Waning market stimuli put stock markets on notice

A pleasant Easter break has been followed by new highs for US equity indices. And yet, it has been a less comfortable week for professional investors. The tailwinds blowing the 2019 stock market bounce-back are waning. Rebounding bond yields have made corporate borrowing a little less cheap than it was in Q1; oil prices – climbing on supply fears rather than demand pull – are creating a strain for economic activity; and an unexpected step up in the value of the US$ is equally concerning for emerging market $ borrowers, as it is for $ denominated global trade volumes. And the major central banks of China and Europe have been indicating no great inclination to loosen monetary conditions further.