World economic activity has reached its nadir due to the Covid-19 pandemic. Both governments and central banks responded with unprecedented fiscal liquidity measures (the former) and increased expansionary monetary policy combined with near-zero interest rates and mass securities markets (the latter). Combined with the easing measures of commercial banks taken by supervisors, they provided ample …
Category: Market Analyses
Analyses and articles for world financial markets
What Possibility there is a Tapening in Fixed Income Markets to Stop The Recovery in The US
Data on the US economy last week showed that an annual growth rate (2021) is expected at 6.8% of GDP. At the same time, business profits for Q12021 are expected to increase by close to 36%. Continued price growth in stocks and commodities continues. This idyllically beautiful and optimistic image can be destroyed by the …
Inflation, Rising Interest Rates or Both Together?
At the hearing before Congress on Thursday, March 25, 2021, Fed Governor Jerome Powell was adamant that any resurgence of inflation in the US would be temporary (inflation above 2% for 2021), transitional and would in no way affect the Fed’s target of average inflation of 2%. But rising Federal Reserve bond yields point to …
Structure of The Stock Portfolio during the Economic Recovery Phase
Last week we saw a sell-off in the technology shares of large companies, a fall in the price of gold and a rise (fall) in yields (prices) on government bonds. However, the passage of the $1.9bn “Biden” fiscal package has made investors worried about the expected artificial inflationary pressures that will force central banks to …
Is it Time for the Eurozone/EU to Issue A Perpetual Bond?
Global debt has reached 365% of world annual GDP, an amount close to $280trillion and surely no one should expect this amount to be repaid within the space of a century. The only solution that seems feasible now is its unstoppable per-financing, although in the long term this solution is not sustainable, since it has …
Options Market
According to Options Clearing Corporation (OCC- www.theocc.com ) the world’s largest equity derivatives clearing organisation, achieved in 2020, clears record 7,52billion total contracts and 7,47billion options contracts. A total volume up 71% from a year ago and a rise more than 50% from 2019. What is an option contract An option is a contract between …
The Reasons of Why the Upward March in Stock Prices might continue in 2021
Many analysts consider some data that unfolded during 2020 and particularly at the end of 2020. With the announcement that vaccine production has begun and the mass vaccination of the world’s population against Covid-19 has begun, it gave the early signal that the pandemic is over. The governments of developed countries have already prepared in …
Will the Reform of a Company’s Listing Criteria Give Healthier Stock Markets to China?
U.S. President Donald Trump issued an executive order last November (2020) banning American investment firms from investing funds in Chinese companies located on the New York Stock Exchange (NYSE) and working with the People’s Liberation Army (PLA), forced on December 31, the NYSE to announce that it would remove (delist) the Chinese companies China Telecom, …
Why to Choose and Avoid as Investor equally to purchase shares through IPO’s
Initial Public Offering (IPO) is the procedure in which a company issues and releases its shares publicly for the first time. In addition, many companies to raise new capital choose to do so through the IPO process to either expand their business activities or their investments (possible and mergers & acquisitions) or to offer their …
The Gap Between How the Capital Markets Perceives Risk in Government Bonds Compared to the Verdict of The Credit Rating Houses
Markets always send the signal of risk or euphoria first, either by launching or shrinking bond spreads respectively and long before rating agencies start one by one and slowly downgrade the credit rating of the country which is under consideration. It is common for Big-Four Rating Companies – Fitch Ratings, Moody’s, Standard & Poor’s, DBRS …