THE MARKET VOLATILITY IS INCREASING AS THE FEDERAL RESERVE AND ECB GOES INTO ACTION

Fed Policy Shift Raises Heat on the ECB 

The European Central Bank is probably a step closer to aiming for periods of inflation above its goal now that the U.S. Federal Reserve has adopted that strategy, according to economists and its former vice president.

The Fed’s new approach, unveiled by Chair Jerome Powell on Thursday, is to seek inflation that averages 2% over time. That would allow it to tolerate a faster pace after periods of weakness, avoiding early interest-rate hikes when price growth moves close to its target. READ MORE

Abenomics Era Ends With Japan’s Economy Back at Square One – WHAT A TIMING?

The almost 8-year era of Abenomics draws to a close with Japan’s economy right back at square one.

Prices are flat lining and the deflationary mindset seems as entrenched as ever. Many of the women who entered the labor market under Prime Minister Shinzo Abe’s tenure are losing jobs as Covid-19 batters the economy. Households and companies are in saving mode again amid the pandemic, forcing the government to borrow heavily to cushion demand.

It wasn’t meant to end this way. Abe, who announced on Friday afternoon in Tokyo he would step down due to health problems once his ruling party decides on a successor, came to office with grand plans to snap Japan out of its two decades of stagnation. What would become known as Abenomics relied on “three arrows”: monetary easing, fiscal policy and regulatory reforms. THE MARKET GETS EEN TOUGHER – READ MORE

WHAT ARE THE CHARTS SAYING?

KEY TAKEAWAYS

  • If you are trading the currencies – be cautious with JPY & EURO as they are now becoming safe haven in the currency world
  • If you are trading Gold – You can focus on all Pullbacks Buy
  • If you are focusing on Oil – be cautious over OPEC Meetings & Demand/Supply effect
  • If you are trading stock – do remember the US Market is over-valued and that you are buying at the Peak

PHILIPPINES STOCK MARKET

KEY TAKEAWAYS

  • Earning across the board is weak and we can see that in the Volume
  • Many traders are on the side-line and foreign buyers are getting lesser
  • We see more and more cautious trading ahead as the US Market recovery is at the peak and over-valued – any fall in the US Market the ripples will damage the PSEI also
  • Buy companies that are potential growth ahead – companies that you are able to see good future earnings – i.e. ACEN, NIKL, MPI, MWC, DITO and many others
  • Choose the companies and keep your portfolio diversified at all times.
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