This investment clock says what assets to buy and when March 11, 2019 | City Talk By Tom Bailey from interactive investor. It’s inevitable that the unremitting global economic cycle will impact stock markets, but when? The economist Paul Samuelson once joked that the stock market has predicted nine of the past seven recessions. But while the over-reactive nature of equity market investors and their poor predictive powers ring true, there [...]
Futuristic entrepreneurs are helping us reach for the stars March 11, 2019 Houston, there is no problem. America is back in the space race. “We’re really at the forefront,” says US President Trump. “Nobody is doing what we’re doing.” He’s right. But in a break with tradition, the US is now leaning on its entrepreneurs, rather than the Federal Reserve, to fund its interplanetary aspirations. The latest [...]
US jobs growth flattens, but is the headline the whole story? March 8, 2019 | City Talk US hiring stalled in February, according to the latest non-farm payrolls report. The economy added just 20,000 jobs last month, down from a stellar 311,000 in January, and well below market expectations of 180,000. The market reaction has been swift; the Dow tumbled over 200 points, a 0.9 per cent loss, immediately after the release to [...]
Why investors should beware increasingly unforgiving debt markets February 20, 2019 | City Talk Last year may have been a tricky one for US markets and investors but it was less so for the country’s businesses – at least, that is, to judge by the headline numbers on US companies filing for bankruptcy. According to figures from BankruptcyData.com, 58 companies totalling $52bn (£40bn) of assets declared themselves bankrupt in [...]
The ECB has been keeping zombie banks alive February 18, 2019 A decade after the outbreak of the global financial crisis, banks in the euro area have still not recovered. The Eurozone financial stock index is 65 per cent below the pre-crisis peak, whereas the US S&P financial index has come close to the pre-crisis level. The varying fates of financial institutions is due to the [...]
What does the year of the pig hold for stocks? History has some clues February 8, 2019 | City Talk Chinese stock markets are currently on holiday, with traders and consumers off celebrating the arrival of the Year of the Pig. But maybe equity markets across the world have something to celebrate, given the past performance of stocks during previous porcine-themed years. Statistically speaking, the Year of the Pig is a good one for stocks. [...]
The yield curve explained: is it predicting recession? February 6, 2019 | City Talk The yield curve has been a reliable predictor of US recessions over the last four decades. Each time the yield curve has inverted, the US economy has entered a downturn within 18 months. At the start of 2019, the curve is precipitously close to inverting again. The yield curve is the difference between the interest [...]
Will 2019 be the year gold regains its shine? January 28, 2019 | City Talk Gold had a mixed year in 2018, quickly peaking around $1,366 in January, but falling as low as $1,160 by August. For a while it seemed that the correlation between risk-off appetite and gold prices had broken, with the yellow metal overlooked even in times of heightened uncertainty. But after a 7% recovery since early [...]
Number of funds generating top returns plunges in torrid investment environment January 22, 2019 The number of funds generating top returns plunged in the fourth quarter during a torrid investment environment. Only six of the 1108 funds analysed achieved consistent top quartile returns in the fourth quarter of last year, representing 0.54 per cent, down from 19 funds in the previous quarter, according to BMO Global Asset Management. Read [...]
US inflation falls for first time since March as petrol prices drop January 11, 2019 Cheaper prices at the pumps pushed down US inflation for the first time in nine months in December. Statistics released today show the country’s consumer price index (CPI) dropped 0.1 percentage points last month to 1.9 per cent, making December’s fall the first since March. However, when stripping out changes to the price of food [...]