Summary

• Turkish bonds led a late week EM recovery on spec of policy action, the almost 200 bps decline in 10-year yield is a record for a week.  Thin volume contributed to the ramp
• Italian yields down on hope of prudent fiscal measures to come
• Indonesian yields up on expectations of central bank rate hikes at the end of the month
• U.S. credit remains well behaved
• South African rand slipped further on the week, though recovering a bit on Friday
• Russian ruble still feeling the pressure of sanctions
• Global stocks down on the week with few exceptions
• The Hang Seng, one of our original indicator species of global risk, down almost 5 percent on the week.  Aussie dollar, also a decent species, weak
• Commodities weak
• Fewer and fewer of Country ETFs showing decent gains on the year

Commentary:  Global markets are starting to feel the strain of the turmoil in emerging markets.  The U.S. employment report confirmed inflation on the rise and spooking bond markets. Tighter global money to come.

All eyes on U.S./China trade war this week. Expect more weakness next week unless a major break in tariff battle.   The S&P500 close slightly below the January high, which took almost seven months to recapture.  Monitor 2873ish  level closely as the breakout could have been a bull trap.  See chart below.