Bloomberg Intelligence, FED, United States discussed on BTV Simulcast
With the three F's Ouchi. The Fed on FedEx doing well out of a crisis to the markets is the best. Quarter since 1998 for the S and P 500. Are you at the beginning of the second phase of recovery as Gina Martin Adams, our equity specialist here at Bloomberg, Intelligent are so it is the best quarter since 1998 even though there's an implosion and earnings of 40% Sell side profit forecasts have likely bottomed. That is the view from Bloomberg Intelligence. Morgan Stanley says profit forecast will gain upside momentum on Can Accord say $165 is on the card for 2021 but the foci risk and the Fed Minutes are the dominant themes of the day. Yeah, In a couple of other important points here, you've got W one not batting an eyelid after Donald Trump tweeted that he was angry at sign over the pandemic pretty high bar these days to make a jump around. In any case, the country drawing condemnation from around the world over this new Hong Kong security law that way as well. Part of the reason markets Lifetime stipulated the growing reserve role and the relative stability off the one trade. Saudi oil exports slumping pie 10.7 million barrels a day in June. It is the lowest in more than three years. At the moment, we're up a little bit over 1% on the Brent trade. You have an OPEC output decline this speculation from the folks of J. B. C, but it is, of course, the best quarter in 30 years for oil for W, specifically rebounding from those historic lows back in April. Let's get to our top story in more detail. The US virus expert Anthony Fowzie is the latest to offer a dire warning on the pandemic. He told lawmakers on Capitol Hill that the country is quote going in the wrong direction, adding the infections could more than double toe 100,000 day. The numbers speak for themselves. I'm very concerned, and I'm not satisfied with what's going on because we're going in the wrong direction. If you look at the curves of the new cases. So we really got to do something about that. And we need to would quickly short answer question is that clearly we're not in total control right now. With the Fed church around power also highlighted the need. Teo get the virus under control A signs point to longer than expected crisis Now, he stressed the imperative to Congress in a joint testimony with the Treasury secretary Steve Mnuchin. Hypothetically a second outbreak. Could you know force governments and force people to withdraw again from economic activity, and I think the worst part of it would be to undermine public confidence. There appears to be bipartisan support in the Senate to repurpose 130 billion For P P P. Extending it to businesses that are most hard hit will be watching as regular Main Street, you know, fully comes online and continuing to look to see whether their ways we can improve it. Would you support additional legislation and look forward to working with both the House and the Senate so that we can pass? Legislation by the end of your life. Still, the jumped another 1.5% in the last trading day off the first half, rounding out the best quarter since 1998 adding to the optimism US consumer confidence posted the biggest increases 2011 in June. The sentiment remains well below free pandemic levels. Next up on the docket got the Fed minutes. Manufacturing data. A key U. S jobs Data's well, Let's bring in. Shane Oliver is the capital Investors, chief economist and head of investment strategy say. Welcome back to the program. Let's get straight to some revisions on economic forecasts from folks of Bloomberg intelligence. The chief economist, came out with a new report. He is basically revising downwards the outlook for 2020 global GDP to a contraction of 4.7 from 4% last round. Here's the key takeaway. Goodbye. Victory V. Hello, Worry W most major economies have not met the necessary conditions for a V shaped recovery longer lasting lockdowns ceiling on activity for contact intensive sectors, scarring, impact of high unemployment and stimulus that in some parts of the world is falling short. They all weigh on the outlook, agree or disagree. In a big picture. Since I agree. I'm not totally sure it's going to be a W though I probably describe it more as a square rigger. Go to recovery. We had that huge slump we've had about spec. Some indicators like some PM eyes US Recall Stiles look a bit like a dick. But I think that going forward is going to give light to something a lot slower. And a look, Claire. Um, obviously, if we see a renewed and generalized shut down in the U. S and major countries around the world, then we'll get a W. But I think in the absence of that it's more likely a square root. Fischel belts and then very gradual recovery there after the emphasis being on gradual Okay, so I started off by talking about the S and P The best runner in this superlatives Come flying, don't they? For this quarter? I won't understand. To achieve a 20% escape velocity on equities from depression to euphoria and that speed do you think the momentum in stocks needs to pause? Because of these involving hot spots does the velocity of this recovery slowed? Ein I think it certainly does. What we have seen is not that unusual in a historical context coming out of major bear markets, and we did 34% decline in the S and P 500. You tend to get a huge bounce back is invested side. Well, not as bad as we see it and the main Tom, we've got laryngitis rights and message. Fiscal stimulus. They hit this bat's back. In the markets get overboard, Then they got through with a correction and then, after a while, once the overboard conditions are worn off, will work through the market continues to recover. But I think you have to allow that this spate of the recovery of the last quarter does reflect the state of the full. We sell. We sold between light February in light March, and that was something similar happened back in 1990 cm crosses. Then you get this mess agree bound into the end of the year. It's always something like that. But then it gives light to a more modest kind, if not a correction, which I think is what we're saying at the moment. And Shane. The stock Bulls definitely need evidence that going all in on this bull market was worth it. Research from the folks at RBC Capital Markets Point to an indicated that measures to share of analyst earnings revisions. And that shows the move to the upside to the tune of about 52% which is the first time the measures surpassed 50% this year. Our analysts and forecasts getting a little bit ahead of themselves. What you say. I could, baby. But then I probably got two negatives Capital months back when I were rapidly revising down. I think analysts, economists and the central bank civil but struggling with precisely what's going on here. On that leg, too, added volatility, and it goes in both directions. I think a lot of the economic forecast that economists reporting out couple of months ago with two negatives. Then I think they got a little bit too positive a little bit too complacent, and now they're getting a bit more getting revised down again. I think we got to say that continuing and that's because we're dealing with something that we don't fully understand The Corona bar If you want to get looked like it was starting to come on to control us started to re open. Turns out they moved too quickly and without paying enough attention to the circle guidelines for reopening America again. Which is what he has been on about some time now and on with saying the result of that. Well. The results are also prime mediating in the Pew Online research. This is about Biden and Trump. I just want to get you a sense that I know a great deal can happen between now and election Day..