Monday , 27 January 2025
Home Forex Morgan Stanley says stock rotation turned in deleveraging, eye US$45bn to sell
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Morgan Stanley says stock rotation turned in deleveraging, eye US$45bn to sell

Reuters with the report, citing a Morgan Stanley said in commentary to institutional clients on Thursday:

  • Computer-driven macro
    hedge fund strategies on Wednesday sold $20 billion in equities
  • set to shed at least more $25 billion over the next week
  • one of the largest risk-unwinding
    events in a decade
  • “The volatility of the last two weeks started out being very
    rotational,”
  • “But that has now morphed
    into a broad index deleveraging (on Wednesday).”
  • If volatility persists in the coming days, the sell-off
    would rapidly increase
  • An additional 1% day-drop in
    global equities could spark sales of $35 billion and macro hedge
    funds could dump up to $110 billion in a 3% day fall

Keep your eye on JPY, the carry trade deleveraging is a huge driver. 152 now the the level to watch:

This article was written by Eamonn Sheridan at www.forexlive.com.

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