BOB PISANI, NIGHTLY BUSINESS REPORT CORRESPONDENT: The markets are facing a trifecta of issues, higher earnings that could already be priced into
the market slower global growth and finally higher rates.
Not exact matches
Stocks are facing a trifecta of potent issues: the argument that higher earnings are factored into the
market («peak earnings»), that
global growth, while still strong, is
slowing, and that inflation is picking up.
In a note to clients late last week, Goldman's
global markets analyst Caesar Maasry characterized
global growth as «strong but
slowing.»
However,
growth in the classic car
market is
slowing, in part due to fears of a potential interest rate hike by the U.S. Federal Reserve and a downturn in
global liquidity.
Coupled with other bumps on the road (think the eurozone crisis and
slow global growth) the overall effect, he added, «has been economic
growth around 2 percent, and only a very gradual improvement in labor
markets.»
Global growth has
slowed more than investors had previously anticipated and political risk has risen; yet over the past four years flows into emerging
markets funds have remained very strong despite their underperformance.
There are other headwinds affecting the
global markets: somewhat
slower growth in China, declining commodity
markets, the uncertainties surrounding the coming end of QE2, and more restrictive fiscal policies in many countries.
China's economy, long a reliable source of
growth, is
slowing, a situation that has created uncertainty in the
global markets.
Despite
slowing global growth, there are attractive potential opportunities outside the U.S.. For example, Japanese stocks continue to offer relative attractive valuations, especially in comparison to other developed
markets.
The underlying determinants for these declines are related to the
global supply and demand for funds, including shifting demographics,
slower trend productivity and economic
growth, emerging
markets seeking large reserves of safe assets, and a more general
global savings glut (Council of Economic Advisers 2015, International Monetary Fund 2014, Rachel and Smith 2015, Caballero, Farhi, and Gourinchas 2016).
Fears that the country's economy is
slowing have weighed heavily on
global markets in recent months because a weak China can drag down
growth globally.
As I observed in February (see
Market Action Suggests Abrupt
Slowing in
Global Economic
Growth):
«There's a willingness to pay for
growth in a
slow -
growth economy,» said Liz Myers, JPMorgan Chase's head of
global equity capital
markets.
Financial
markets are experiencing heightened volatility these days, driven by concerns about
slowing and uneven
global economic
growth.
These questions come as EM stocks have had a rollercoaster year, with valuations beaten up by concerns about China's economy,
slowing global growth and lower commodity prices, just to name a few of the headwinds facing developing
markets.
While the decision to leave the EU has caused notable
market upheaval,
global market declines were actually more extreme in the first few months of 2016 due to significant commodity price weakness, concerns regarding
slowed economic
growth in the U.S. and China, and monetary decisions by major central banks.
However, further regional policy divergence,
slow emerging
markets growth and
global liquidity risks are likely to keep
market volatility higher, meaning effectively navigating a low - return world will remain a challenge.
Market volatility, in the face of worries over
slower global economic
growth, has led investors to become more critical of new offerings.
The organization cited
slower growth in emerging
markets, especially in China, falling commodity prices, and rising interest rates in the U.S. as potential risks to
global growth.
Demand has suffered as
global growth has
slowed, particularly from commodity - intensive emerging
markets.
What's more, the PMO's own statement then ran through a full litany of all the bad things that lie ahead: decline in
global stock
markets, decline in commodity prices,
slowing growth in China and emerging
markets, and potential impacts on Canada's economy. Instead of boasting about Canada's successes under Conservative leadership, the PMO went to great lengths to show how bad things could get.
The issues at play here, such as some easing in concerns regarding the crisis in the eurozone and the prospects of
slowing growth in emerging
markets, look to be much more
global in nature, relative to the natural - gas
market.
Lost in all of this doom and gloom is the reality that while emerging
market growth has
slowed, the longer term thesis of more individuals joining the
global middle class remains intact.
And while U.S. economic
growth today is lower than at points in the 1980s and 1990s, it's still quite remarkable in a
global environment beset by only moderate European
growth and
slowing growth in China and other emerging
markets.
The uncertainties associated with the U.S. election, BreXit,
slowing growth in China and in the emerging economies, uncertainty and volatility in international financial
markets, all suggest that the downside risks to the
global economy are still high.
The central bank also downplayed recent
global financial
market turmoil and said the U.S. labor
market was still healing despite a
slower pace of job
growth.
The recent downturn in the
global equity
market has been attributed to a litany of different things, including
slowing growth in the United States, China, Europe and Japan, geopolitical issues in Russia and Ukraine, ISIS in the Middle East and even Ebola cases in the United States.
The
slowing growth in the smartphone
market means
global smartphone AP shipments will only grow at a mild pace in the next few years, reaching 1.77 billion units in 2021.
Slowing economic
growth in New Zealand's top export
market, China, and a
global oversupply of milk products have seen dairy prices plummet after reaching record highs in 2013.
The
global dairy
market appears to be headed into another period of milk «supply scarcity» in the next 12 months as production
growth begins to
slow in the world's major export regions, Rabobank has claimed.
As supply increases from producers in the Southern hemisphere and demand
growth slows the currently high
global dairy prices are expected to ease somewhat, according to
market analysts.
The international rollout is taking longer than anticipated, with Nook still focused in the US, UK, and now Australia (some additional
global markets can access the Nook ebook store through specific tablet apps, however), but at a time when there's a high rate of turnover within the digital division, maintaining a
slow but steady pace of international
growth may be the smarter move to take.
Despite
slowing global growth, there are attractive potential opportunities outside the U.S.. For example, Japanese stocks continue to offer relative attractive valuations, especially in comparison to other developed
markets.
These questions come as EM stocks have had a rollercoaster year, with valuations beaten up by concerns about China's economy,
slowing global growth and lower commodity prices, just to name a few of the headwinds facing developing
markets.
The stock
market is plummeting today because of concerns about the
global economy, including the European debt crisis and the
slowing growth rate in China.
Information received since the Federal Open
Market Committee met in December suggests that the economy has been expanding moderately, notwithstanding some
slowing in
global growth.
Demand has suffered as
global growth has
slowed, particularly from commodity - intensive emerging
markets.
Reading the Australian Financial Review on an interstate flight yesterday, I accepted the assertion that the
slowing of economic
growth in China was a large contributor to the recent volatility to
global share
markets.
So, if the
market sentiment decides it doesn't like a few factors, such as a decision to follow a divergent monetary policy, continued
slow global economic
growth, a world - wide aging population, and the swearing in of Donald Trump as the next American President, we could be see a rise in bond rates, which will absolutely start to increase fixed - rate mortgage rates.
Gyrating stock values, slumping oil prices, turmoil in foreign currency
markets, predictions of
slow growth or even deflation abroad... Suddenly, the outlook for the
global economy and financial
markets looks far different — and much dicier — than just a few months ago.
'' [Meanwhile] the
global market for video games industry continued to experience healthy
growth despite a
slowing world economy.»
The
slowing growth in the smartphone
market means
global smartphone AP shipments will only grow at a mild pace in the next few years, reaching 1.77 billion units in 2021.
IEA releases Oil
Market Report for August
Global oil demand
growth expected to
slow through 2016 11 August 2016
November Oil
Market Report forecasts
slower growth in 4th - quarter
global demand Supply increased in October, IEA short - term outlook finds 13 November 2012
In its latest Medium - Term Coal
Market Report the International Energy Agency (IEA) forecasts a
slowing of coal demand
growth but no retreat in its
global use.
Increasing
global economic integration makes the opportunities in international real estate investment more compelling than ever before — especially given weakness and
slow growth in the domestic real estate
markets of most developed economies.
With price
growth slowing, and even turning negative, in some major housing
markets such as UK and the US due to the recent
global financial and economic crisis, it is important for property investors aiming at maximizing returns and minimizing risk, to understand the dangers of purchasing a property in order to rent it.