Check out the latest investment and financial advice from the Royal Gazette:
With the US stock market averages hitting new highs, selectivity will likely be the key to successful investing in the months and years ahead. Some trends will persist but others may fade as the extended economic recovery approaches record duration.
For one thing, investors should prepare for slower growth going forward. A recent report from the International Monetary Fund forecast world gross domestic product growth will decelerate to 3.5 per cent this year from 3.7 per cent in 2018. Longer term, the rate of forward progress will probably be much lower.
Impediments to growth in today’s world are rising protectionism, increasing trade tensions, a decline in business confidence and questions about what the Fed and ECB will do with their stretched balance sheets and the large and growing budget deficits across the developed world.
According to another report published by Organisation for Economic Co-operation and Development, US growth is forecast is to decelerate to 2.6 per cent growth in 2019 and 2.2 per cent in 2020, down from the last year’s rate of 2.9 per cent. However, a US recession is not expected.
Meanwhile, Europe is struggling with a moribund economy. Italy is in recession and Germany is very close to having one officially. European equity markets have dramatically lagged the US over the past few years and interest rates in the euro currency are still negative for most short duration bonds.
The European Parliamentary Research Service recently published a long-ranging report on global output which listed the following megatrends:
• A richer and older human race.
• A more vulnerable process of globalisation, with uncertain leadership.
• A transformative industrial and technological revolution.
• A growing nexus of climate change, energy and competition for resources.
• Changing power, interdependence and fragile multilateralism.
Economic growth is simply the product of a country’s work force growth and the productivity of those workers. Financial leverage has also played a part in temporarily magnifying corporate profits and GDP in many regions. However, leverage has its limits and usually ends with a need to deleverage.
For more insights continue reading here.
Here is today’s stock market updates from Bloomberg:
- U.S. futures point to positive open; Chinese stocks outperform
- Earnings season continues with results from Bank of America
Global stocks traded modestly higher Tuesday as investors digested corporate results rolling in for clues on the economic outlook. The dollar edged up while Treasuries held steady.
The Stoxx Europe 600 Index climbed, led by retail and chemical shares. In Asia, shares in China and Hong Kong outperformed markets in Japan and South Korea. S&P 500 futures pointed to a slightly positive open after the U.S. benchmark slipped from a six-month high as the earnings season kicked into high gear. Bank of America Corp. and BlackRock Inc. results are up next on Tuesday. Treasury yields ticked lower after data showed China’s holdings rose for a third month. The yen inched higher.
Investors have spent the holiday-shortened week so far in wait-and-see mode as conviction in the rally that’s powered stocks this year gets tested. Volumes remain muted as traders assess a complex global economic picture. Central banks are also in the frame, with Chicago Fed President Charles Evans, who currently sees rates on hold until the fall of 2020, saying that the nation’s central bank may need to cut them if inflation falls.
“We are going into this earnings season with the most pessimistic expectations and earning revisions ratios since 2016,” Isabelle Mateos y Lago, chief multi-asset strategist at BlackRock, said on Bloomberg TV. “Obviously the markets are not expecting too much and a lot of good news are already priced in, so it makes sense for the market to take a pause.”
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Here’s the latest global stock market and economic updates from LOM Financial:
Global markets continued their rebound in March with the MSCI World Stock Index gaining 1.05% and the S&P 500 increasing by 1.79%. The technology sector continued to climb last month but more defensive sectors such as consumer staples and real estate also fared well as interest rates declined. Investor sentiment is currently mixed as relatively strong earnings and a decent macroeconomic environment in the U.S. has been met with weakening demand out of China, an inverting Treasury curve and the ongoing challenges to an orderly British exit from the Eurozone.
Equity markets have mostly recovered from last year’s Q4 correction, with the S&P 500 rallying 13.1% since the beginning of the year and 20.6 % from the December 24, 2018 bottom. The MSCI World Stock Index has gained 11.9 % this year and is up 16.9% from the market bottom. Despite positive equity market performance in Europe last month, the region continues to exhibit economic weakness. Italy fell into recession (two consecutive quarters of shrinking growth) while Germany narrowly avoided a recession as it has struggled with falling industrial output, driven largely by the automotive sector.
Britain, struggling to find consensus on an amicable exit from the EU, has secured a short extension to the original deadline on the condition of another meaningful Brexit vote. That vote has since failed as British Parliament was unable to agree on any of the eight proposed terms of Brexit. Donald Tusk, the President of the European Council, called for an emergency EU summit after UK Prime Minister May’s proposal was defeated for a third time.
The United States and Canada have been relative safe havens during the past quarter. Macroeconomic indicators still appear to be strong on a relative basis. However, economists expect slowing GDP growth in the U.S as the short-term boost from the Trump tax cuts begins to run off. Importantly, the Federal Reserve’s shift to a more dovish stance has been well received in the equity markets. At the start of the year, the Fed was looking at one to three rate hikes, but they have recently indicated they may do none at all. The shift in stance has helped the equity markets regain most of last year’s lost ground. However, the ongoing trade war and return to more protectionist policies around the world continue to keep equity markets on edge.
Continue reading here.
It is common for most beginner investors to often ask if it is really necessary to hire someone who are well-versed in dealing with financial matters – like financial advisors. Although, they find it costly, however worth it. Now, if you’re planning to hire one, here’s a helpful and feasible tips from businessinsider.com to consider:
Choosing a financial advisor is a big decision.
Being aware of these seven common blunders when choosing an advisor can help you find peace of mind, and avoid years of stress.
1. Hiring the first advisor you meet
While it’s tempting to hire the advisor closest to home or the first advisor in the yellow pages, this decision requires more time. Take the time to interview at least a few advisors before picking the best match for you.
2. Choosing an advisor with the wrong specialty
Some financial advisors specialize in retirement planning, while others are best for business owners or those with a high net worth. Some might be best for young professionals starting a family. Be sure to understand an advisor’s strengths and weaknesses — before signing the dotted line.
3. Picking an advisor with an incompatible strategy
Each advisor has a unique strategy. Some advisors may suggest aggressive investments, while others are more conservative. If you prefer to go all in on stocks, an advisor that prefers bonds and index funds is not a great match for your style.
4. Not checking references
Most advisors are happy to offer references to prospective clients. Calling references only takes a couple of minutes, and it can help put you at ease when handing over the keys to your bank account.
Continue reading here.
With the advent of social media itself, most brands across the globe heavily rely on this powerful marketing tool. It has created a huge impact in the business world, making every life of entrepreneur relatively easier and convenient. Here are the basic, meanwhile, helpful tips you might want to consider:
Establish business goals
Social media – a business platform that has a lot to offer in terms of business ideas and marketing schemes. In which you must certain your goals and objectives, beforehand. Realistically, the business may rise and fall every now and then, but having a clear direction to where your business is heading in, can help you achieve a positive outcome and reap future rewards.
Optimize social media presence
Being the most efficient and effective marketing tool in terms of cost and convenience nowadays, it becomes relatively easier to make your brand visible to your customers worldwide. Optimizing social media presence may take time, but let it be the large chunk of your entire investment without putting your money at risk.
Understand your customer’s behavior
Apart from learning the demographics of your targeted customer, it is vital to understand their buying behavior online, which includes their habits, needs and wants. Customer satisfaction is highly important. It can also be a key to establish a long-term relationship with them.
Many large financial firms are eyeing AI because of it’s significant potential in the industry. According to Christine Qi, Domeyard’s co-founder and partner, “We rely on the help of machines to make easier and faster predictions of what will happen in the next second or minute.” Find out on CNN Business for more insights:
Artificial intelligence and machine learning might sound like the stuff of sci-fi movies. But hedge funds, major banks and private equity firms are already deploying next-generation technologies to gain an edge.
Citigroup (C) uses machine learning to make portfolio recommendations to clients. High-frequency trading firms rely on machine learning tools to rapidly read and react to financial markets. And quant shops like PanAgora Asset Management have developed complex algorithms to test sophisticated investment ideas.
“It takes emotion out of it. Everything is rational,” Mike Chen, an equity portfolio manager at Boston-based PanAgora, told CNN Business from the sidelines of the Cayman Alternative Investment Summit in Grand Cayman.
“We’re not crazy pointed-hair scientists,” said Chen, whose quantitative investment firm manages about $43 billion in assets.
Much of the technology that elite investors use isn’t really new. Financial firms are just better able to harness the power of AI and machine learning because today’s computers can process information much faster. And there now exists vastly more data than there did years ago.
The rise of machine learning
Still, technology is rapidly disrupting the financial industry — and will continue to do so.
“The rise of machine learning will really make our industry unrecognizable in the future,” said Anthony Cowell, head of asset management for KPMG in the Cayman Islands. His clients include some of the world’s largest asset managers, hedge funds and private-equity firms.
For instance, Citi Private Bank has deployed machine learning to help financial advisors answer a question they’re frequently asked: What are other investors doing with their money? By using technology, the bank can anonymously share portfolio moves being made by clients all over the planet.
“Traditionally that kind of information was sourced from your network. You might have had a few coffees or heard about it over a cocktail,” Philip Watson, head of the global investment lab at Citi and chief innovation officer at Citi Private Bank, told CNN Business. “Now, we can share insight that is very valuable.”
Citi also built a recommender engine that uses machine learning tools to advise clients. The platform recommends tailored research reports, solutions and even alerts clients of major events such as the maturity of a bond in their portfolio.
Continue reading HERE.
Here’s the latest global stock market and economic updates from Forbes:
- Brexit, Shutdown Add to Uncertainty
- Earnings Season Kicks Off on Mixed Note
- Fed Takes a Backseat in Investor Concerns
- Treasuries Buck Economic Trends
- It’s not too early to prepare for Tax season
February could bring a heaping plate of geopolitical drama to markets around the world, potentially helping to end a brief calm that settled over January.
As the month starts, markets were basking in the Federal Reserve’s decision to hold interest rates steady, along with better than expected earnings results from Boeing and Apple. In fact, many Wall Street analysts have indicated they now expect no interest rate increase at all this year after the Fed said it will remain “patient.” So stocks begin February propelled in part by the ongoing earnings season and the Fed’s dovish tone.
Still, several question marks hover over the next few weeks. First, the U.S. and China only have about four weeks until their self-imposed early March deadline to get some sort of trade agreement in the books, or we could see tariffs jump. Of course, any more trade tension could likely put the market in a tailspin in both countries and perhaps around the world. As of late January, optimism seeped in around positive developments, but there was no word of an imminent deal.
That’s just one reason why volatility—which surged in December as investors fretted about a possible global economic slowdown—could once again become a factor into February. The markets spent January recovering from December’s sell-off, but as a new month begins nothing is certain. Even the government shutdown—which ended with stopgap funding through Feb. 15—could resurface if lawmakers don’t agree on an immigration and border security deal.
As of late January, the S&P 500 Index was up approximately 7% year to date, the Dow Jones Industrial Average was up about 7.2% and the Nasdaq was up 8.2%. At the end of last year, key sectors like info tech, financials, and transports had remained under pressure, signs that investors apparently had doubts about U.S. and global economic growth. But those sectors showed much more buoyancy throughout January. The fact that COMP is leading the major indices might be an early sign of investors starting to embrace more risk, since it’s dominated by tech and biotech names. In addition, the small-cap Russell 2000 had the best start to a year since 1987.
Continue reading HERE for more insights.
For the latest global market and economic updates, check out LOM Financial:
Global markets rallied last week. The MSCI World Index gained 1.43% while the SPX Index gained 1.62%. The ex-US markets were a bit more subdued. The Nikkei was flat 0.08% (in local currency), and the FTSE Euro ETFs (reported in USD) gained 0.95%.
Weakness in China
The week opened down as weakness in China caused chipmaker NVIDIA (-9.63%) and construction company Caterpillar (-4.35%) lowered profits forecasts. A sizeable portion of revenues, 70% and 22% are attributable to the Asian region for NVIDIA and Caterpillar, respectively.
United States Government Shutdown Ended
The longest government shutdown in US history ended after a 35-day standoff. The Congressional Budget office estimated the shutdown cost $11 Billion in economic activity. ABC News polls showed the average American was disproportionately blaming Trump and the Republican party. Unsurprisingly, this was split along party lines with independents explaining the difference. Ending the shutdown backfired amongst the President’s base, who view this as an outmanoeuvring by the opposition. We should see some makeup on spending since paychecks have been restored, though some of that spending will not be recovered. This is unlikely to have an impact on the 2020 elections as we are too far out.
Macroeconomic data was generally positive, beating or meeting expectations in 73.5% of key global metrics. This should reinforce the notion that part of this rally is justified.
Continue reading here for more insights.
Choosing the right and safe investments is quite tricky, especially during volatile times in the market. These low-risk investment recommendations from Bankrate might help you decide which investment you must consider to meet your financial goals.
Why low-risk investments?
After a volatile end to 2018, wary investors may be searching for stability in 2019. Even for aggressive stock market fiends, an investment portfolio that’s diversified with less-risky assets is vital to ensure your earnings see growth over time.
What to consider
The trade-off, of course, is that in lowering risk exposure, investors are likely to see lower returns over the long run. That may be fine if your goal is to preserve capital and maintain a steady flow of interest income. But if you’re looking for growth, consider investing strategies that match your long-term goals.
Risk tolerance and time horizon play big roles in deciding how to allocate your investments. Conservative investors or those near retirement may be more comfortable allocating a larger percentage of their portfolios to less-risky investments to minimize risk. These are also great for people saving for short term (about five years or fewer) or intermediate (around a decade) goals.
Those with stronger stomachs and workers still accumulating a retirement nest egg probably can fare better with riskier accounts, as long as they diversify. Be prepared to do your homework and shop around for the accounts that fit both your short- and long-term goals.
If you’re looking to minimize your portfolio’s risk, here are a few of the safest investments to consider.
Overview: best investments in 2019
1. Certificates of deposit
These federally insured time deposits have specific maturity dates that can range from several weeks to several years. Because these are “time deposits,” you cannot withdraw the money for a specified period of time without penalty.
The financial institution pays you interest at regular intervals. Once the CD matures, you get your original principal back plus any accrued interest. Today you can earn as high as nearly 3 percent interest.
Risks: CDs are considered safe investments. However, they do carry reinvestment risk — the risk that when interest rates fall, investors will earn less when they reinvest principal and interest in new CDs with lower rates. The opposite risk is that rates will rise and investors won’t be able to take advantage because they’ve already locked their money into a CD.
Consider laddering CDs — investing money in CDs of varying terms — so that all your money isn’t tied up in one instrument for a long time. CD returns are inching up as interest rates are on the rise, but it’s important to note that inflation and taxes could significantly erode the purchasing power of your return.
Liquidity: CDs aren’t as liquid as savings accounts or money market accounts because you tie up your money until the CD reaches maturity — often for months or years. It’s possible to get at your money sooner, but generally you’ll pay a penalty.
For more investment ideas, continue reading HERE.
Here’s more update from CNBC for Oil prices:
Oil prices should sit around the $60 to $80 a barrel range throughout 2019 with volatility set to remain in the energy markets, Crescent Petroleum’s chief executive told CNBC Thursday.
Speaking at the World Economic Forum (WEF) in Davos, Majid Jafar, CEO of the United Arab Emirates-based oil and natural gas producer, said prices were subject to huge fluctuations and predicting prices was as hard as it had ever been.
“(Prices are) the most volatile in 30 years. That’s partly because of certain tweets but also because there isn’t much spare capacity and that’s where you see volatility,” he said.
Jafar said he remained optimistic of a trade deal between the U.S and China and that the global economy was still growing “pretty well.” The CEO said that should provide a decent base for oil prices across the 2019 calendar year.
“It will be in this $60 to $80 range. It will be volatile, but $90 is more likely than $40,” he said.
Continue reading HERE.