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USDCAD TECHS

Needle Still Points South

US TSYS

Yields Bounce as Equities Make New Monthly Highs

AUDUSD TECHS

Heading North

EURJPY TECHS

Bull Rally Accelerates

COLOMBIA

Economists Survey Raises 2021 CPI Forecast To 4.9%

CHINA STOCKS
CHINA STOCKS: Morgan Stanley note that "a Chinese equity bull market is building
with rising volumes amid improved earnings visibility & liquidity, plus
regulatory/policy support. We raise targets for indices & still exp. A-shares to
outperform. Our new June 2021 targets: CSI 300 - 5,360 (+15% upside), MSCI China
- 103 (+8%). Our earnings growth forecasts for '20 & '21 rise marginally.
- Global EM investors' underweight position in Chinese equities has narrowed
(now 100bp underweight). We see that continuing because of China's relative
macro performance & the sectoral skew in MSCI China (and increasingly, A-shares)
to the New Economy (Consumer, Tech, Communications Services, and Healthcare).
- A-shares are benefiting from strong new fund launches and rising retail
investor account openings in the context of regulatory support and an ongoing
market reform push. The expected marginal weakening trajectory of USD/CNY also
supports a preference for A-shares to cushion negative translational effect.
- Our proprietary A-share sentiment indicator showed its largest 1-week rise
ever last week & its 3rd-largest daily increase on Jul 6. However, its 65%
reading is still below levels associated with unsustainable investor euphoria."
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com