WHAT’S the right level for the stock market in an environment of high inflation, rising interest rates and slowing growth? That’s the question that’s been preying on investors’ minds for a few weeks now. Volatility has been high too, as investors have toyed with buying the dips but quickly lost their nerve and bailed out […]
Having kicked off the tightening cycle with a toe-in-the-water quarter point interest rate hike in March, the US central bank will get into its stride on Wednesday with an expected 0.5% rise to a 0.75-1.0% range. On both sides of the pond, stagflation is the fear but here it’s the ‘stag’ rather than the ‘flation’ […]
Having kicked off the tightening cycle with a toe-in-the-water quarter point interest rate hike in March, the US central bank will get into its stride on Wednesday with an expected 0.5% rise to a 0.75-1.0% range. On both sides of the pond, stagflation is the fear but here it’s the ‘stag’ rather than the ‘flation’ […]
And with that the probability of 3% US interest rates by the end of the year shot up to 75%. The CSI 300 index tumbled by 4.9% on Monday after speculation mounted that the capital, Beijing, was about to follow China’s commercial and financial hub, Shanghai, into a damaging and possibly extended lockdown. So, the […]
YOU might think that 2022 is turning out just how bitcoin investors would have liked. What’s more, bitcoin should, like gold, be resistant to inflation, owing to its limited supply. What we have seen, however, is a much more complicated picture forming. What squares the circle is the fact that bitcoin has become a bit […]
Shanghai remains in lockdown nearly a month after the country’s commercial and financial hub was closed in a bid to contain the worst Covid outbreak in two years. And it keeps up the pressure on the shares of companies whose profits lie a long way off into the future, such as technology growth companies. Meanwhile, […]
The bond market is flagging that risk, with short term rates as high or slightly higher than longer term yields. And if interest rates come back towards a neutral rate of around 2.5% within 18 months or so that might be a decent backdrop for shares. In the run up to the Easter weekend it’s […]
In the wake of more red-hot employment data last week in the US, investors are desperate for signs that the Fed is getting ready to crank up the pace of monetary tightening. Long yields are lower than short ones, which suggests that interest rates may be on their way up now but will soon be […]
The war in Ukraine, increased living costs and rising interest rates are just three reasons we might have expected UK shares to have done a lot worse so far in 2022. Well, the UK stock market certainly remains good value. And while investors are waiting for capital gains to come good, they are being rewarded […]
There’s no doubt the economic hit will be severe – Goldman Sachs thinks growth will fall from 4% to 2.5% – but investors are looking through a glass half full at more EU cohesion and higher defence spending in the years ahead. Former Pimco ‘bond king’ Bill Gross reckons the Fed will stop tightening when […]
INVESTORS, like everyone else, are attempting to understand the implications of Russia’s invasion of Ukraine. But restricting Russia’s access to the SWIFT payments system over the weekend hit sentiment hard on Monday. The yield on 10-year Treasury bonds, a key gauge of sentiment, started last week at just over 2% and ended it at 1.9%. […]
The S&P 500 finished last week on a downer, taking losses in the year so far to almost 10%, thanks to ongoing fears that Russia will invade its neighbour Ukraine in the coming days. Those geopolitical concerns mean that news on the pandemic has taken a back seat, but there are developments there, too. The […]
The main focus for financial markets is the likelihood of further economic sanctions on Russia, with a potentially significant impact on energy, food and metals prices. Having expected only a few months ago that there would be just one or two US rate hikes in 2022, the prospect of seven rather than the usual opening […]
RUNNING uphill, swimming against the tide – choose your metaphor for today’s investing environment. For the year ahead, momentum is waning slightly, but at 7% expected earnings growth, down from 9% at the start of the year, it still looks good enough as long as valuations stabilise, the Fed goes no faster than expected and […]
Emerging markets, which took a pasting last year, fell another 3%, with China 8% lower ahead of this week’s New Year break. Given that low interest rates and central bank bond buying is estimated to have pushed those valuation multiples higher than they should have been, you could argue that most of the unwind has […]
Previously high-flying tech stocks are in retreat, with a popular ETF that invests in innovative disruptors like Tesla down more than 40% since the start of 2021. The Federal Reserve is likely this week to give us a broad hint that its first rate-hike in this cycle will come as soon as its next meeting […]
How profits hold up will determine what kind of a year stock market investors enjoy in 2022. That will be enough to keep the bull market bubbling but only if valuations are not undermined by worries about inflation and rising interest rates. Fourth quarter GDP growth has just emerged at 4%, well down on the […]
How profits hold up will determine what kind of a year stock market investors enjoy in 2022. That will be enough to keep the bull market bubbling but only if valuations are not undermined by worries about inflation and rising interest rates. Fourth quarter GDP growth has just emerged at 4%, well down on the […]
THE Fed has provided the New Year fireworks this year. Expectations for an earlier turn in the interest rate cycle were given further support by non-farm payroll employment data which saw the unemployment rate dip below 4%, well on its way to matching the pre-pandemic low of 3.5%. That would be the fastest pace of […]
No-one should expect a repeat of 2021, which was a lot kinder to investors than anyone could have predicted 12 months ago. So, the current 7% rate of price growth in America, and not far behind that here in the UK and across Europe is the first cause for concern. The financial markets are sceptical […]