NAB Morning Call

Thursday 21st January 2021Former President Donald Trump often remarked about how his administration saw record highs in US equities. If the President has any control over that, Joe Biden can make the same claim, with new highs on the NASDAQ and S&P500 right from his first moment in office. Today we look at the risk-on mood of inauguration day and ask will it last. Could a bad set of weekly employment numbers later on dampen the mood? Plus, rising infection numbers in China, largely ignored by the markets so far. Phil Dobbie also asks NAB’s Tapas Strickland what we can expect from employment numbers in Australia today. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 20th January 2021It’s Inauguration Day, or it will be when Wednesday eventually ticks round in the US. Lady Gaga will sing the National Anthem before Biden moves into the Oval Office and works his way through his executive orders. Ahead of that, we’ve heard from Janet Yellen, the nominee to be Treasury Secretary who said the administration needs to act big to help those struggling through the COVID crisis. Phil Dobbie talks to NAB’s Ray Attrill about the market reaction to her words. They also look at bank earnings and rising confidence in Germany, as well as looking ahead to the UK’s CPI figures later, plus the Bank of Canada meeting tonight. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 19th January 2021Markets are looking through the prospect on any unrest on inauguration day, but the more immediate question is what with the President do today? Reuters is reporting he is withdrawing licences from any companies working with Huawei, is anything else in the offing? NAB’s Tapas Strickland says it doesn’t really matter too much what the President does, because it can always be undone in the days that follow. The bigger question is what will Biden’s attitude be to China? There’s also discussion on today’s podcast about yesterday’s GDP numbers for China, expectations for the ECB meeting this week and political unrest in Italy. Hosted on Acast. See acast.com/privacy for more information.

Monday 18th January 2021Markets responded at the end of the week to Joe Biden’s proposals for stimulating the US economy. As NAB’s Rodrigo Catril points out in today’s Morning Call, markets questioned the President-Elect’s ability to implement his pandemic relief spending plan while Biden also noted everyone will have to pay their fair share. Soft US data and US banks underperformance didn’t help sentiment either. A safe-haven bid lifted the USD and weighed on longer dated UST yields. Otherwise, the continuance of disturbing infection rates for COVID-19 quell optimism everywhere, with the UK stepping up it’s measures on inbound travellers. There’s also discussion about Australia’s housing market – could prices really rise by 30 percent in the next few years? Hosted on Acast. See acast.com/privacy for more information.

Friday 15th January 2021Bond yields were already on the rise before Fed chairman Jerome Powell talked down the likelihood of any easing in bond purchases this year. NAB’s Gavin Friend says he indicated the Fed would look through any short-term rise in inflation as a reason to make changes. This has added to a positive market sentiment today, despite a disastrous rise in US jobless claims, up from 784k to 965k in one week. There’s also discussion today on the ECB minutes, German GDP, NAB’s payments data and an exodus from the UK. Today, all eyes will be on what Joe Biden has to say. It’s a busy first week back! Hosted on Acast. See acast.com/privacy for more information.

Thursday 14th January 2021An ensuing impeachment of the US President continues to be of little concern to the markets, with more focus on the words coming from central bankers. NAB’s Tapas Strickland talks about the continued fall in bond yields, as Fed speakers downplay the prospect of tapering of bond purchases later this year, aided by subdued US inflation numbers. All eyes will be on Joe Bidens stimulus plans and how much extra money he plans to pump into the economy. Meanwhile, Aussie job numbers have gone through the roof and Italy's government is on the verge of collapse. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 13th January 2020With yields rising there’s been a question mark over whether the appetite for treasury bonds is falling, ahead of trillions expected in new government debt. On today’s podcast NAB’s Rodrigo Catril says the issuance of Treasuries this morning indicates the opposite may be true, with yields falling – the first decline since the beginning of the year. There’s also discussion on the easing of loans in China, the latest tit for tat measures between China and Australia, and what to expect from US inflation numbers tonight. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 12th January 2020Bond yields continue to rise In the US as markets prepare for an expected multi-trillion dollar stimulus package from the President-elect. We’ve seen bond yields hit new highs, as equities start to fall. Phil Dobbie asks NAB’s Gavin Friend whether political uncertainty is behind any of these moves, including a fall in equities, admittedly from record highs on Friday. Meanwhile, Aussie retail sales looked strong yesterday, although the US dollar-strength saw the Aussie dollar lose ground. Could tensions with China also be playing into that weakness? Maybe the issue will go away when Donald Trump leaves the White House. Hosted on Acast. See acast.com/privacy for more information.

Monday 11th January 2021The Morning Call is back, and the new year has kicked off in a very different place. The blue-wave wasn’t written in stone, but with control of the Senate the Democrats should find it easier to roll out more substantial stimulus measures, so does that mean the US economy will recover faster? Phil Dobbie talks to NAB’s Ray Attrill about the response in the bond markets, with Treasury yields rising markedly. But is there a risk that the expectation of a US recovery is overblown – after all COVID numbers continue to rise and there’s still a gargantuan task in rolling out vaccines. Given all that’s been going on, how have NAB’s forecasts changed over the last few weeks? Hosted on Acast. See acast.com/privacy for more information.

Tuesday 22nd December 2020You might have expected a positive market response as the US politicians reach agreement on a fiscal stimulus bill, particularly as Europe became the latest region to approve a vaccine. NAB’s Ray Attrill talks through how sentiment has rapidly switched direction. Investors have tended to look through short term concerns for the optimistic longer-term outlook, when COVID-19 is but a distant memory. But the rise in numbers in the UK and fears of the new strain that spreads faster has led to a sudden realisation that the short-term downside might last longer than expected. Then there’s Brexit – check back next week on that one. Hosted on Acast. See acast.com/privacy for more information.

Monday 21st December 2020There’s a strong expectation that the US fiscal stimulus deal will be resolved in the next few hours. NAB’s Rodrigo Catril says the news will be good for risk assets helping equities recover and reflected in emerging market currencies. It’s a different story in the UK, of course, where the new strain of COVIDS-19 has seen London, large parts of southeast England and Wales moved into lockdown, and many European countries stopping flights from the UK. That’s being compounded with the lack of movement on a post-Brexit deal, but could the turn-for-the-worse on COVID force the UK and EU to reach a deal quickly, to cope with the other matter at hand? Hosted on Acast. See acast.com/privacy for more information.

Friday 18th December 2020The post-Brexit trade deal and the US fiscal stimulus deal have been pushed back time and time again, but we really are at the point of no return. NAB’s Gavin Friend says there will be a deal in both instances, and the markets are priced accordingly. The US fiscal stimulus deal might mean politicians meet over the weekend, whilst UK MPs, already on their Christmas break, could be pulled back after their roast turkeys to sign off on their deal. Central banks have been squeezing in their final meetings of the year – the Bank of England unsurprisingly pessimistic, but the Swiss National Bank and the Norges Bank, both more upbeat. There’s also discussion on yesterday’s unemployment numbers for Australia, and the mid-year budget update yesterday. Hosted on Acast. See acast.com/privacy for more information.

Thursday 17th December 2020The US dollar slid overnight as US retail sales figures for November were released. The numbers “were grim” says NAB’s Gavin Friend on today’s Morning Call podcast. Sentiment turned more positive as the session progressed, with rising hopes that a fiscal stimulus deal is imminent. There’s also hope that a UK-EU trade arrangement is getting close, with Ursula von der Leyen saying there is a path to a deal. The FOMC met and announced no changes to interest rates or bond buying. Their forecasts see this year a little less bleak for GDP, and a big stronger than previously forecast for 2022. The Bank of England is also expected to sit on its hands tonight too. The US weekly job numbers are also worth watching – new jobless claims have been rising recently. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 16th December 2020Equities have climbed higher in the US and in Europe on the hopes that two deals will be struck this week. NAB’s Rodrigo Catril talks about the market response to a tweet from the BBC’s Nicholas Watt, suggesting there was a buzz around Brexit talks and a resolution could be close. There’s also renewed hope that the text for a fiscal stimulus deal will be agreed in the US. We might hear progress on both of those in the next few hours … or maybe not! Aside from all that, tomorrow morning’s question will be, what next from the FOMC? There’s some discussion on that in today’s podcast. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 15th December 2020The markets lost some of their mojo today. They kicked off well as the US starts its vaccination program, but the UK health secretary upset the apple cart by announcing that the rise in infections in and around London has been attributed to a new, faster-spreading variation of the virus. As NAB’s Ray Attrill point out, there is no suggestion that vaccines won’t be responsive to the new strain, but it could mean we see more lockdowns and restrictions – as evidenced by Germany, London and, potentially, New York. There’s hope a fiscal stimulus deal will be reached in the US this week, with the wording for a potential bill to be released in the next few hours. China’s activity numbers will be the main data point today. Oh, and Brexit talks continue. Hosted on Acast. See acast.com/privacy for more information.

Monday 14th December 2020The inoculation program in the US has ambitious targets. NAB’s Tapas Strickland says the aim is to have given the jab to 75% of the population by June. Even so, markets were a little subdued on Friday, as infection numbers continued to rise in the US and across Europe. Germany has announced its most pronounced lockdown so far, starting Wednesday. Meanwhile, Brexit hopes linger on, with Sunday’s deadline pushed back and negotiations continuing. That’s helped cable this morning, even though Boris Johnson has reiterated no-deal remains the most likely outcome. There’s also discussion on today’s podcast about the US stimulus, the FOMC meeting this week, Australia’s MYEFO and the rising price of iron ore. Hosted on Acast. See acast.com/privacy for more information.

Friday 11th December 2020Even though a hard deadline has been set for Sunday for the UK-EU trade deal, there’s no guarantee it will all end there. NAB’s Gavin Friend says a no-deal could weaken the pound and soften the Aussie dollars chances of maintaining its position over 75 US cents. The ECB has announced more bond buying, whilst the EU has managed to broker a deal to pass its budget, including the Recovery Fund, using the age-old EU technique of kicking the can down the road. The US is also obfuscating on the fiscal stimulus package as virus numbers continue to rise. Hosted on Acast. See acast.com/privacy for more information.

Thursday 10th December 2020As we recorded this morning’s podcast Ursula von der Leyen and Boris Johnson were meeting over dinner to discuss the progress of the UK-EU trade deal. NAB’s Rodrigo Catril predicts there will be no definitive outcome tonight, but it remains unlikely that the UK will accept what the Europeans are putting on the table. The EU will also have difficulties tomorrow as it tries to pass its budget and the Recovery Fund. More significant for us is the outcome of the ECB meeting. Rodrigo says any indication for how long the central bank continues its bond buying program will have repercussions for the RBA. US equities saw sharp falls today as infection rates rise and the passage of a stimulus deal this year seems to be slipping away. Hosted on Acast. See acast.com/privacy for more information.

Wednesday 9th December 2020The UK has started injecting people with the COVID vaccine. If only they could inject compromise in the UK and EU negotiators who remain a long way from reaching a deal. The chances are slim according to Michel Barnier, as Boris Johnston travels to meet Ursula von der Leyen Wednesday night (Thursday morning AEDST). No deal, plus the potential blocking of the EU budget by Poland and Hungary could make for a very disappointing EU summit at the end of the week. Meanwhile,. There’s no progress on a fiscal stimulus package in the US, but as NAB’s Tapas Strickland points out, even if there is a smaller than anticipated deal, it’ll be the bridge to a larger deal after Joe Biden takes office. On today’s podcast there’s also discussion on yesterday’s NAB business survey and today’s China GDP ands PPI figures. Hosted on Acast. See acast.com/privacy for more information.

Tuesday 8th December 2020The UK-EU trade deal really is going right down to the wire – and the wire itself keeps getting pushed back. On today’s Morning Call NAB’s Rodrigo Catril says the decision to hold a face to face meeting between Boris Johnson and Ursula von der Leyen means the decision will be reached in coming days, not in the next few hours. We might see a version of the $908b fiscal stimulus package in the US in a short while, though, although even here differences remain. Locally, yesterday’s downgrading of NSW and Victoria’s credit rating will push up borrowing costs, but the states will emerge from COVID-19 better placed than most parts of the world. Today’s NAB Business Survey will show how much confidence there is in the economy right now. Hosted on Acast. See acast.com/privacy for more information.