- Still very positive on equities after strong US earnings
- Sentiment also boosted by Beige Book outlook
- European equities also looking good; ABB outperforms
- Novartis results in line and outlook held steady
- Nestlé slightly better than expected
- Yield now curve at its flattest since 2017
- US leading index seen slowing down in March
By Clare MacCarthy
Editor's note: Due to international travel commitments today's Morning Call takes an abbreviated form with just one participant – Peter Garnry, Saxo's head of equity strategy. But it's still very much worth a listen in order to hear why stocks are rallying globally.
"We remain very positive on equities this morning, as expected, we had strong earnings in the US which has so far have bolstered sentiment. The Beige Book yesterday also confirmed a positive outlook for the US economy
. I expect equities to remain positive and go higher this week and especially next week which will see tech earnings. So be careful about shorting equities at this point in time," Garnry says.
The positive undertone has spilled into Europe and three regional heavyweights – ABB, Novartis and Nestlé – have either matched or outdone their earnings expectations.
Meanwhile, the ever-flattening yield curve is an increasingly urgent topic of conversation and the spread between US 5-year and 10-year Treasuries is now at its flattest since 2007. Still, incoming NY Fed President John Williams said he was not concerned at this point.