The week kicked off on a bearish note for US equities as the buying that had been driven by hopes of a turnaround in trade winds over the past nine sessions is gently losing momentum. In FX, the US dollar remains softer across the board; its rapid selloff against Asian peers was particularly in focus over the past two sessions and raised concerns about the dollar’s status as a safe haven and reserve currency.
The Federal Reserve (Fed) starts its two-day meeting with no expected change to its policy this week, while earnings are not looing bad but forecasts are souring sentiment. From here, the lack of good news on the trade front will likely discourage bulls from extending the latest rally. Yet, I firmly believe that optimistic investors are positioning to catch the moment when potential tariff deals pop and trigger a rebound—they just don’t want to miss the...
