Tuesday, 15 August 2017

Draghi worried about the power of the euro?

The head of the ECB, Mario Draghi, is worried about the strength of the single currency against the dollar and other major currencies. Since the beginning of the year, the euro has risen by 12% against the dollar.
Thus, Draghi expressed same fears, repeatedly given by the previous ECB chief, Jean-Claude Trichet, that the strong euro could seriously hurt growth prospects for the eurozone economy.
In addition, the strong European currency puts a pole in the wheel of inflation. And inflation is one of the main threats to the growth of the eurozone economy.

Monday, 14 August 2017

Oil is cheaper after data from China

The price of oil fell on the first day of the new week after a slowdown in the production of refinery activity in China. This has raised serious concerns about the recovery of world demand for "black gold."
The Brent with delivery in the next month is traded at $52 a barrel, or with a 10-cent lower than its last closing levels at the end of last week.
US crude oil traded down by 0.1 percent down to $48.78 a barrel.
Chinese refineries produced 0.4% more oil in July, compared with last year at a level of 45.5 million. Or, the processing was 10.71 million barrels per day, according to China's national statistics.
This is the smallest production on a daily basis since September.

Friday, 11 August 2017

Buffet against hedge funds - 9 years later

Nine years ago, Warren Buffett agreed to make a bet called "one million dollar bet". In it, the billionaire will be betting with his opponents from the $3.5 billion Protege Partners hedge fund to beat their sophisticated investment schemes and active selection of companies with a simple investment in a S&P 500 index fund (Vanguard S&P 500).
It was a long time ago - almost nine years ago, and to the end of the bet remain about six months, given that it ends on December 31 this year.
How are things to date?
Buffett leads, with lots. It must be a real miracle to lose the bet. After nine years, the hedge fund portfolio rose by 22 percent, while the Vanguard Admiral Shares S&P 500 Index Fund added 85.4 percent to its value. That is almost four times more.
The yield on the index fund was higher than that of the hedge fund in seven of the past nine years.

Thursday, 10 August 2017

The US companies with the highest growth in their results for 13 year

US companies are delivering better reports on their earnings and revenue than expected. They do this at the highest pace since 13 years.
Does this, however, lead to an increase in indices? Not exactly ... Although it is generally believed that the results of companies are the source of index growth.
Company profits rose by 9% yoy, exceeding the average growth expectations of 3%. Sales grew by 5% yoy. 55% of companies with sales on international markets have exceeded expectations in terms of profits and sales, compared with 30% for companies represented only in the United States.
In fact, there is the first case since the 2000s when investors saw no "prize" for better results, according to Bank of America Merrill Lynch.
This is a "potentially dangerous" anomaly we have not seen since 17 years, according to analysts from Bank of America Merrill Lynch.
This lack of reaction may be another sign of the late stage of the upward cycle we are in, according to Savita Subramanian, a bank analyst.
This does not mean that the situation is too negative at the moment. It seems, however, that this growth in the companies' results was apparently already in the levels.

The gold with a two-month peak

Gold reached a two-month high, reaching the highest value of $1 283.80 per ounce.
At the core of the rise was the increased tensions between the United States and North Korea. That is, the appreciation of the precious metal was predominantly determined by the search for a safe haven on the part of the investors.
Where the dollar will move to will largely depend on the direction of trading in the US currency, according to analyst Vince Lance of Echobay partners.
But if gold continues to appreciate, in the midst of appreciation of the dollar, it will certainly be possible to say that its demand has been predetermined by the search for security. And such an appreciation, according to Lansky, will not be fundamentally justified and will rather be short-term.
Can gold continue to rise to $1,900?
According to the expert, this is possible, but there are several key factors that predict such an increase and which were present at its previous appreciation to this limit.
We need a substantial change in the market situation to see the explosion in the price of gold to similar values.

Wednesday, 9 August 2017

Shares are cheaper, the dollar and gold are rising after Trump's threats

Global stocks fell and gold rose after US President Donald Trump said in connection with North Korea's provocations that they would be welcomed with fire.
The dollar appreciated against other major currencies as a result of increased uncertainty.
The S&P 500 index ended with minimum daily values ​​yesterday, following Trump's comments.
Trump's comments came after earlier yesterday from the capital of North Korea said they were ready to give Washington a cruel lesson of available strategic nuclear power in any US military action.
Serious increase also registered the volatility index. After the previous day VIX ended at a level below 10 points, it grew heavily yesterday, ending at its highest levels for a month.
The dollar rose by 0.5% against the euro to 1.1730 dollars for one euro.
Gold added about 1% to its value, following increased geopolitical tension, rising at trading levels of more than $1,273.

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