top of page

Let's Talk Pivot...

BentinPartner Weekly

Stocks rallied last week on generally better-than-expected earnings reports, signs that inflation starts to moderate and news that the UK government scrapped all its mini budget, at the same time as the UK finance Minister resigned, leading GBP and the UK Gilt market to move away from panic state.

Also supporting the market on Monday was M. Wilson, Morgan Stanley well known bear analyst, calling for a technical rally and a BoA study showing that cash holdings are at their highest since 2001 around 6.3%. Another potential catalyst on the upside was said to be seasonality with October historically a good month for equity markets to bounce.

That being said, falling leading indicators are also pointing towards recession which if it occurs do not favour a long-term bottom to equity markets.

Lizz Truss announced resignation on Thursday came with little effect as the mini-Budget had already been scrapped.

Oil also pulled back after an additional 15mn barrels were released from the strategic US reserve, bringing it down to 1984 levels at the same time as OPEC remains short 3.6mn of its targeted supplies.

Risk appetite was also bolstered late last week on talks (originating from a WSJ article) of reducing the pace of rate hikes after the dollar rallied 15% so far this year wreaking havoc in DM (Japan) and EM countries alike which is forcing them to sell record amounts of US Treasuries causing yields to rise which led. L. Summers to suggest the Fed may lose control of the bond market at the time as debt explodes. San Francisco Fed President Dailey said that slowing the pace of hikes would “preserve market structure”. St Louis Fed President Bullard also said that he expects a deflationary process to start in 2023.

As regards China and the outcome of the National Party Congress, all doubts were lifted after the speech of China’s Premier Xi warned of “grave international developments not seen in the past 100 years”, making clear that the objective of the China/Russia axis is to forge a new world aimed at countering the US overarching power and influence. Clearly the restrictions brought by the US on chip exports to China were seen as hitting a nerve with China now expected to retaliate on areas of importance to the US economy.

On Friday, Japan was seen intervening aggressively in support of JPY during European lunch hours after USDJPY broke 150 and swap rates jumped and disjointed with JGB 10-year yields pegged at 0.25%. This rate of 0.25% had also been tested on Wednesday and index swaps are seen pricing an end to negative rate policy around the time Kuroda will step down in April. By sticking to its guns for so long, the BoJ is now accumulating pressure on the system to the point that “the slight inflection of its ultra-loose policy risks setting wrecking ball in motion through worldwide markets”, Bloomberg commented. And the question is whether, the boiling keg will hold the pressure until April.

Some cracks appeared in the Western alliance over the week end after French President E. Macron lashed out at the US accusing it of double standards for selling gas to Europe at 4 times the price it sells it domestically. Also coming out of the woods was former French President N. Sarkosy saying that EU policy regarding the conflict in Ukraine is driven by “miscalculation, anger, superficial reactions” and because of this “we are dancing at the edge of a volcano”. He also said that “the European Commission is primarily an administrative body” and that he has “not yet understood under which article of the European treaties, U. von der Leyen justified her competence in the field of arms purchases and foreign policy”.


Click on the Picture below for our latest Leaders & Laggards Report:

Over the past week, the S&P500 rallied 4,7% (-21,2% YTD) while the Nasdaq100 rallied 5,6% (-30,8% YTD). The US small cap index rallied 3,5% (-22,4% YTD). AAPL rallied 6,4% (-17,1%).

Cboe Volatility Index sold off by -7,3% (72,4% YTD) to 29,69.

The Eurostoxx50 rallied 2,8% (-17,0%), underperforming the S&P500 by-1,9%.

Diversified EM equities (VWO) rallied 3,1% (-25,7%), outperforming the S&P500 by -1,6%.

The Dollar DXY Index (UUP) measuring the USD performance vs. other G7 currencies dropped -1,1% (17,5%) while the MSCI EM currency index (measuring the performance of EM currencies vs. the USD) dropped -0,4% (-9,0%).

10Y US Treasuries underperformed with yields rising 20bps (271bps) to 4,22%. 10Y Bunds climbed 7bps (259bps) to 2,42%. 10Y Italian BTPs dropped -4bps (358bps) to 4,75%, outperforming Bunds by -2bps.

US High Yield (HY) Average Spread over Treasuries dropped -15bps (224bps) to 5,07%. US Investment Grade Average OAS dropped -2bps (79bps) to 1,79%.

In European credit markets, EUR 5Y Senior Financial Spread dropped -9bps (81bps) to 1,36%.

Gold gained 0,8% (-9,4%) while Silver rallied 6,3% (-16,7%). Major Gold Mines (GDX) rallied 7,1% (-24,0%).

Goldman Sachs Commodity Index dropped -1,0% (26,8%). WTI Crude dropped -0,7% (13,1%).

Overnight in Asia,,,

  • S&P500 +7points; Nikkei +1.4%; CSI300 -1%; Hang Seng -4.1%

  • Following the week end confirmation that Japan had intervened on Friday in support of JPY, the Asian session started with renewed weakness before some suspected intervention materialized again, leaving USDJPY at 148.84 (from 147.70 as per Friday’s close). Volatility in JPY is set to continue as the government tries to offset the effects of BoJ ultra-loose monetary policy set to be reconfirmed this week.

  • China reported its Q3 GDP report that had been postponed without warning nor explanation last Monday as the Communist party held its 20th National Congress, showing that China GDP beat expectations, growing by +3.9% mom, a pick up from the 0.4% growth reported last quarter and bringing YTD growth to 3%.

  • The Hang Seng Index dropped to its lowest since 2008, following a leadership reshuffle over the week end which confirmed Xi’s firming grip over the ruling party which alarmed some investors. The addition of Covid Zero advocates to the Politburo Standing Committee was seen as diminishing the chance of any early loosening of Covid restrictions, Bloomberg reported. CNY dropped 0.5% overnight (to 7.2543).

  • After jumping 2.4% on Friday, the S&P500 started with strong gains overnight of as much as 1.3% which mostly petered out as Chinese shares slumped.

  • GBP rallied overnight after B. Johnson pulled out of the race to lead the UK conservative part, putting Rishi Sunak closer to becoming the next prime minister.

  • PMI’s are due out in Europe and the US today.

Have a nice week ahead and be good to yourself!

Marc Bentin, BentinPartner GmbH

Chief Investment Officer


To receive this report as soon as it is issued straight into your mailbox,

If you like our Weekly, you will love our Daily!

To learn more about us and how we can assist you, check our web site

Marc Bentin serves as Economic Advisor to Blue Lotus Management,

a specialist multi-manager investment firm, which seeks to provide investors a compelling alternative to the traditional 60/40 equity and bond portfolio by targeting higher returns without amplifying equity risks.

BentinPartner GmbH is Advisor to the Phi Funds AIF, an umbrella Alternative Investment Fund registered and regulated in Lichtenstein, specializing in the management of Funds focused on physical precious metals.


Important Disclaimer

© Copyright by BentinPartner LLC. This communication is provided for information purposes only and for the recipient's sole use. Please do not forward it without prior authorization. It is not intended as a recommendation, an offer, or solicitation for the purchase or sale of any security or underlying asset referenced herein or investment advice. Investors should seek financial advice regarding the suitability of any investment strategy based on their objectives, financial situation, investment horizon, and particular needs. This report does not include information tailored to any particular investor. It has been prepared without any regard to the specific investment objectives, financial situation, or particular needs of any person who receives this report. Accordingly, the opinions discussed in this report may not be suitable for all investors. You should not consider any of the content in this report as legal, tax, or financial advice. The data and analysis contained herein are provided "as is" and without warranty of any kind. BentinPartner LLC, its employees, or any third party shall not have any liability for any loss sustained by anyone who has relied on the information contained in any publication published by BentinPartner LLC. The content and views expressed in this report represent the opinions of Marc Bentin and should not be construed as a guarantee of performance with respect to any referenced sector. We remind you that past performance is not necessarily indicative of future results. Although BentinPartner LLC believes the information and content included in this report have been obtained from sources considered reliable, no representation or warranty, express or implied, is provided in relation to the accuracy, completeness, or reliability of such information. This Report is also not intended to be a complete statement or summary of the industries, markets, or developments referred to in the Report.

35 views0 comments

Recent Posts

See All


bottom of page