The US outperformance since the financial crisis has captured investors' attention. This is also reflected in the stock market valuations. But weaker economic growth in other parts of the world doesn't automatically mean that there are no gems to be found in other stock markets. And as we can learn from China, strong economic growth does not always automatically translate into a stock market boom.
"Financial oppression", i.e. a situation in which central banks manipulate interest rates (as in Japan), is not an unlikely scenario. Negative real interest rates and inflation help countries manage their debt. With inflation, the economy and tax revenues grow, but the nominal value of the debt remains the same.
One of the things I've been pondering lately is the rate of the future stock market recovery in Finland. During the pandemic, we saw a so-called V-shaped recovery, where the stock market fell sharply, but a mega-recovery quickly lifted share prices to new highs. The stock market loosely follows corporate results. If the outlook for companies remains bleak, the stock market will also suffer. Without earnings growth, there is no point in splurging on stocks.
Sampo Group delivered strong premium growth and resilient underwriting margins in 2023, despite the year being characterised by elevated severe weather and large claims experience, as well as unfavourable currency movements.
The S&P 500, the world's most important equity index, has had a good earnings season. Just under 80% of companies have exceeded analysts' expectations, average earnings growth has been around 7% and share price reactions to the results have been snappily positive, according to Bloomberg data.
In this post I will talk about the Fed's interest rate decision and move on to the credit cycle phase. The optimistic view is that a new credit cycle is about to start, fueling economic growth. Finally, I have some interesting data on how rising interest rates affect the profitability of US companies.
Tech companies fronted by AI hype superstars NVIDIA and Microsoft have scaled new heights. Microsoft became the first company in the world to break the $3 trillion mark. Many technology companies have risen by hundreds of percent over the past 18 months. The world's main stock index, the S&P 500, has surpassed the level it touched in early January 2022. At the time, there was widespread talk of a stock market bubble.
So it’s fair to ask whether we are in a bubble again.
In this article, we’ll talk about how Nasdaq Helsinki is likely to attract more takeover bids this year as stocks flatline. After that, we’ll turn our attention to China for a change, where the economic development is less than inspiring. Because of the weak domestic economy, Chinese companies are trying to dump their excess production overseas, which is increasing competition and causing the rest of the world to resort to protectionism in response.
Vi är väldigt stola över att Inderes analytiker Lucas Mattson deltar i uppesittarkväll på onsdag 24/1.
Äntligen är det dags igen för två timmar med aktier, sparande och investeringar! Vi har laddat upp med två riktigt spännande gäster!
Vid årsskiftet slog klockan inte bara för 2023, utan också för reformen av EU:s skuldregler. En kompromiss mellan unionens finansministrar uppnåddes slutligen i sista minuten i början av december. Och de nya skuldreglerna var verkligen en kompromiss, eftersom varje medlemsland inklusive Italien kunde utropa sig som vinnare när de såg resultatet.
In this post, let's talk about expectations for the upcoming Q4 earnings season. The performance of tech giants like NVIDIA is expected to shoot through the roof in the coming years. Otherwise, the recovery from the downturn is stickier in the US. Let's also look at the upcoming earnings season in Finland. But to start with, I have a few words on the latest inflation data.
In this post, let's talk about the themes of the year that has just begun and the upcoming elections in 2024. The US presidential election is a proper nail biter for investors. Equally exciting is China's reaction to the Taiwanese presidential election. We will also take a brief look at the state of the US labor market, which is sending worrying signals of a deteriorating economic situation.
China’s middle class has been expected to become a growing engine of the global economy next to the American consumer, but the growth has been slowed not only by the general uncertainty created by the COVID pandemic, from which recovery has been slow, but also by wealth melting away.
The stock market is already pricing clear policy rate cuts for next year. The famous Taylor interest rate rule is in its own interest rate reading, but like market expectations, it has also taken a turn toward falling central bank rates.
In my last post of the year, the traditional Christmas Special, we take a reflective look back at the past stock market year. Investors were expecting a recession and muted returns in 2023, but what we got was a real bull market acceleration. I then go through next year's forecasts, expectations and share valuation levels.
In this post, let’s talk about the ECB's interest rate decision and how interest rate cuts will benefit the European and especially the Finnish economy. I talked about the Fed's intentions to start cutting its policy rate next year in my previous post. We will also look at global industrial indicators. The bottoms may be at hand. This is good news for stocks that have already taken a head start.
In this post, let's talk briefly about inflation, which is still a nuisance but not a surprise in the US. The Fed's interest rate decision will also be discussed quickly. The main theme is hunting for unicorns to add to your portfolio: it's like looking for a needle in a haystack. Less than 1% of the thousands of unicorns have achieved a cash flow of more than a billion dollars.