Dr. Alan O'Sullivan

If you look at the S&P 500, up 4% year to date.

And that is really kind of telling about, number one, the market is looking through geopolitics, as it always has.

And number two, there's definitely an economic disconnect.

There's an economic disconnect somewhere.

Is it AI?

Is it the economy, some structural issue with the economy that is making it less connected to markets?

I'm not sure.

But there's some rich pricing data, obviously, in this macro pulse that will be sent to you.

Looking then at bond yields, we can also see we've got global bond markets.

And again, as we would expect on Friday, we saw yields fall, bond yields fall, and we saw oil fall.

Obviously, we'll look at commodities in a second.

So previous, during the turmoil, we had bond yields repricing because...

They're priced off interest rate expectations, inflation expectations.

And if there's going to be a commodity shock, if oil prices are going to rally higher, you're going to see a reluctance on central banks to cut interest rates.

And the bond market is going to reprice on that.

That's why we saw yields higher.

Interesting to look at, if I zoom in a bit, the European experience of bond yields, looking at the difference between what you might call the more stable, more secure European bond market, the likes of the northern European countries, there is a premium being priced in.

to European sovereign bonds at the moment, as you would expect.

You've got the northern European countries, Austria, Belgium, Denmark, maybe hovering around three high twos.

And then you've got France, obviously huge debt problems, total debt very large.