Tag Archives: investing in equities

The end of the debt bias is nigh

Corporate bondholders, beware. The wave of enthusiasm for this asset class, which has helped it to reach new heights, is now ebbing. A research paper recently published by the IMF illustrates the reasons behind this – although it must be said the paper does not represent the official position of the IMF.

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As ‘exodus from Europe’ intensifies, watch the UK savings ratio

The list of reasons to worry in the market is growing longer by the day, and investors keep taking money out of risky assets – among them, European ones.

The phenomenon has been dubbed an “exodus from Europe” by analysts at Bank of America Merrill Lynch, who say there is “no surprise that the outflow from European high grade and high yield funds has been much more sizable than outflows from emerging markets debt funds.”

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Will Green November follow Red October?

Last month has become known as Red October, not so much as a hint to the film starring Sean Connery as the commander of the defecting Soviet submarine by that name, but sadly, as an accurate description of the dominant colour on trading screens around the world.

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Don’t do all your stock market shopping on Halloween

The Halloween effect is a well-known seasonal quirk that pushes stock prices up between October 31 and May 1. After a horrible October for stocks, investors are anxious to know whether the market rout is over or it has more to run.

There is one indicator that could provide some clues. We’ve spoken about it before on this website. Bank of America Merrill Lynch’s Bull and Bear indicator triggered a “Sell” signal back in January of this year, and it is now close to a “Buy” one – although not yet.

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As market bubbles keep inflating, signal gets close to ‘sell’

Investors’ optimism remained at very high levels, despite the beginning of tapering of quantitative easing by the European Central Bank (ECB), tensions with North Korea and the Catalan crisis.

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Euphoria grips the markets, but can it last?

Last week was a feast of records for Wall Street: the S&P 500 recorded six consecutive highs, something not seen for two decades. The streak only ended after a jobs report that showed the first negative reading in seven years, skewed by the hurricanes that hit the U.S. in September.

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The first half of the year was full of humbling lessons

What a spectacular lesson the first half of the year delivered for investors. At the beginning of the year, it looked like the UK’s vote to leave the European Union was a great idea: the eurozone seemed on the brink of disintegration.

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European stocks are everybody’s darlings

The European Central Bank (ECB) will find itself the only game in town soon. It is the only major central bank still buying bonds hand over first, and therefore it is dictating the pace for private investors.

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The Fed is behind the curve, and happy to stay there

There is a widespread view that the Federal Reserve will have to raise interest rates at a steady pace this year, because it cannot afford to fall behind the curve.

I would argue that it has already fallen behind the curve and has no choice but to remain there. And it is not the only one in this situation. All major central banks are playing the same game; they have no choice.

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Air keeps coming out of the bond bubble

The air came out of the bond bubble last month, when bond funds recorded the highest five-week outflows in three years and a half, according to capital flows data analysed by Bank of America Merrill Lynch economists.

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