Wyn Thomas - Axys Investment Management

Weekly Market Commentary 10th May 2019

NEW TARIFFS MARK LAST GASP BID TO FORCE TRADE DEAL

This week the collapsing state of US-China trade relations has roiled markets. Talks appeared to have broken down after US trade negotiator, Robert Lightizer, accused China of reneging on what little the two countries had already agreed on. The opening shots in a new trade war have already been fired, with President Trump confirming he’s increasing tariffs on $200bn worth of imports. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 3rd May 2019

FEDERAL RESERVE CHAIRMAN CONTINUES TO DEFY MARKET EXPECTATIONS

This week, while we await the results from local council elections, there was a chance to indulge in the sport of interest rate speculation; an old favourite from “the before times” when simple things like the strength of the global economy were all we had to worry about. New Federal Reserve Chairman Jerome Powel is proving to be a difficult opponent, with a knack of contradicting himself every few weeks and shaking off the pack who might have been coming close to guessing his next move. On Wednesday he wrongfooted a market that had become over confident in an upcoming rate cut and sent equities into a bit of a panic. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 26th April 2019

EUROPEAN ELECTIONS PUTS BREXIT TALKS ON HOLD

This week, after a delightful break, we get back to Brexiting. True to form, whatever small signs of progress there might have been have evaporated after cross party talks were reported to have ended without progress; it looks likely now that nothing will happen until after the elections. While the European elections are getting all the attention, the more interesting contest is in the local council elections. While the European elections will be fought between Brexit focused fringe parties, that isn’t indicative of a general election. If the Tories get wiped out in the local elections however, that will likely focus the minds of government MPs. A credible opposition threat might stop the party from fighting with itself and unify around a compromise position. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 12th April 2019

BREXIT DELAYED UNTIL OCTOBER

This week the Brexit saga took another step towards its ultimate outcome, dragging on into infinity. A conditional delay to the end of October 2019 is welcome but unlikely to change anything. Hopefully government will use this time to come up with a workable solution, but don’t be surprised if we have to beg for another extension after this one. The hard-irreconcilable truth is that a desirable Brexit isn’t deliverable either by WTO, reopening the withdrawal agreement or any other means, and a deliverable Brexit isn’t desirable, as Theresa May discovered in three separate Commons defeats. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 5th April 2019

EUROPE’S LARGEST MONEY LAUNDERING SCANDAL

This week we take a brief Brexit respite to focus on what could be the biggest money laundering scandal in history. Between 2007-2015 around €200bn of non-residential flows was passed through Danske Bank’s Estonian branch unchecked. The Danish firm bought Sabro bank in 2007 to expand its Baltic operations but was warned prior to purchase by Russia’s central bank of fraudulent activity which it ignored. Subsequently, the branch wasn’t onboarded onto the groups IT platform in 2008 to save costs which meant the branch didn’t have to adhere to anti-money laundering procedures. In 2011 The region generated 11% of profits even though it accounted for 0.5% of the bank’s total assets. Read more…

Wyn Thomas - Axys Investment Management

Quarterly Market Outlook Spring 2019

REVIEW OF THE PAST QUARTER:

Markets have rebounded from last quarter’s selloff as investor sentiment picked up. This has been driven by a perceived change of heart at the US Federal Reserve where it is expected they will stop hiking rates and become more cautious. In addition, thawing tensions between the US and China have helped boost hopes of a deal but key stumbling blocks, such as digital trade, remain and could yet see hostilities drag out. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 29th March 2019

PARLIMENTARY VOTES MAKE BREXIT NO CLEARER

This week we have had yet more votes on Brexit and are still no clearer about what will ultimately happen. As we write this the government is having yet another go at getting its universally despised deal over the line, but this time with the fun twist that her replacement gets to tear up whatever has been agreed and plunge us all back into darkness at a later date. At this stage it looks unlikely to pass and a longer extension will be required while the Commons cobbles together a compromise that it can live with and possibly puts back to a confirmatory referendum. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 22nd March 2019

EU OFFERS BREXIT EXTENSION

In what is fast becoming a real-life soap opera, this week’s episode of Brexit saw the narrative pick up the pace. John Bercrow kicked things off by quelling Theresa May’s “if it doesn’t work try try again” approach of pushing the same deal through only to get continuously rejected by parliament. Theresa May then managed to rile up Parliament blaming MP’s for the mess and attempting to win over the public. With three million people signing the petition to repeal Article 50 and a march planned this Saturday in London, it appears that she has lost both sides of the dressing room. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 15th March 2019

WILL THE EU AGREE TO A LONGER EXTENSION?

This week we have to turn our attention yet again to Brexit. After a series of votes and high political drama it came as a surprise to no one that we find ourselves in exactly the same position as before. Theresa May has been told again that her deal is the worst of both worlds, simultaneously too hard and too soft, yet is pressing ahead regardless and looks set to put it to yet another vote next week. Meanwhile the headline development of taking “No-Deal” off the table is also meaningless. While No-Deal is now no longer the official policy of the government, it’s still going to happen unless parliament can agree to something else. Read more…

Wyn Thomas - Axys Investment Management

Weekly Market Commentary 8th March 2019

US-CHINA TRADE WAR TAKING ITS TOLL

This week we received further evidence of the US-China trade war taking a toll, with data showing Chinese exports reportedly dropping 21% year on year. While some of this is down to a slowing global economy, the falling out with Donald Trump isn’t helping. This comes alongside data showing that Russia has massively increased its global share of soybean exports, largely at the expense of US farmers who have been targeted by retaliatory Chinese sanctions. With the extent of the mutual harm the dispute is causing now more evident, it is unsurprising that both sides seem keener on reaching a deal. Read more…