The article discusses the recent volatility in the markets primarily influenced by contradictory information from the Oval Office regarding trade policy. Trump's tariff increase on Canadian steel sparked initial market jitters, which were briefly alleviated by a potential truce in Ukraine and Canada's withdrawal of electricity export levies. Despite these fluctuations, the overall sentiment remains one of risk aversion. Investors are increasingly trimming exposure to equities due to the unpredictable nature of US trade policies, leading to a focus on safe-haven assets like gold and Treasuries.
Another day, another bout of risk aversion, was the general vibe of trade yesterday.
We are still in the same place that we were 24 hours ago, grappling with incoherent, volatile, and bordering on insane policymaking from the Oval Office.
It is no surprise at all that participants continue to trim exposure to equities, as part of a broader de-risking of portfolios.
I'm happy to continue riding the momentum on all fronts for the time being - selling equity rallies, favouring further gains across the Treasury curve.
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