Present: Tax Reform

There are only 10 working days to Christmas and I have yet to start shopping for presents. Despite stretched equity valuations and a tech sector sell off markets are slowly trading higher into year-end on anticipation that Trump will deliver the best Christmas present ever. That said the global risk backdrop is clearly worsening. In geopolitics May faces a Brexit revolt, Washington turns to avoiding a shutdown, Trump’s tax reforms have yet to materialise, and in cricket England seems to have already lost the Ashes. This is great news for bond markets but not good news for global equity markets or the UK economy. The other big piece of news this month is the promotion of Simon Black here at Hassium to Chief Investment Officer. Future monthly summaries will now come from Simon and you will no longer hear about me and the kids unless you specifically ask.

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Hassium Market Summary - November 2017 - Equity Markets Running on Empty?

Last week was the first Bank of England rate hike in a decade. My kids tell me ten years back that the iPhone had just been launched and in the office I’ve been reminded that London house prices were almost half the price they are today. Gordon Brown was PM and looks like a safer pair of hands than the current Theresa May (aka Boris) and Jeremy Corbyn. Despite the UK rate hike global equity markets are trading higher with investors focused on Trump announcements, earnings season and stretched equity valuations. My 13 year old daughter did a Bloomberg work experience morning and now thinks markets will trade higher into year end. Note she voted Brexit at school last year and we cannot help but think she might be right again.

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Hassium Market Summary - October 2017 - Waiting for the President to Play His Trump Card?

I learnt a new card game with my kids this weekend. The game is called ‘Cheat’. Ironically we had been playing a version of ‘Trumps’ but the name became synonymous with the US president and all he has been doing. We needed a change. Markets in contrast have traded higher so probably don’t agree with the need for change. Neither card game sounds good and perhaps ‘Cheat’ seems more appropriate for where markets are – ignoring uncertainty around North Korea, Brexit negotiations, US tax reforms and the appointment of a new Fed chair.

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Hassium Market Summary - September 2017 - 78 Trading Days to Christmas

Kids go back to school and the rainy summer months turn into rainy Autumn months. Markets continue to hit fresh highs though trading volumes over the holiday period have been light. We note there are now 78 trading day until Christmas. President Trump has managed to remain in the spotlight with his war of words with Kim Jong Un causing a flight to safe haven assets. Hurricane Harvey in Texas has also impacted on oil prices and likely US GDP growth longer term. Despite this, global equity markets are +11.1% YTD though markets are tired with stretched PE valuations, uncertainty over the outcome of Brexit negotiations which seem to be going nowhere, and a question mark over the likelihood of President Trump’s proposed tax cuts. We remain constructive the US but see European markets outperforming. We see the probability of one more rate hike this year in the US diminishing. We see the USD weakening further but remaining overvalued on a PPP basis. In our view, equity markets are likely to consolidate around these levels and many investors still remain reluctantly overweight cash.

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Hassium Market Summary - August 2017 - Markets grind higher but for how long?

Whilst the rain pours, US equity markets repeatedly hit fresh new highs with the Dow breaking 22,000 and broader US equity markets now +11.6% YTD. Q2 earnings have been positive and guidance better than expected. More hawkish Central Banks have led to bond yields climbing higher. Oil market seems to have stabilised despite inventory concerns and expectations of production cuts. Markets do however feel tired with stretched PE valuations, uncertainty over the outcome of Brexit negotiations, and a question mark over the likelihood of President Trump’s proposed tax cuts. We remain constructive the US but see European markets out performing. We see the probability of one more rate hike this year in the US diminishing. We see the USD weakening further but remaining overvalued on a PPP basis. In our view, equity markets are likely to consolidate around these levels and many investors remain reluctantly overweight cash.

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Hassium Market Summary - July 2017 - Stuck between central bank commentary, earnings season and stretched valuations

The hot weather returns to London and GCSE exams are now finished. Global equity markets grind higher despite hawkish central bank comments. Oil trades lower and Trump faces further political scandal surrounding ties with Russia. At home the very sad recent Grenfell tower fire event was not a market event but will likely impact on policy and austerity in the UK longer term. Maybe something positive will come from such a tragic event.

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Hassium Market Summary - June 2017 - Do equity markets need to take a breather?

Global equity markets are now +9.6% YTD as equity indices marched on despite geopolitical headlines and a widening disparity in economic data. Markets remain uncertain over the outcome of the upcoming UK general election, Brexit negotiations and the likelihood of President Trump’s proposed tax cuts.

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Hassium Market Summary - May 2017 - Markets Grind Higher

Markets have been quiet these last few weeks with the VIX falling below 10, a level not seen since 1993. In April we did see a relief rally following the first round of the French Elections and a muted response following the second round which confirmed the widely-anticipated Macron victory. Global equity markets are +8.7% YTD, with the US +8.0%, Europe +11.8%, Japan +5.2% and Emerging Markets +16%. Investors remain overweight cash waiting for markets to sell off, wondering if and when this will ever happen.

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Hassium Market Summary - February 2017 - ‘La La Land’ and US Rate Hikes

Global equity markets are +4.7% YTD, with the US +6.1%, Europe +4.3%, Japan +2.6% and Emerging Markets +7.2%. Further upside remains dependent on policy change in the US and political uncertainty becoming clearer around Brexit negotiations and the French elections. In the US GDP growth, employment and fiscal spending remain robust. Equity valuations look stretched with forward PE’s now at 18.3. Further upside is dependent on Donald Trump following through with more detail around his fiscal spending, corporate tax cuts and deregulation promises. Inflation remains a risk. We now expect 3 interest rate hikes in the US and see an overvalued USD strengthening further short term, but then slowly weakening. The US will likely increase interest rates on the 15th March despite considerable easing still prevalent throughout the rest of the world.

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Hassium Market Summary - January 2017 - US Trumps French Election Risk?

Global equity markets are +2.9% YTD, with the US +3.7%, Europe +0.2%, Japan +1.8% and Emerging Markets +7.9%. Further upside is dependent on policy change in the US and political uncertainty around the elections in France. In the US equity valuations look stretched with forward PE’s at 17.8. Further upside is now dependent on Donald Trump following through with his fiscal spending, corporate tax cuts and deregulation promises. We now expect two interest rate hikes in the US and see an overvalued USD slowly weakening but remaining strong. The US will not be able to raise interest rates as quickly as they would like due to considerable easing still prevalent throughout the rest of the world.

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Hassium Market Outlook - 2017

Markets ended the year +6.8%. Geopolitical events in the second half of the year dominated in 2016 with the UK vote to leave the EU in June and Donald Trump winning the US presidential election in November. Looking ahead global growth and inflation seem to be heading higher with loose fiscal policy and easy monetary policy. We are neutral equities and underweight bonds. We see a market driven by interest sentiment and currency volatility. Longer term the glass remains half-full though we expect equity markets to now take a breather.

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Hassium Market Summary - November 2016 - Time to take a Breather?

Global equity markets rallied in November on the back of a surprise Trump election victory. Investors very quickly rotated out of government bonds into global equities and the USD rallied. Global equities are now +7.0% YTD, with the US +12.9%, Japan +2.4%, and Europe +1.8%. In the UK Sterling has declined -14.5% YTD offset by UK equities +16% YTD. Emerging markets are up +13.2% YTD, though China is down -9.1%. We now expect equity markets to take a breather into year end and Q1 2017.

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Hassium Market Summary - October 2016 - Poor America?

In the US, election results look too close to call. We still expect no interest rate hike this year, though the Fed remains hawkish with markets now pricing in a 71.4% chance of a rate hike by December 2016. Third quarter earnings season has started well as earnings growth so far has surprised on the upside +5%, though the impact of the stronger USD is yet to be seen.

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Hassium Market Summary - September 2016 - Central Bank Inaction and 'Hard' Brexit

Global equity markets are little changed at +2.3% YTD, with US equities +7.8%, Japanese equities down -12.1%, European equities down -4.8% and the UK equity market +14.2%. Equity markets remain expensive with forward PEs at 17.5. Trading volumes and volatility have picked up. Third quarter earnings seasons kicks off with Alcoa reporting on 11th October. We have become constructive bonds, at least for now, on the back of central bank inaction.

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Hassium Market Summary - August 2016 - Tired Markets

Global equity markets are +2.3% YTD, with US equities +7.8%, Japanese equities -10.3%, European equities -4.2% and the UK equity market +12.2%. Trading volumes have been well below average and volatility subdued. Equity markets are now looking expensive with forward PE’s at 17.5 and it is difficult to see huge upside short term.

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Hassium Market Summary June 2016 - Global Stocks Rise on Stimulus Bets and Positive Economic Data

Global equity markets are now +0.6% YTD, with US equities +6.6%, European equities -7.1% and the UK equity market +10.6% YTD. Trading volumes have been below average particularly in Europe. The UK referendum result surprised markets but we see Brexit as a tail risk event, similar to the way oil prices, the strong dollar and concerns about China created volatility back in January and February. Since Brexit, the UK has rallied +5.5%, US +1.9% and Europe declined -3.3%. Much of this move has been about the impact of USD strength on earnings rather than Brexit sentiment or media coverage.

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Hassium Market Summary May 2016 - Time to Take a Breather

Global equity markets are essentially flat YTD having recovered from the -12.6% low point reached on 11th February 2016. Trading volumes remain muted. Investors should stay focused on global growth, a weaker USD and upcoming Q2 earnings season. Noise and market volatility surrounding Brexit and the US presidential elections will provide a good entry point for slowly allocating to risk.

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Hassium Market Summary March 2016 - The USD and Earnings

Global equity markets are now down -1.0% YTD having recovered somewhat from the -12.6% low point reached on 11th February 2016, though trading volumes and market volatility are below respective 50 and 200 day moving averages. Sentiment has improved on the back of increasing oil prices, better than expected growth data from China, further QE from the ECB and BOJ, and an FOMC indicating a delay to further interest rate hikes. Noise surrounding US presidential elections and the Brexit referendum in the UK will add to volatility but the focal point for investors remains the outlook for global growth, a weaker USD and a challenging Q1 earnings season.

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Hassium Market Summary February 2016 - The Nonsense of Brexit

Global equity markets are down -4.8% YTD having recovered somewhat from their worst start to a year since 2008. A slowing China, with GDP growth at 6.8%, and falling oil prices have been blamed. Talk of a global recession has impacted negatively on market sentiment but global growth and US growth are both at a modest +2.4%. We view markets as oversold with a macro environment that is not as bad as currently priced.

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Hassium Market Summary 2015

Global equity markets performed well in 2014 with the MSCI world +7.7%. US equity markets hit fresh highs, the USD rallied and Chinese equities had an incredible run into year-end. We also experienced a surprise rally in long dated treasuries and a dramatic sell-off in oil. So what happens next?

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Hassium Market Summary November 2015 - The 'Spectre' of China, Earnings and Central Banks

A shaken but not stirred market continues to trade higher with global equities now +2.1% YTD, emerging markets -10.7% YTD and China +14.6% YTD. Despite this, sentiment remains cautious and cash levels high. Maybe the good in Darth Vader on the 18th December can push markets even higher.

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Hassium Market Summary October 2015 - Rate Hikes Next Year

Investor sentiment remains cautious and cash levels high. Negative micro news around Volkswagen and Glencore has added to market uncertainty but the broader impact has, in our view, been overstated. Although negative sentiment is still lingering, markets have regained some of the Q3 declines with global equities now -0.9% YTD, emerging markets -9.2% YTD and China -0.1% YTD. We believe that the likelihood of an equity market rally into year-end has significantly increased.

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Hassium Market Summary July 2015 - Greece, China (and now oil)?

Despite events in Greece the MSCI World is still +3.0% YTD and the EUR has remained resilient around the 1.10 level. The Greek situation continues to cause concern. Despite the referendum result we remain optimistic that Greece will strike a deal with its creditors and avoid a disorderly exit from the Eurozone. Elsewhere in the world, Chinese markets have declined 20% from their 12th June highs on the back of valuation and liquidity concerns. Oil has declined dramatically on the back of increased supply concerns and inventory build-up. In Japan the Nikkei has performed as a result of QE and a weaker JPY though Japan’s future is still very dependent on a slowing China. Recent US economic data seems robust enough to keep the FOMC on track for a rate hike but given the dovish tone to the current market we expect rate hikes to come in December. Equity valuations around the world still look stretched with forward PE’s in the US at 17 and Europe 15. In Greece we see the ongoing uncertainty as a buying opportunity for European equities.

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Hassium Market Summary June 2015 - Greek talks go on (and on) and on.

Despite events in Greece, equity valuations and uncertainty around oil prices the MSCI World is still +6.3% YTD. The Greek situation continues to cause concern, but the EUR remains resilient suggesting a compromise deal will likely happen before the 30th June. If so we expect markets to trade higher short term and we are positioned accordingly. The FOMC meet later today but recent soft US economic data suggests no surprises though we do expect interest rates and bond yields to now rise faster than currently priced.

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Hassium Market Summary May 2015 - Earnings seasons, the USD and Greece

Despite events in Greece and uncertainty around the price of oil, markets continue to trade higher with the MSCI World +6.1% YTD. Q1 earnings season is now essentially over with an earnings beat ratio of 72%, though revenues missed with a beat ratio of only 46%. Results were somewhat skewed by lower oil prices and USD strength. Equity valuations now look a little stretched with forward PE’s in the US at 18 and in Europe 16. The USD also looks overvalued on a PPP basis against the Euro and Yen on the back of their respective QE plans and geopolitical events in Greece. Whilst interest rate hike expectations are being pushed back we anticipate the USD to remain range bound before strengthening into the second half of the year.

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Hassium Market Summary March 2015 - Are we in a bubble?

The answer is probably yes. Markets are up +5.1% YTD and over +42% since the beginning of 2013. Valuations look stretched with forward PE’s in the US at 18. This week the NASDAQ closed above 5,000 for the first time since March 2000. Over this last month there seems to have been a big story most days over and above corporate earnings, mixed economic data and ‘50 Shades of Grey’. The ECB announced its long awaited EUR 60bn per month bond buying programme, the SNB scrapped its 3-year EURCHF 1.20 peg and there’s been talk of a Grexit. Oil prices stabilised, equity markets hit fresh new highs and numerous central banks started easing. We now expect US rate hikes in Q3.

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Hassium Market Summary February 2015 - An eventful January but we see things improving

The MSCI world was down -0.6% in January. It was a volatile month with the Swiss National Bank (SNB) sending markets into chaos by scrapping the 3-year EUR/CHF 1.20 peg, the European Central Bank (ECB) announced EUR 1trn of bond purchases in a bid to stimulate growth and restore confidence to the Eurozone, the anti-austerity Syriza party won the Greek election and we saw a further 20% fall in the price of oil. Q4 earnings releases have so far been slightly better than expected and economic data from the US, China and the UK has been broadly positive though somewhat mixed.

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Hassium Market Summary November 2014 - Equity markets recover despite growth concerns

October was a positive month for global equities which advanced +1.1% despite the IMF downgrading global growth forecasts. In the US the S&P 500 was +2.3% for the month. Q3 earnings were positive with both revenue and earnings numbers topping lowered estimates. The USD strengthened and the Fed’s tone turned more hawkish following the end of QE3 and a strengthening labour market. In Europe the Euro Stoxx 50 lost -3.4% on the back of GDP growth concerns and ongoing worries around the Ukraine crisis. Japanese stocks were boosted +1.5% as the BoJ announced further rounds of QE. Despite global growth concerns and lacklustre data from China, the MSCI EM index was +1.2% with India and Russia +4.6% and +5.5% respectively.

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Hassium Market Summary October 2014 - A difficult month for most asset classes?

September turned out to be a difficult month for most asset classes with the S&P 500 down -1.6% despite a landmark 2,000 breach during the month. The Fed had a more cautious tone than expected with an emphasis on protecting the economy from downside risks despite a positive start to Q3 earnings, the anticipated unwind of QE, falling unemployment and improving GDP growth. In contrast Europe was up +1.9% supported by the promise of further intervention from the ECB and Japanese equities were +4.9% benefitting from a weaker JPY.

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Hassium Market Summary September 2014 - USD strength and equities trade higher

Equities closed August in positive territory with US and European markets up +3.8% and +1.9% respectively. In the US strong Q2 GDP numbers; +4.2% and strong Q2 earnings data helped push the S&P 500 above 2,000 for the first time, despite ongoing geopolitical tensions and seasonably low trading volumes. In Europe the crisis in Ukraine and stagnating growth in the Eurozone prompted speculation that the ECB would introduce further measures to support the region, boosting European equities. Emerging markets also advanced with the MSCI EM index up +2.3% on the back of low inflation data in China allowing the government to maintain stimulus plans, improving sentiment around Brazil’s upcoming elections in October, coupled with strong growth in the US and the prospect of lower borrowing costs in Europe.

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Hassium Market Summary August 2014 - Geopolitics drives markets lower

Equity markets lost ground in July for the first time since February. The MSCI World was down -0.9% with US and European equities falling -1.5% and -3.3% respectively despite US equity markets reaching fresh record intra-month highs. Trading volumes increased and volatility rose from a seven year low. Positive Q2 GDP in the US which came in at an annualised +4.0% after a very disappointing Q1 and double digit earnings growth pushed equity markets higher, supporting the argument for Fed interest rate hikes in the first half of 2015. Downgraded IMF global growth forecasts, expensive equity valuations and ongoing geopolitical events in Ukraine, Iraq and Gaza drove market sentiment and risk appetite lower. Emerging markets fared better up +1.4%, boosted by manufacturing data from China and the upcoming Brazilian election.

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Hassium Market Summary July 2014 - Interest rate expectations and Q2 earnings

Markets continued to gain ground in June with the MSCI World +1.2%. The S&P 500 and the Dow reached record highs albeit on the back of low volatility and light volumes. Equity market valuations look stretched and we are now anticipating a period of consolidation. As we enter Q2 earnings season we remain positive global equities but see limited upside short term. Geopolitical risks remain as events in Iraq escalate and the situation in Ukraine remains unresolved. In China a series of upbeat economic data releases helped support sentiment towards emerging markets and industrial commodities.

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Hassium Market Summary June 2014 - Is the equity rally sustainable?

May was a positive month for global equities with the MSCI World +1.9%. US equities reached new record highs albeit on lighter than average volumes. Last week’s eagerly anticipated ECB intervention caused core government bonds to rally with peripheral bond yields falling to record lows. Successful elections in Ukraine brought some stability back to the region. In China positive manufacturing data and government introduced measures to support growth boosted sentiment towards emerging markets which are now +6.5% YTD. We remain positive global equities but see only a modest upside from current levels.

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Hassium Market Summary May 2014 - How long can central banks hold off from raising rates?

April was another directionless month for global equities. The OECD cut its global growth forecast for 2014. Geopolitical events in Ukraine and China contributed to volatility. Q1 earnings season was positive on the bottom line but disappointing on the top line. More relevant in our view are current rate hike expectations and the weaker USD.

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Hassium Market Summary April 2014 - Q1 Earnings, stimulus and a less-hawkish Yellen

Despite geopolitical events in Ukraine and China March was a muted month for global equities which essentially traded flat with the S&P500 +0.8%, Stoxx600 -0.7% and Nikkei +0.6%. The annexation of Crimea remains a meaningful event though the main loser seems to be the Russian financial markets with capital outflows rising to over $60 billion in Q1. A continuation of outflows on this scale would likely drive the economy into recession. In China the markets remain focused on slowing growth and corporate defaults. The widening of the CNY trading band was significant though not a surprise given the government’s priorities around reform. We remain encouraged by China’s 7.5% growth target and their $3.8 trillion of foreign exchange reserves.

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Hassium Market Summary March 2014 - Markets slowly returning to normal...?

US stocks continue to hit new highs despite disappointing macro data from China and the ongoing conflict between Russia and Ukraine. Many investors are now questioning the Chinese growth story but we see this as a short term concern. Ukraine is a more meaningful geopolitical event which is likely to play out for many months. Oil and natural gas are key considerations as is the threat of international sanctions against Russia.

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Hassium Market Summary February 2014 - Emerging market confusion?

We see any pullback in global equity markets as limited. Recent events in Argentina and to a lesser extent in Turkey and South Africa have led to a sell-off in global equity markets with developed markets now -2.8% YTD and emerging markets -4.8% YTD. The events in Argentina have the potential to deteriorate further although we see contagion into broader equity markets behind us. While it’s not great news for emerging markets we see recent events as an opportunity for global investors to slowly allocate to riskier assets in the US and Europe.

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