Quote:Bring out the bubbly. It no longer looks like Europe’s going to enter a recession, according to Goldman Sachs economists. Economists led by Sven Jari Stehn still expect the eurozone economy to contract in the fourth quarter, but now anticipate a slight rise in the first quarter. For 2023 as a whole, the Goldman team expects the euro area economy to rise 0.6%, against a previous forecast of a 0.1% dip. There are three main reasons. One is that the industrial sector has been surprisingly resilient. Another is that natural gas prices have continued to fall sharply. And finally, China is reopening earlier than expected.Goldman Sachs economists no longer expect a recession in Europe
Quote:No matter how miserable 2022 was for investors of all sorts, they could have undone all manners of sin with one simple move — going long Chinese stocks in late October. The KraneShares CSI China Internet ETF KWEB, +0.12% has exactly doubled (okay, rose 99.88%) from its Oct. 24 intraday low. Of course, no one in their right mind would’ve made that investment allocation, so here in the real world, the question really is how far the rally can go. Mark Haefele, chief investment officer at UBS Global Wealth Management, says China’s unexpectedly rapid dismantling of COVID restrictions is paving the way for a faster-than-anticipated economic reopening. UBS has upgraded Chinese equities to “most preferred” in Asia, at the expense of South Korea, and says select companies in the consumer, internet, pharmaceutical, medical equipment, transportation, capital goods and materials sectors are likely to see more front-loaded returns. Onto the call of the day from Morgan Stanley, which in the same vein says it’s turned “even more bullish” on China. A team led by Laura Wang kept an overweight rating and raised their year-end target on the MSCI China index from 70 to 80. (The iShares MSCI China ETF MCHI, +0.36% ended Monday at $52.43.) It also lifted its China GDP growth estimate by three tenths, to 5.7%, which is ahead of the consensus 4.8%.Chinese stocks have been on a tear. Morgan Stanley says it's turning even more bullish on China.
Quote:European and British gas prices have fallen by almost 80pc since the panic buying in August. The benchmark TTF contract dropped below €70 per megawatt hour last week and is back to the levels just before the invasion of Ukraine. Futures prices have fallen pari passu for next winter as well, and for the winter after that. The market is no longer pricing in a protracted supply crisis caused by the cut-off in Russian gas. The world has adapted remarkably well to Vladimir Putin’s energy war.Time to end the catastrophism – Putin’s gas weapon has been spiked