Contrasting US Data – Bordier’s Monday Report

Durable goods orders came as a surprise in April, while household confidence disappointed.


The statistics published in the United States were somewhat mixed. Good surprises include durable goods orders in April (excluding transportation: +1.1% m/m), house prices in February (+2.4% m/m; +20.2% y/a) and the household expenditure in March (+1.1% m/m). By contrast, household confidence (from 107.6 to 107.3) was disappointing in April, as did the sale of new-build homes (-8.6% m/m) in March. The GDP contraction in the first quarter (-1.4% q/q yoy) is a surprise, but its composition is reassuring. In the eurozone, GDP has increased by 0.2% q/q, with core inflation accelerating to 3.5% y/y in March (overall inflation: +7.5% y/y). In China, repeated lockdowns dropped the PMI for services from 48.4 to 41.9 and manufacturing from 49.5 to 47.4.


The governor of Santiago de Chile indicated in mid-April that water rationing could be considered. The country has been struggling with chronic drought for 12 years, with a precipitation deficit of 71% in 2021 and the current Australian winter is the driest of the 21st century. This situation refers to that of North America, which, according to a study by Nature Climate Change in late February, has been experiencing a “mega-drought,” the worst episode in 1,200 years, for 20 years.


China’s zero-COVID policy and monetary policy uncertainties weighed on risky assets and interest rate volatility was very high. In the US, yields eventually settled and the 10-year yield stood at 2.93% (+4bp) on Friday from a low of 2.71%. In Europe, the 10-year Bund finished 3 bps lower at 0.94%, a recovery of 14 bps in the last two sessions. On the credit side, in a risk averse environment, spreads widened sharply in Europe (IG +8 bps / HY +42 bps) and in the US (IG +9 bps / HY +23 bps).

Trade sentiment

Sotck exchange

Stock indices are still struggling, with a special mention for technology, which has been hurt by inflation and the war in Ukraine. The FOMC meeting (+0.5% expected) and US employment statistics will be released this week, while at the micro level, quarterly results will follow their course (Logitech, BNP, DB, BP, etc.). We remain cautious, technical support is being tested.


The accumulation of bad news (fear of Chinese growth, war in Ukraine, risk of a European embargo on Russian oil) caused the € to plunge to its lowest level in 4 years at €/$ 1.0471. A breach of this support would open the way to €/$ 1,0340, otherwise a rebound to €/$ 1,0850 remains possible. The CHF remains stable at €/CHF 1.0260, sup .1.0088, res. 1.0480. The $ is rising to $/CHF 0.9724, sup. 0.9455, hers. 0.99. The oz of gold is $1883/oz, sup. 1821, hers. 2000.


Off-week risk in markets with US equities falling 3.3% and bond credit spreads widening. Sovereign tariffs are more stable, but offer no protection in the current environment. The dollar strengthening is significant (+1.7%) and is preventing the advance of gold (-1%). Oil is up 1.1% while copper is down 3.4%. Watching This Week: ISM Manufacturing and Services, Fed Meeting and US Jobs Report; EC confidence indices (economy, industry, services), unemployment rate and retail sales in the euro area; Services PMI (Caixin) in China.

Swiss market

Watch this week: April consumer confidence (Seco), April PMI indices, Q2 employment indicator (KOF), April inflation (OFS), April economic survey (KOF), unemployment in April (Seco) and foreign exchange reserves at the end of April (SNB). The following companies will publish figures/results: Logitech, Oerlikon, Aluflexpack, PSP Swiss Property, CFT, Geberit, Schaffner, Adecco, Landis+Gyr, Montana Aerospace, Swiss Re, Valiant and Datacolor.


AMAZON (Core Holding) released disappointing results and outlook due to rising inflation-related costs. Management announced a decrease in costs (no more intention to hire staff, brake on CapEx).

APPLE (Core Holding) reported a very good quarter, but expects greater supply problems and a slowdown in services in the coming quarters.

TELADOC (from the Satellite List): sharp downward revision of the 2022 targets and no repetition of the medium-term outlook. The environment is rapidly changing and becoming more uncertain, with the cost of acquiring new customers rising, the conversion of pipelines to revenue slower and signs of slowing down in new business. Management assesses the long-term impact of these changes. Given the uncertainties that cannot be resolved in the short term, we recommend selling the positions.

VESTAS (Core Holding) has been hit hardest by supply problems and other operational – logistical constraints and is warning this morning about 2022 results. Current levels represent a long-term buying zone in our view.

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