- December 14, 2018
- Posted by: Sunil Sharma
- Category: Global Investments
Global equities are subject to intensive volatility while hoping significant progress on US-China trade. In such an environment need for shifting assets within very short term becomes highly important. In addition to that, Fed is desperately trying to normalize financial markets by taking away the punch bowl (quantitative tightening). This has hammered many asset classes. This trend of high volatility is here to stay next year as well.
But seeing the glass half full and thru smart asset allocation, there are opportunities ( very short term) for healthy returns as well.
First of all, next week Fed is expected to be easy (dovish) going forward. Fed could trigger a healthy market rally for the sake of festivities as well.
Secondly, given the significant slow down in Chinese economy primarily via declining industrial production and consumer spending, a stimulus package in form of lower interest rates or easy bank regulation or government real estate investment is on the horizon. It will give a healthy boost to Chinese equities and commodities ( e.g. Copper).
Last but not least hope for global equity’s boost being the good intentions from US and Chinese trade officials to soothe the tensions, at least for the next couple of months.