{"id":51399,"date":"2016-04-26T00:15:27","date_gmt":"2016-04-25T22:15:27","guid":{"rendered":"http:\/\/beta.next-finance.net\/strategie\/jpy-at-risk-of-reversal-who-wins-who-loses\/"},"modified":"2019-12-31T00:40:27","modified_gmt":"2019-12-30T23:40:27","slug":"jpy-at-risk-of-reversal-who-wins-who-loses","status":"publish","type":"post","link":"http:\/\/beta.next-finance.net\/en\/strategie\/jpy-at-risk-of-reversal-who-wins-who-loses\/","title":{"rendered":"JPY at risk of reversal: who wins? who loses?"},"content":{"rendered":"

Risky assets kept on heading north. Chinese data are evidencing that the monetary and
\nfiscal stimuli are passing through in the real economy. The EPS season is starting better
\nthan feared. Moreover, the (dovish) Fed is keeping pressure on the dollar, while capping
\nany higher yields attempts. All of these were good ingredients for greater risk appetite, or
\nrather, for lesser risk aversion.<\/p>\n

Indeed, subdued trading volumes in most regions emphasized a continued reluctance to
\njoin in the rally, as has been the case since mid-February. Investors remain confused,
\nsorting out whether they gave in to unjustified fears in January, or whether they avoided a
\nvicious circle, courtesy of central banks, weaker USD, and recovering oil prices.<\/p>\n

Forced in the rally, investors remained on the cautious side, which could give ammunitions
\nfor further market inflows. However, unlocking them will likely require more fundamental
\nevidence, in particular regarding: the Fed\u2019s timeline that is central for many assets, the
\nsustainability of the pick-up in Chinese activity, the US consumers and EPS resilience, the
\ncredit impulse in Europe, and prospect for further BoJ easing.<\/p>\n

JPY and Japanese equities were the outcast of the rally, in diffidence of Abenomics\u2019 and
\nBoJ\u2019s chances of success. They bear a risk of a reversal ahead of the coming BoJ
\nmeetings (April 28 & June 16) and the July Upper House election.<\/p>\n

Hedge funds continued to progress last week. The longest bias strategies captured the
\nbulk of the gains: the long bias L\/S Equity and Special Situation funds outperformed. The
\nMerger Arbitrage funds continued to display limited contagion from the recent inversion
\nstress. Global Macro funds benefitted from their long equity exposures.<\/p>\n

CTAs recorded mild losses on bonds, partially offset by gains in equities. The violent short
\ncovering in financials and resources sectors unsettled the market neutral funds, as well as
\nsome variable funds.<\/p>\n

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