Download PDF: Central banks in Czech and Hungary have begun to raise their policy rate this year amid acceleration in inflation as their domestic recovery unfolds, creating a tailwind for the koruna and forint against the Euro, which will not see the ECB raising its borrowing cost anytime soon (Chart 1). With Central and EasternContinue reading “Central and Eastern European Countries: Rising Rates Will Lift All Boats”
Tag Archives: equity
Where Is The Correction?
Download PDF: For over a year, investors have been rewarded for tilting their portfolio towards risk assets on the backdrop of plentiful support for households from the government’s generous fiscal transfer that supported spending and Fed’s support on the credit market, preventing a crunch in liquidity of the debt market. The unprecedented fiscal and monetaryContinue reading “Where Is The Correction?”
Yields Meltdown, Excess Savings and EM Policy Rate
Download PDF: Global stocks continue to experience a dichotomy in recent months amid unequal economic recovery in the developed and emerging world. With vaccination rate crossing above 50% of total population and covid-19 number goes into the rear-view mirror in the rich world, both manufacturing and service sector has rebounded strongly amid last year’s pent-upContinue reading “Yields Meltdown, Excess Savings and EM Policy Rate”
EM Strategy and Dissecting EM Stocks Performance
Download PDF: Potential peak in U.S. Treasury yield and copper/gold ratio, and gangbuster data coming from China, U.S., and Europe point to the passing of maximum growth momentum in post-pandemic recovery. Despite the pandemic still raging in parts of the world, especially in EM countries, strong recovery in China and the developed world mean ultra-easyContinue reading “EM Strategy and Dissecting EM Stocks Performance”
World Earnings and Valuation, Silver, EM Inflation
Download PDF: Developed World: Earnings and Valuation Outlook Earnings for most sector has recovered to pre-pandemic level, with health care and IT sector posting strong earnings in Q1. Growth expectations for both sectors, and materials, are strong and valuation is not demanding for the later. We believe that we are entering a structural bull marketContinue reading “World Earnings and Valuation, Silver, EM Inflation”
Peru: Latin America’s Growth Star
Download PDF: For long investors have regarded Chile and Peru as one of the more stable Latam countries, as reflected in these countries’ borrowing cost and disciplined management of fiscal and monetary policy. Late last year, however, Peru went through a political crisis over the impeachment of former President Vizcarra by the Congress over corruptionContinue reading “Peru: Latin America’s Growth Star”
On Brazil and Turkey
Download PDF: Stay Positive on Brazilian Assets The backdrop for Brazilian assets remains bullish amid rising commodity prices and undervalued Real (Chart 1). In addition, Brazilian economy has recovered strongly and various indicators – such as manufacturing PMI and retail sales – are now back to pre-pandemic level (Chart 2). With the global economy continueContinue reading “On Brazil and Turkey”
March 2021: Thoughts on Valuation, Oil, and Silver Demand
Download PDF: Part I. World’s Equity Valuation One year after the Covid-19-induced market crash, global equity market has gone through a V-shaped recovery with stock market in many countries breaking record high level amid ample monetary and fiscal stimulus. The U.S. market valuation – now trading at cyclically-adjusted P/E (CAPE) of 32 times – isContinue reading “March 2021: Thoughts on Valuation, Oil, and Silver Demand”
EM Taper Tantrum Déjà vu?
Download PDF: Potential for Sizable Portfolio Outflow is Limited. The period before 2013 Taper Tantrum was marked by strong capital flow into EM assets, in contrast to current situation where flow into EM bonds and equities are only beginning to recover (Chart 1). More importantly foreign ownership of EM bonds, especially for the more fragileContinue reading “EM Taper Tantrum Déjà vu?”
January 2021: Silver and Equity Strategy Review
Download PDF: Part I: Silver Last week seen silver prices dropped remarkably amid rising long-term bond yield and receding dollar weakness. We have been constructive on the precious metal and commodity complex for a while now and remain to be so in the reflationary environment. There are reasons to believe that the commodity bull marketContinue reading “January 2021: Silver and Equity Strategy Review”
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