Related Articles
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The Stock Picker Has a Job (MORGAN STANLEY)
One of the themes that emerged from our recent Asia summit was the relative rise in interest in company meetings versus macro. The influence of the market (read: macro) on stock returns has been high over the past 18 months. with stockspecific idiosyncratic factors taking a back seat during this period. With the pace of returns likely to slow in the coming months, the key question is whether it is the right time…
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China’s Investment Boom: the Great Leap into the Unknown
In this report we describe the background to and the extent of the capital spending bubble in China and identify factors that will precipitate its deflation. We focus on Chinese capital spending firstly because it is the single most important driver of current Chinese and global growth expectations and, secondly and more importantly, investment-driven growth cycles tend to overshoot and end in a destructive way…
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The Asian-US Asset Allocation Debate (DEUTSCHE BANK)
A spirited debate within the asset allocation community has broken out over whether Asian stocks (and EM more generally) can continue outperforming the US into 2010. This is an understandable line of enquiry given Asian economies are no longer growing in isolation, and EM equity markets have enjoyed record inflows this year (in contrast to the US). We provide a synthesis…
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2010 GEMs Outlook: Headwinds Building But Further Upside Likely
We expect a more micro market in 2010. After two years where macro themes drove emerging equity markets, we expect a shift to a more micro market. Earnings and Valuations. Economies and earnings are recovering and it is likely too soon in the cycle for a major peak in EM equities. However, we do face the headwinds of a) monetary policy tightening…
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Monetarism of financial assets (ECONOMIC RESEARCH)
Episodes of moderate inflation, due to excessively expansionary monetary policies would lead to major strains on production capacity or the job market (1970s, early 1980s, late 1980s, India currently); • Episodes of hyperinflation (Germany in the 1920s for instance), due to a flight (because of mistrust) from money, as holders of money try to get rid of it by buying goods and services, leading to a very rapid rise in the prices of these goods and services.
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Gold rally may be snagged by fund option selling
The rally in gold may be reined in by options selling sometime in the next four to six months, if hedge funds and other institutional investors begin to view the rally as overstretched, some market observers said this week. Options in Comex gold and the over-the-counter market are predicting the precious metal has a 25% chance of being above $1,400 per troy ounce by the end of 2010, even though few…
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DIFFERENT TYPES OF DIVERGENCES
Divergence, which is a term that technicians use when two or more averages or indices fail to show confirming trends, is one of the mainstays of technical analysis. Here’s a new way to use oscillators and divergence as well as methods to locate entry levels during a trend. Most technical indicators mirror or confirm price movement. When price moves up, the indicator moves up…
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BALANCE OF PAYMENTS OUTLOOK (DBS)
The eruption of the global financial crisis in Sep08 led to withdrawal of foreign capital in Oct08-Feb09 and a 10% depreciation in the rupee against the dollar. But the crisis did little to alter the longer-term fundamentals of the economy and its attractiveness as an investment destination. Not surprisingly, and given hitherto cheap equity valuations, capital flows returned from March…
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Finding Value in a Crowded Market
China or India: Which Is the Better Long-term Investment for Private Equity Firms? The prospects for investment are strong in both China and India, according to Wharton faculty and industry experts. But the debate over which country is the better venue for investing is less important than knowing how the strengths and weaknesses of each nation would impact a specific investment.
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Commodities face conundrum as stimulus packages ease
Commodities trading activity is set to stay choppy until the markets’ conundrum–whether or not signs of recovery lead governments to cut stimulus packages too early–is resolved. This is leaving data, which has exceeded expectations in most instances, to rule the roost. But the problem is that the pendulum of positive sentiment generated from recent U.S. manufacturing and home…
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What a Great Exit Strategy!: MARC FABER
In last month’s report entitled “Why Are Most Investors Mostly Wrong Most of the Time?” I omitted to mention that Dalbar, a Boston research firm, conducted a few years ago a study on the performance of individual investors. According to Dalbar, from 1984 to 2000, when the S&P 500 was compounding at 16.3% per annum, the average US equity mutual fund investor achieved a return of only 5.23% per annum…
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Is the crisis over? (ECONOMIC RESEARCH)
As the economies are improving and the financial markets are rising, this question is often asked: is the crisis over? Our answer is clearly negative, with arguments depending on the horizons: In the near term (2010), we cannot see how OECD countries could avoid a significant slump in consumption – which will no longer be bolstered by any of the factors…
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Goldman Sachs : gold still relatively fair value
Gold and other commodities are justified at current pricing levels and aren’t exhibiting bubble-like characteristics when macro variables are taken into account, a senior analyst at Goldman Sachs (GS) told Dow Jones Newswires. “Interest rates on a nominal basis have been relatively flat while inflation expectations have been rising, putting downward pressure on real interest rates…
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STRENGTH, WEAKNESS, THREATS, OPPORTUNITY, ANALYSIS ON BANKING INDSUTRY
The rise of retail lending in emerging economies like India has been of recent origin. Asia Pacific’s vast population, combined with high savings rates, explosive economic growth, and underdeveloped retail banking services, provide the most significant growth opportunities for banks. Banks will have to serve the retail banking segment effectively in order to utilize the growth opportunity.
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BUY THE RUMOUR, SELL THE FACT by Michael Maiello
ALL OF THE UNCERTAINTY ABOUT THE FUTURE of social security and the shift from pension plans to stock market fueled 401(k) accounts has left Americans with the burden of knowing and playing the stock market, though many have little interest in the world of Wall Street. That forced entry into a confusing industry beset with institutional pitfalls and outright dishonesty leads to fear and to the desire for easy answers.
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I REALLY TRADE by Larry Williams
Trading Patterns for Stocks & Commodities It doesn’t matter if you are a longterm investor, short swing trader or day trader, you are always looking for an advantageous spot to enter your position. As someone who has been studying the markets since 1962, I assure you that not all market
