European Long Short macro and market update

26 November 2019

Quantitative analysis: Macro Matrix – tactical credit and economic indicators


Source: Martin Currie. Six month data as at 20 November 2019.

  • Yields have risen and curves have steepened a little due to hopes that looser monetary policy will help growth and inflation.
  • However, raw material prices continue to grind downwards.
  • Signs that inventory levels may be stabilising thereby putting less pressure on economic growth.

Qualitative analysis: Market Traffic Lights – providing a strategic view


Source: Martin Currie. Six month data as at 20 November 2019.

  • European PMI data continues to deteriorate and corporate earnings are likely to continue to fall both this year and next. Historical data suggests we should be near a low.
  • Global PMI data continues to be weak and combined with the ongoing tariff wars there is a real threat to global growth. Any agreements over trade, Brexit and digital taxes will be a positive.
  • Further interest rate cuts will reduce income via falling savings incomes. We have seen the German and French consumer raising savings as a result.


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