August 16. Asia lower, but bouncing elsewhere
–Yields pushed lower yesterday on a ‘risk-off’ theme sparked by emerging market concerns (but we’re seeing ‘turnaround Thursday’ so far this morning). US tens fell 4 bps to 2.85%. While Turkey’s currency bounced, the broader issue of EM USD-denominated loans is leading to stress. Is it tariifs, or is it the gradual withdrawal of dollar liquidity being engineered by the Fed? In any case, Asian markets continue to press lower, with SHCOMP, Hang Seng and Kospi at new lows. The Shanghai Comp is down nearly 25% from the high in January; it’s hard to imagine the sort of angst that would grip the US if SPX were to fall 25% in the next six months. How about DOW 19000 instead of DOW 25000? Tencent hammered today on slowing profits; a dent in tech.
