Shares can go up as well as down

European stock markets have rallied today. As I write the FTSE 100 is up 2.29%. Up to now it was the case that “shares can go down as well as down,” so today’s rise is a welcome respite. However it could prove to be a dead cat bounce, a temporary relief rally with no life in it. (No cats were …

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 …

Prospects for UK Inflation

The prospects for UK inflation has divided investors but I have held the view for several years now that inflation will surprise on the upside. Opponents point to the muted effect on inflation from QE and slow economic recovery from the worst global financial crisis and recession in living memory. Governments, companies and individuals have been paying off debt and …

A View From the Deckchair

Summer is here with clear blue skies and warm sunshine. Stock markets are traditionally quiet as traders take their August holidays. So what is the view from the deckchair? We still have deckchairs in Eastbourne but for city traders it will be the view from the pool at a luxury Greek villa. Surprise surprise there are small signs of economic …

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 …

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 …