April 17, 2023
United States:
Morgan Stanley Strategist Sees US Stock Rally at Risk
The rally in the S&P 500 has been driven by only a handful of stocks, putting the index at risk of fresh lows if bond yields rise, according to Morgan Stanley’s Michael Wilson — one of the most bearish voices on Wall Street.
The percentage of stocks outperforming the S&P 500 on a three-month rolling basis is the lowest on record, Wilson said. That “is the market’s way of warning us we are far from out of the woods with this bear market,” the strategist — who was ranked No. 1 in last year’s Institutional Investor survey for correctly predicting the stock slump — wrote in a note.
Europe:
Europe at Risk of Funding Crunch After Bank Turmoil, APG Warns
Europe is facing the danger of a lending squeeze following the recent banking turmoil, according to the continent’s largest pension-services provider.
“The risk of a credit crunch is there and it certainly increased” after the collapse of several US regional banks and the emergency takeover of Credit Suisse Group AG, said Thijs Knaap, chief economist at Netherlands-based APG Asset Management.
Asia:
Singapore’s Policy Pause Sets Stage for Local Dollar as Funding Currency, HSBC Says
The Monetary Authority of Singapore’s policy pause last week paves the way for the local dollar to become a funding currency, according to HSBC Holdings Plc.
The Singapore dollar’s outperformance is set to fade following the decision and the currency may start to track the greenback’s moves, Joey Chew, head of Asia FX research, wrote in an April 14 note. Against this backdrop, there may be growing market chatter about when the MAS will begin easing, she added.
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