Markets Are at Risk of a “Melt-Up” [Video]

This Bull Market is About to Go Out With Bang

The rally in global equities may have some more steam into it, as more money jumps back into the market, according to BlackRock CEO Larry Fink: “We have a risk of a melt-up, not a meltdown here. Despite where the markets are in equities, we have not seen money being put to work”. A melt-up is a big move in the markets that comes from investors trying to get in on a momentum shift but it is also seen as a sign of a late-stage bull market.

 

Stock Markets Continue to Rally

Global stock markets continue to rally, and the Nasdaq is back at ATH levels, despite mixed Netflix earnings and another set of weak IBM earnings. China bounced back with good economic data, especially when it comes to industrial production, which surpassed expectations strongly. The positive China eased concerns about a global economic slowdown and pushed global stock markets higher.

 

Wirecard Fights Back

The German bank Wirecard could see some buy interest now that the German regulator is suing the Financial Times over market manipulation because of their articles that heavily pressured Wirecard shares down earlier this year.

 

Forex Preview

The New Zealand dollar slid to a three-month low on Wednesday as weaker-than-expected consumer inflation figures for the first quarter increased odds of an interest rate cut by the RBNZ. Meanwhile, the Aussie hit two-month peak after steady China growth data. The strong China data had the exact opposite effect on the safe-haven U.S. dollar which sagged against the euro as global economic slowdown concerns eased.

Elsewhere, the sterling remain subdued despite a weaker dollar amid a deluge of Brexit headlines that put PM May back in the spotlight for a possible no-confidence vote. The EUR/USD recovered some of its previous losses as the dollar weakened and despite statements of ECB officials expressing doubts of a Q2 bounce back of the economy.

 

Oil Higher, Gold Subdued

Oil prices rose for a second day on Wednesday after oil inventories in the United States fell unexpectedly. Meanwhile spot gold paired some of its losses on Wednesday to last trade at 1279.3 per ounce as of 8:05 GMT, after having fallen as much as 1.2 percent to $1,272.70, its lowest since Dec. 27, in the previous session. Gold prices still remain below the key $1,280 level and are near a four-month trough, as better-than-expected economic readings from China turned market risk sentiment on and dented the noble metal’s safe-haven appeal.

 

Bitcoin Pushes Higher

BTC/USD is trading well above the 5K level, at 5249.4 as of 8:05 GMT this morning, after having noted a major rally late Tuesday. BTC/USD may be re-testing yearly highs today as bitcoin sees new record trading volumes.