Spreadex Market Update

US stock indices see higher returns than relative European outflows.



The theme of Europe underperforming the US has indeed continued into the end of the week, as US stock indices drive returns higher against relative outflows from Europe. UK listed equities in particular have underperformed since Carney guided the recovery as stronger than originally thought. This saw investors sensitive to assets purchases pull capital from London-listed stocks in favour of cash and equities still the beneficiary of firmly loose monetary policy.

Gold remains unloved and has demonstrated why Goldman favours short positions. The yellow metal arguably has a lot of what could drive it higher already priced in, with many participants believing the likelihood of further currency debasement through increased assets purchases as unlikely. This would likely have the effect of harming gold prices in the absence of any other drivers.

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