sentix Survey Essentials (English)

Commodities and Euro in the sentiment spotlight

The latest sentix survey throws up a couple of notable developments. A month ago we noted that there was a risk that continued caution on commodities would prove a drag on emerging market (EM) equity sentiment. In the event, investor sentiment towards EM has begun to follow survey readings on commodities lower in the latest survey, though it is also notable that investors are becoming less negative on Crude oil from a medium-term strategic perspective. Any signs of a wider firming in sentiment towards commodities would likely lend support to EM equity sentiment. In FX, optimism on EUR/USD has reached its highest level for over a year, with readings based on the near-term outlook for the euro versus the US dollar now running at the high-end of their historic range. A lot of positive near-term sentiment is baked into EUR/USD at current levels. See Charts 2-4, p2.