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Finding a sweet spot in the FTSE market mayhem

October 17th, 2014

By Mike Franklin, Chief Investment Strategist Since mid-May 2014, the FTSE 100 Index has fallen by around 10% to the 6,100 level. It is a sobering reminder of the enduring truth of the financial world that, whatever you think it may be worth, the value of an asset at a particular point in time is […]

UK house price perception improves in October

October 17th, 2014

As per a survey by Knight Frank and Markit Economic, the UK house price sentiment index rose to 60.7 in October from 60.6 in September, ending the view of price moderation. Moreover, the future house price sentiment index climbed to 70.8 from 69.2 in September.

China’s aggregate financing rises in September

October 16th, 2014

The People’s Bank of China (PBoC) stated that the new credit financing for September rose to a three-month high of ¥1.05tn, indicating the success of its monetary policies. Moreover, towards the end of September, the M2 money supply grew 12.9% y-o-y, while foreign reserves stood at US$3.89tn, down 2.6% from the previous quarter.

Germany trims 2014 growth forecast

October 15th, 2014

Germany cut its 2014 growth forecast to 1.2% from 1.8%, as estimated previously, due to the adverse impact of the weakening Eurozone. The government also reduced its projection for 2015 to 1.3% from 2% earlier.

Warm weather impacts UK retail sales in September

October 14th, 2014

The British Retail Consortium reported like-for-like (LFL) retail sales decline of 2.1% y-o-y in September, after rising a strong 1.3% y-o-y in August. Total sales dropped 0.8% y-o-y, the biggest fall in years, due to unusually warm weather. Sales had increased 2.7% y-o-y in the previous month.

China trade data beats expectations in September

October 13th, 2014

Exports grew 15.3% y-o-y from 9.4% in August, while the imports gained 7.0% against a drop of 2.4% last month, both beating market expectations. However, the trade surplus for the month stood at US$31.0bn.

The ‘widening triangle’ revisited and a peaking Wall Street

October 10th, 2014

The widening triangle analysis has served us well in the past few months and helped to identify the 14th May as a possible recent market peak and guided us to use the last rally to raise liquidity. The charts of the FTSE 100 Index below show that we are now just below the bottom of the triangle on a closing price basis so today’s closing level may be very important. This coincides with the market having become oversold.

Bank lending in Japan increases in September

October 10th, 2014

The Bank of Japan (BoJ) informed today that the bank lending in Japan rose 2.3% y-o-y to ¥479.0tn in September vis-à-vis 2.2% in August. At the end of its meeting, the BoJ maintained its monetary policy and said softening measures were fruitful.

House prices in London decline in September

October 9th, 2014

The Royal Institution of Chartered Surveyors (RICS) reported house prices in London dropped for the first time since January 2011, marking a slowdown in the UK housing market. The RICS price balance slipped to 30.0 in September from a downwardly revised 39.0 in August.

IMF downgrades global growth forecast for 2015

October 8th, 2014

The International Monetary Fund reduced its global growth projection for the next year to 3.8% from 4% estimated in July. Recovery in the US economy has been largely offset by persistent weakness in the Eurozone and major slowdown in numerous emerging markets.

This time is different…(?)

October 7th, 2014

Now that the long term (bull market) trend line since March 2009 has been broken, it may be appropriate to circulate the chart below showing how the 2007 to 2009 bear market emerged for anyone who has forgotten.

BOJ retains monetary policy

October 7th, 2014

The Bank of Japan (BOJ) upheld its record stimulus at the conclusion of its meeting today. The monetary base would be increased to ¥70tn from ¥60tn annually. A six-year low yen deferred further monetary easing. The BOJ projects consumer prices to increase in the middle term.

UK home prices may fall in 2015

October 6th, 2014

As per the Centre for Economics and Business Research, home prices in the UK would decrease 0.8% y-o-y in 2015, partly reversing the 7.8% y-o-y gain in 2014.

Japan services PMI expands in September

October 3rd, 2014

Today, the latest survey by Markit Economics in Japan reported a services PMI reading of 52.5 for September. The reading significantly exceeded 49.9 in the previous month.

Japanese firms maintain inflation forecast

October 2nd, 2014

A survey by the Bank of Japan (BoJ) revealed Japanese companies retained their inflation forecast of 1.5% for the coming year. These companies’ three- and five-year estimates are unchanged at 1.6% and 1.7%, respectively. Inflation forecasts were lower than the BoJ’s inflation target of 2%.

Italy downgrades growth forecasts

October 1st, 2014

The Italian Finance Minister Pier Carlo Padoan stated the country’s GDP is likely to contract 0.3% this year, instead of growing 0.8%, as previously predicted. Estimated expansion for 2015 was also cut to 0.6% from the initial forecast of 1.3%.

UK consumer confidence slips in September: Gfk

September 30th, 2014

Gfk’s survey revealed the consumer confidence index fell to -1 in September, retreating from +1 in August. The sentiment weakened as better economic data did not translate into an improved standard of living or wage hike.

Geneva’s annual report indicates probable crisis

September 29th, 2014

As per Financial Times, the report by International Centre for Monetary and Banking Studies, expected to release soon, cautions against another crisis owing to high debt and persistently slowing growth in various economies. The report records the escalating public sector debt in developed countries and private debt in emerging markets.

Growth in Japan’s core CPI misses expectations

September 26th, 2014

The Ministry of Internal Affairs and Communications of Japan reported core consumer price inflation (CPI) increased 3.1% y-o-y in August vis-à-vis 3.3% in July and the expectation of 3.2%. Overall inflation was up 0.2% m-o-m and 3.3% y-o-y.

Three Fed presidents insist tolerance on interest rates

September 25th, 2014

Eyeing low inflation and slower growth, Fed presidents from New York, Minneapolis and Chicago warned against premature tightening of the monetary policy. The support came just a day after the Fed chair Janet Yellen’s comments of a sooner-than-expected rate hike.

UK mortgage approvals decline unexpectedly in August

September 24th, 2014

UK mortgage approvals fell to 41,588 in August from 42,715 in July, British Bankers’ Association said yesterday. However, gross mortgage borrowing rose to £11.1bn from £10.9bn last month.

Chinese manufacturing PMI beats expectations

September 23rd, 2014

Markit’s preliminary PMI reading signalled a rebound in China’s manufacturing sector. The PMI came in at 50.5 in September, well above 50.2 in August and the expectation of 50.0. New domestic and export orders, work backlogs and purchase quantity increased at a faster pace.

GDP leaders vow co-operation for global growth

September 22nd, 2014

The G20 finance officials met in Australia to pledge for robust growth in the world economy. The officials said the combined economic output of member countries should rise at least 2% above the current estimated reading for 2018, driven by structural measures and infrastructure spending.

Scotland votes ‘No’ to independence from UK

September 19th, 2014

Scotland will remain part of the UK after voters reject independence and First Minister Alex Salmond admits defeat.

Fed to maintain low rates for ‘considerable time’

September 18th, 2014

Yesterday, the Federal Reserve said rates are likely to remain unchanged for a ‘considerable time’ after the conclusion of the bond buying programme as it ponders cautiously over the jobs situation and inflation data. The central bank’s monthly asset purchases have been reduced to US$15bn, with the stimulus programme expected to end in October.

PBoC official reveals US$81.0bn stimulus

September 17th, 2014

People’s Bank of China (PBoC) is expected to grant a US$81bn or ¥500bn incentive to the country’s five biggest banks in an attempt to revive the economy. The People’s Bank of China plans to inject ¥100bn in each of the five banks for a three-month period. This news is not confirmed by the PBoC yet.

Barry Gibb on TipTV.co.uk, 16th September 2014

September 16th, 2014

Beaufort research analyst, Barry Gibb speaking about Smith & Nephew (SN..L), Kingfisher (KGF.L), Fox Marble Holdings (FOX.L) and Advanced Oncotherapy (AVO.L) on TipTV.co.uk (Source: www.tiptv.co.uk) – 16/09/2014

Scotland and the Independence Referendum

September 16th, 2014

If there is a ‘Yes’ Vote on Thursday there are a number of worries about British Companies domiciled in Scotland and a number of these Companies have commented about moving their HQs to England. Indeed, a high profile former deputy leader of the Scottish National Party has indicated that banks face a ‘day of reckoning’, adding that the oil major BP (BP..L) would need ‘to learn the meaning of nationalisation in part or in whole’, after a Yes vote. The Yes Campaign has allegedly distanced themselves from his comments.

China’s FDI hits four-year low

September 16th, 2014

Today, the Chinese Ministry of Commerce reported inbound investment in the country declined 14% y-o-y to US$7.2bn in August, after plunging 17% in July. With this, China’s inbound FDI during the first eight months of 2014 is down 1.8% y-o-y to US$78.3bn.

UK house prices rise 0.9% in September

September 15th, 2014

Today, data from Rightmove indicated that the average asking price for a house in the UK increased 0.9% m-o-m to £264,875 in September after sliding 2.9% in August. On y-o-y basis, prices jumped 7.9% after advancing 5.3% in the preceding month. House prices in East Anglia and London rose 3.7% and 0.9%, respectively, while that in West Midlands and Wales fell 1.8% and 1.6%, respectively.