Most read
‘Optimistic borrowers’ could endanger housing market, RBA says...
‘Optimistic borrowers’ could endanger housing market, RBA says...
Latest Podcast
Home values up 30% (or are they); NFTs taking the world by storm, and why Keatin...
Home values up 30% (or are they); NFTs taking the world by storm, and why Keatin...
Resources
There is $17.5 billion in lost and unclaimed super across ...
There is $17.5 billion in lost and unclaimed super across ...
Invest
What to know about investing in Asian markets
Optimistic investors are looking to cash in on countries that have fared better during the COVID-19 pandemic. Here’s how Asian markets are shaping up.
What to know about investing in Asian markets
Optimistic investors are looking to cash in on countries that have fared better during the COVID-19 pandemic. Here’s how Asian markets are shaping up.
The Australian market opened higher today, with the S&P 200 growing by 1.3 per cent, moving beyond 6,000 points.
Yesterday’s trading saw Japan’s benchmark Nikkei 225, grew by 1.29 per cent, while South Korea’s Kospi +2.86 per cent.
Hong Kong’s Hang Seng was up 1.2 per cent, while the Shanghai Composite added 0.5 per cent.
According to JP Morgan’s global market strategist, Kerry Craig, the Asian markets have a number of tailwinds.
“First, there is the general reopening of the economy from COVID-19 and the fact that economic activity is improving from a very low level,” Mr Craig said.
“Second, the oil price has stabilised as fears around oversupply have eased.
“Third and importantly, the sheer scale of stimulus measures such as the ECB adding more to its QE program is bolstering risk sentiment. The general view seems to be that markets are looking past the near-term weakness in earnings and into 2021,” Mr Craig explained.
Mr Craig noted that countries which have recently experienced lockdowns could benefit from greater consumer spending.
“Also, there is some release of pent-up demand after the lockdown. With the earnings and the economic outlook in focus, the market is not focused as much on political risks or unrest in the US,” Mr Craig continued.
While highlighting that the economic data remains weak, with Australia facing its first recession in 29 years, he cautioned investors about short-term volatility.
“If the economic data remains weak for the moment, markets are likely to continue to discount that as being backward-looking.”
“However, a risk is that markets are pricing in a lot of good news that might not materialise in the second half of the year.”
Finally, Mr Craig cautioned investors that in the long run equities might do well, but it is important to invest in companies that can survive in the short term.
“In the very long run, equities are going to do well as they are coming from a lower base.”
“However, that will come with volatility. Currently, we are neutral towards equities in portfolios relative to other assets, and we prefer the US equity market for its slightly more defensive bias.”
“Stock picking has become more important as investors sift through companies, looking for those who can best survive and thrive through the pandemic, leading to greater focus on cash flows and balance sheets and those companies able to maintain pricing power and greater market share,” Mr Craig concluded.
About the author
About the author
Stock market
Ethical investing tipped to drive ETF market
Following a volatile 2020 where investors poured into ETFs, shareholders are tipped to focus on ethical investing and technology as the recovery from the COVID-19 pandemic continues, an industry expe...Read more
Stock market
‘The concept of collective investing is here to stay’
The phenomenon of retail investors acting as a collective, led by social media and celebrity investors, is here to stay, says one expert. ...Read more
Stock market
What is short selling and should you do it?
Short selling stocks may sound like a good investment strategy when you’re after quick and big returns, but is it worth the risk? Here’s a rundown of why shorting stocks may not be a sound stock t...Read more
Stock market
How much insider trading really happens?
There are at least four times as many people who get away with insider trading than the number of those caught by prosecutors, new research has revealed. ...Read more
Stock market
Why you should be wary of the tech stock bandwagon
After a strong year of tech stock gains, tech shares have been on a decline in recent weeks as increasing bond yields rattle equity markets. ...Read more
Stock market
GameStop set to release first earnings since Reddit stock market rally
The video game retailer at the centre of the WallStreetBets saga is set to post its first quarterly market update since the fiasco began, with social-media investors heavily tipped to continue backing...Read more
Stock market
What is thematic investing and why it could be a fad
Long-term investors are being urged to ignore market fads and instead focus on identifying major socioeconomic, environmental and technological themes, an industry expert has explained. ...Read more
Stock market
ASX 300 companies cash in on JobKeeper scheme
Most of Australia’s ASX 300 companies that received JobKeeper payments did not need the subsidy as they recorded increases in profits throughout the calendar year, according to a study. ...Read more
Home values up 30% (or are they); NFTs taking the world by storm, and why Keating thinks Aussies will be ‘poor’ in retirement
Listen now
Raging floods, the tech stock bubble and the ongoing SG debate
Listen now
Meet the Manager with Trilogy’s Philip Ryan: RBA rates and property price growth
Listen now
The continued property boom, ethical investing and engaging with your super fund
Listen now
Stock market
Ethical investing tipped to drive ETF market
Following a volatile 2020 where investors poured into ETFs, shareholders are tipped to focus on ethical investing and technology as the recovery from the COVID-19 pandemic continues, an industry expe...Read more
Stock market
‘The concept of collective investing is here to stay’
The phenomenon of retail investors acting as a collective, led by social media and celebrity investors, is here to stay, says one expert. ...Read more
Stock market
What is short selling and should you do it?
Short selling stocks may sound like a good investment strategy when you’re after quick and big returns, but is it worth the risk? Here’s a rundown of why shorting stocks may not be a sound stock t...Read more
Stock market
How much insider trading really happens?
There are at least four times as many people who get away with insider trading than the number of those caught by prosecutors, new research has revealed. ...Read more
Stock market
Why you should be wary of the tech stock bandwagon
After a strong year of tech stock gains, tech shares have been on a decline in recent weeks as increasing bond yields rattle equity markets. ...Read more
Stock market
GameStop set to release first earnings since Reddit stock market rally
The video game retailer at the centre of the WallStreetBets saga is set to post its first quarterly market update since the fiasco began, with social-media investors heavily tipped to continue backing...Read more
Stock market
What is thematic investing and why it could be a fad
Long-term investors are being urged to ignore market fads and instead focus on identifying major socioeconomic, environmental and technological themes, an industry expert has explained. ...Read more
Stock market
ASX 300 companies cash in on JobKeeper scheme
Most of Australia’s ASX 300 companies that received JobKeeper payments did not need the subsidy as they recorded increases in profits throughout the calendar year, according to a study. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
