JPMorgan Likes Europe Corporates, Sees U.S. 10Y Buyers Dissipating

The video discusses the impact of interest rates and Fed meetings on the market, highlighting inflation concerns and central bank actions. It explores the challenges faced by emerging markets, particularly in response to tariffs and China's economic strategies. Opportunities in European high yield markets are examined, alongside corporate actions influenced by tax reform. The video concludes with insights into currency market trends and the dynamics of emerging markets.

What is the Federal Reserve's current stance on the Fed funds rate?

• They intend to keep it unchanged.

• They see room for an increase of 100 basis points.

• They plan to decrease it by 100 basis points.

• They are considering a decrease of 50 basis points.

What is expected to happen when quantitative easing converts to quantitative tightening?

• The long end of the market will price in more realistic inflation expectations.

• The bond market will remain unchanged.

• Inflation expectations will decrease.

• Interest rates will decrease.

How is China managing its economy in response to tariffs?

• By increasing the pace of deleveraging.

• By focusing solely on exports.

• By escalating the tariff situation.

• By reducing the pace of deleveraging and injecting liquidity.

What is the current opportunity in the European high yield market?

• It is less attractive than the US high yield market.

• It trades at a wider spread than the US high yield market.

• It trades at a narrower spread than the US high yield market.

• It is not influenced by Brexit or Italy.

What has been the recent trend in US corporate actions?

• Reducing acquisitions.

• Increasing share buybacks and dividends.

• Decreasing financial flexibility.

• Decreasing issuance of shares.

What is the expected impact of tax reform benefits tapering away?

• A decrease in corporate earnings.

• Continued enjoyment of a 14% reduction in tax rates.

• A 14% increase in tax rates.

• A complete loss of financial flexibility for corporations.

Which currency is considered stable if NAFTA proceeds?

• The British Pound

• The Japanese Yen

• The Mexican Peso

• The Euro