Technology is central to these stock markets

When Nasdaq sneezes, world stock markets catch a cold. What began as a world share market correction based on worries about rising interest rates, soon became a series of fears about how much more technology stocks can achieve after a stellar performance in recent years. Facebook got into trouble for its business model and has … Continue reading “Technology is central to these stock markets”

Millennials will reshape the investment landscape

Millennials are the largest generation that have ever existed. They are expected to make up 75% of the global workforce by 2025 and the way they spend their money will define the world over the course of the next few decades. With half of the world’s population currently under the age of 30, the values … Continue reading “Millennials will reshape the investment landscape”

Can China get along with President Trump?

When President Trump met President Xi we were told the meeting went well. The two men recognised the power each held, and both had a reason to want a positive relationship. Mr Trump understood the influence China has over North Korea, and wanted help with sorting out the tensions over North Korea’s development of nuclear … Continue reading “Can China get along with President Trump?”

Investors dump equity in favour of safe havens

Government bonds received a boost in demand last month as investors’ risk appetite was tested by volatility in equity markets. This risk-off attitude proved negative for corporate bonds, however. The looming threat of a trade war between the US and China sent shockwaves throughout equity markets last month, as investors braced for the impact of … Continue reading “Investors dump equity in favour of safe havens”

UK investors to get direct access to some Chinese shares

News that the British and Chinese stock market will be directly linked is a positive for both countries. It proves China is opening up and it is, post-Brexit, a vote of confidence in the City of London. By the end of this year, there will be a direct link between the London Stock Exchange and … Continue reading “UK investors to get direct access to some Chinese shares”

Bad news and good news for markets

Woes have come together in recent days for share markets. As if Mr Trump’s threats of a trade war were not enough, the President has now joined with others in criticising the business model and tax charges of some leading tech companies. After months of leadership by Nasdaq we saw the tech index falling as … Continue reading “Bad news and good news for markets”

Trade deficits and tariff wars

President Trump believes that if you are running a large deficit it should be easy to “win” a trade war. The problem with this argument is the EU and China may decide to engage. In 2016 the US ran a deficit of $505bn on trade in goods and services, according to the World Bank. Germany … Continue reading “Trade deficits and tariff wars”

Blue skies for communist China?

China is attempting to develop a more rounded and richer economy, with more coming from services and higher value added activities – a difficult balancing act. China’s achievement under President Xi, as under his immediate predecessors, has been impressive. According to the World Bank China now has the world’s largest economy as measured in Purchasing … Continue reading “Blue skies for communist China?”

The changing face of world shares

How the composition of the S&P 500 has changed and how crucial the technology giants are to the bull market? The US market represents more than one half of the total quoted wealth in world shares. It is, however, a very different pattern of wealth holdings from previous decades, reflecting the huge changes underway in … Continue reading “The changing face of world shares”

Time to revisit the Italian election

Markets have been relaxed about the Italian election.1 Last year it was on the investment radar as a potential risk to the euro and the Eurozone, with the Five Star movement leading in the polls and expressing scepticism about the single currency. As they did well so the new leadership of Five Star toned down … Continue reading “Time to revisit the Italian election”

The US Congress holds the purse strings and wishes to loosen them

In theory the President sets out a budget in February and the Congress responds with a Budget resolution in May. In practice the Congress runs the budget, and has just passed a two year budget deal regardless of the White House proposals that crossed in the post with their decisions. President Trump’s wish to cut … Continue reading “The US Congress holds the purse strings and wishes to loosen them”

The US budget should help economic growth

The Trump administration White House has set out its preferred budget for 2019. It is likely the House and Senate will wish to tone down its dramatic proposals. The President’s wish is to boost military and veterans expenditure substantially, whilst cutting back hard on various other departments and programmes. A 13% increase in defence is … Continue reading “The US budget should help economic growth”

What does a normal interest rate look like?

Markets have been worried that interest rates in the west are heading back to normal in a hurry. If rates go too high too soon they could damage the recovery and do more harm to shares. As the West agonises over the pace of putting up interest rates and winding down special monetary measures, the … Continue reading “What does a normal interest rate look like?”

After the melt up

In January we saw shares rising rapidly, in what some called a melt up. In the last few days they have come back down again very quickly. The year’s gains were rapidly erased. Should we worry? Last week before the fall I wrote that “There will be bad times from time to time. Worrying about … Continue reading “After the melt up”

Choosing assets for a portfolio

Asset allocation is central to creating a portfolio. The investor has to decide how much, if any, to have in shares, or bonds, or property. Those big picture decisions usually have the biggest impact on how much money you make or lose. At Charles Stanley we spend a lot of time and effort trying to … Continue reading “Choosing assets for a portfolio”