recap monthly MT GLOBAL M.PMI Jun2019 surveys - Business Confidence vs Markets thread 1/n

• most countries continue to weaken = #GlobalSlowDown
• Global index falls to 80M low
• market prices global central bank renew /continue dovish stance
• first chart: "breadth"

2/n Global M.PMI DM vs EM

• Global 49.6 80M low
• DM 49.5 80M low
• EM 49.6 36M low

all now < 50

(GDP weighted calculations)

3/n Global / DM / EM 5Y rolling pctl and Freight costs BDI YoY

• everyone expects global flush of liquidity, rate cuts, possible QE, to quickly stimulate way ahead of lurking recessions ?

4/n Global Manufacturing PMI heatmap Jun2019 surveys

5/n Global Manufacturing PMI vs YoY in relevance to world GDP contribution as of Jun2019

6/n Global M. PMI table overview DM vs EM

...just look at those 5Y rolling pctl...

= global disinflationary expectations, massive flight to quality (bonds, gold, JPY) and front running ahead of QE.

7/n Global M.PMI vs markets : Energies & Metals

• Palladium (auto industry switch) is "off scale" and mostly contributes to the overall metal divergence

8/n Global "big 4" US, Eurozone, China, Japan

• US is hanging in there ... so far

9/n Eurozone "big4" M.PMI Germany, France, Italy, Spain

• France indeed strong rebound
• Germany first sign of bottoming ?

10/n Global M.PMI vs $ACWI and EM PMI vs $EEM

11/n regional view vs markets: USA

• massive bond rally makes sense
• stocks making new ATH on rate cut dope completely diverging from business confidence itself which is rare.
• bonds pricing in recession, stocks already pricing huge confidence rebound later (FED & tariff)

12/n regional view sample: CANADA

• same story: bonds rally on dovish BoC, disinflationary sentiment, stocks follow SPX and diverge from own business confidence

13/n regional view sample: CHINA

• similar picture...and PBoC / CCP already injected $1.3trillion this year in new stimuli

14/n regional view GERMANY

• PMI "rebounds" to 45.0 4M H but deep in trouble = ECB to rescue

• Bunds rally without any end... -40bp now as front running and ultimate global flight to safe haven

• DAX as so many other indices diverged from own business confidence. leading?

15/n regional view FRANCE

• some may argue "curve-fitting", so what... at least M.PMI rebound to 51.9 9M high and would "justify" CAC40 move (sure, global correlation to DAX, SPX etc too)

• OATs rally of course too

16/n regional view ITALY

• this is quite something !
• PMI 48.4
• MIB rallied strongly recently (especially banks), as BBB rated BTPs buyers are not stoppable (front running for ECB QE). now back to 1.68% for ONE REASON ONLY.

17/n regional view UK

• PMI got slammed to 48.0 80M low with own hard BREXIT fear contributing to global PMI weakness

• Gilts rally for same reasons mentioned before. disinflation. dovish BoE. global slowdown.

18/n Eurozone M.PMI vs Creditspreads

• business confidence (was) on the floor, small rebound mostly due to France
• ITRAXX Main (Corps) or Financials stood firm , never sold off because of FED/ECB/PBoC/BoJ/BoE/RBA/RBNZ/BoC and everyone else placed their CB PUT.

19/n anyways... enough for now...

happy #IndependenceDay2019 USA ! 🇺🇸💥🎉