CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Disclaimer

Our systems have detected that you are using a computer with an IP address located in the USA. If you are currently not located in the USA, please click “Continue” in order to access our Website.

Local restrictions - provision of cross-border services

Swissquote Ltd is authorised and regulated in the UK by the Financial Conduct Authority (FCA). Swissquote Ltd is not authorised by any US authority (such as the CFTC or SEC) neither is it authorised to disseminate offering and solicitation materials for offshore sales of securities and investment services, to make financial promotion or conduct investment or banking activity in the USA whatsoever.

This website may however contain information about services and products that may be considered by US authorities as an invitation or inducement to engage in investment activity having an effect in the USA.

By clicking “Continue”, you confirm that you have read and understood this legal information and that you access the website on your own initiative and without any solicitation from Swissquote Ltd.

If cookies are currently disabled on your computer, you will be required to continue accepting this legal information for every new page visited on this website. In order to avoid this, please enable cookies on your computer.

Research Market strategy
by Swissquote Analysts
Daily Market Brief

Stocks & CHF Rally

1

Stocks & CHF Rally

By Peter Rosenstreich

We always felt Trump tariff on Mexican goods was a bluff. However, coming off unending negative headlines, the move was plausible enough. If the rumor is true in a closed-door meeting over the Republicans threatened to block Trump Mexico widen ranging tariffs. Stocks should continue to rally following the weak payroll report on the back of Trump decision to suspend tariffs. Asian stocks, led by China staged a relief rally on the positive Mexico trade news. US 10-year yields should stay above 2.06%, and could improve as the expectation for the Fed has become excessively dovish. Language from the Fed has indicated flexibility over wait-and-see. Elsewhere, Trump resumed his criticism of the Fed policy further, worrying investors over the independence of the world most important central banks. With global monetary policy normalization reversing, and macro-economic risk increasing, CHF remains in high demand.

Historically, CHF has outpaced G10 FX during Fed easing cycle and recession. Despite the SNBs negative interest rate policy and threats to penalize savers, further CHF is the king of economic safe-haven plays. Switzerland has the largest current account surplus as a percent of GDP in the majors. Last month the CHF has gained 2.5% against the USD with signals that the trend could accelerate sharply should the global economy deteriorate further. It is unclear how much appetite the SNB has for additional physical intervention, given the central bank's bloated balance sheet and questionable effectiveness. Given our skepticism for meaningfully interventions setting a SNB pain threshold becomes more difficult. That said, the SNB has a long history of punishing traders and most likely target psychological warfare before psychical interventions.

 
Live chat