magazine archive


magazine archive

Aequitas

Why US equities need a trade deal

Thursday 14 Nov 2019

The US stock market safely negotiated October this year, as the S&P 500 index gained 2% in the month and reached a fresh all-time high in early November. The Dow Jones Industrials and NASDAQ Composite have also surged to new peaks. Market accidents are usually caused by the combination of...

Will UK banks struggle like their Japanese counterparts?

Thursday 07 Nov 2019

The third quarter results from the FTSE 100’s ‘big five’ banks generally got a cool reception, not least because of fresh payment protection insurance (PPI) compensation claims and other assorted legal and conduct costs of £4.6bn. As a result, the FTSE All-Share Banks sector is down by 0.4% in 2019...

Why a sectoral shift raises big questions

Thursday 31 Oct 2019

The agricultural revolution introduced by 18th century British statesman Charles ‘Turnip’ Townshend may, at first glance, have no bearing at all on how investors could think about their portfolios and any tactical or strategic asset allocation decisions. Townshend argued that crop rotation was a...

Higher quality of earnings failing to support FTSE 100

Thursday 24 Oct 2019

Last week’s column looked at the quantity of FTSE 100 revenue, profit and dividends and drew comfort from how all three were expected to reach record levels in 2020, according to analysts’ consensus forecasts. Better still, those forecasts did not seem unduly aggressive, with the sales expected to...

FTSE 100 loses earnings momentum again

Thursday 17 Oct 2019

Brexit continues to dominate the headlines as the 31 October deadline for a withdrawal by the UK draws near and equity, bond and currency markets are becoming more volatile as a result. The dangers of second-guessing the outcome of the talks between Britain and the EU are clear from how the FTSE...

What is the repo market and why is it behaving oddly?

Thursday 10 Oct 2019

Real film buffs will remember Repo Man , a 1984 science fiction film directed by the UK’s Alex Cox but it is the repo rate that investors need to be watching closely right now. The repo rate is the level at which banks lend to each other overnight, or central banks lend to the banks. It provides...

Can Japan tackle global trade concerns?

Thursday 03 Oct 2019

Investors with exposure to Japanese equities are enjoying the ‘Abenomics’ area, which dates back to Prime Minster Shinzō Abe’s general election victory in December 2012. Since then, the Nikkei 225 index has soared by 125% in local currency terms and 126% in sterling, compared to a 30% gain in the...

Why are so many CEOs stepping down?

Thursday 26 Sep 2019

American football may not be everyone’s cup of tea but no less a figure than former Manchester United manager Alex Ferguson drew inspiration from a biography of the legendary Green Bay Packers coach Vince Lombardi. He shaped a small club in Wisconsin into the National Football League’s dominant...

Is the EU turning Japanese?

Thursday 19 Sep 2019

Outgoing European Central Bank (ECB) president Mario Draghi talked a big game over the summer that only served to ratchet up the expectations of financial markets greedy for more cheap cash. In the end, Draghi provided a 10 basis point (0.1%) cut in the deposit rate to -0.5%, charging banks more to...

Donald Trump is trying to reverse 48 years of economic history

Thursday 12 Sep 2019

When the latest meeting of the US Federal Open Markets Committee concludes on 18 September chair Jay Powell is widely expected to announce an interest rate cut, according to the CME Fedwatch tool. The only debate concerns whether it will be a quarter-point or half-point reduction from the current...

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