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Following a rapid-fire review of issues related to household balance sheets, durable goods demand, the impact of tariffs, DOGE’s capacity to move the budget needle and the labor market’s ongoing cooling, we reiterate our defensive asset allocation recommendations.
It has been three days since Israel started its air campaign against Iran. We now have greater visibility into Israel’s targeting, as well as Iran’s retaliation. Israel’s air force has struck almost every single Iranian nuclear program facility, government buildings, research centers, and – most importantly – energy facilities. Most of these targets are expected, but the attacks against Iran’s energy facilities are concerning as they suggest that Tehran may have casus belli to strike back at the energy facilities strewn around the Persian Gulf.
The conflict between Iran and Israel continues. There will be ample time to update our views on the specifics of the kinetic action. Thus far, Iranian retaliation has been confined to Israel, which according to our hierarchy of potential responses, is the least market relevant.
In this FX note, we provide a rationale for why it is important to pay attention to technical indicators, while still keeping your eyeball on the structural factors that drive currencies. This report answers the following questions: 1. Should you buy or sell the USD over a three-to-six month period from the pure lens of our proven technical indicators and 2. What are the best tactical cross trades among currencies.
An intriguing dichotomy is emerging in how the US government has responded to Israel’s attack against Iran. First, following the attack, Secretary of State Marco Rubio issued a terse statement denying US involvement.
Investors should hold gold, build up some cash, tactically overweight US equities relative to global, and prepare for at least minor oil supply shocks – possibly major shocks – as the Israel-Iran war escalates.
This week our three screeners explore equity trades in Robotics, European Quality and Technical, and Hong Kong.
Israel has taken unilateral action against Iran on June 12. According to the media reports, the following are the key developments: Israel has attacked multiple targets across Iran, including in the capital Tehran. Israeli Prime Minister Benjamin Netanyahu has stated that the Operation Rising Lion would “continue for as many days as it takes to remove” the alleged Iranian nuclear threat. The US has stated that it did not participate in the attack, calling Israel’s action unilateral.
The perfectly synchronised moves in US, Japanese, German, and UK 30-year bond yields through the past two months are odd… and irrational. These irrational moves present compelling investment opportunities.