Investment Themes for 2017

At the start of the year fund managers, economists and other investment professionals as usual have put forward their views on the state of global economy and the direction of equity and bond markets. So what will be the key themes for investors in 2017? There is a wide consensus that this year could be a pivotal year for markets. …

Volatility & Interest Rate Sensitivity

A recent feature of global markets has been increased volatility in both equities and bonds. Clearly the Greek debt crisis has weighed on equity markets especially in Europe. Incidentally UK banks have very little exposure to Greek debt although the knock on effect of a default could be significant given the EU is our biggest trading partner and the potential …

Bond Sell Off, Investor Fears and Strategies

May has seen a sell-off in government bonds, in the UK, US and Germany. Yields had reached ultra-low figures and a correction was not unexpected. However investors are asking if this signifies the end of the bull market in bonds which has run for about 25 years. It commenced around 1990 when a secular long term trend of falling global …

Post General Election Surge & Market Outlook

Whatever your political persuasion UK stockmarkets have given a resounding thumbs up to the Conservative victory today. As I write the FTSE 100 index is up 2.08% p.a. whilst the more domestically focused FTSE 250 index has surged by 2.68% p.a. Favoured sectors include house builders, utility companies, banks, financials and outsourcers such as Capita. This has been a relief …

Super Taper Tantrum?

You may recall back in May 2013 there was a sharp sell-off in equities and fixed interest when Ben Bernanke, the chairman of the Federal Reserve, the US central bank announced that tapering of QE was ready to start. The market ignored the good news that the patient, the US economy could come off its money printing life support and …

Market Update & Commentary

After a volatile seven weeks on global markets equities have been rising steadily. The FTSE 100 hit a recent low of 6,029 on 24th June; yesterday it closed at 6,505. I sense the improving confidence has come from positive economic data, a focus on fundamentals and a realisation that a stampede to the exit by investors on news of tapering …

What’s Hot, What’s Not?

Apart from the weather, some investments are hot and some are cold. Of course I am referring to current buying and selling trends by investors. These trading decisions should be based primarily on economic and investment fundamentals but often sentiment and investor psychology is a key reason why investors trade. This is not always logical or proportionate. That said there …

Liquidity Squeeze in the Bond Market

Liquidity Squeeze in the Bond Market  The lead article in a recent edition of Investment Week, a trade paper I subscribe to highlighted significant liquidity issues in the bond market. Liquidity refers to the ability of traders, fund managers and investors to trade stock. It is crucial to ensure a properly functioning market whilst a liquidity crunch can cause difficulty in establishing prices which …