From a value perspective, there should not be much focus on economic trends and predicting the future. However, one still must pay attention to trends as to realize how it will impact values of securities and/or value of individual security based on market developments.
I am surprised the market had the biggest gain in 5 weeks due to a lower than expected fall in home sales in US.
- Home sales are still falling albeit at a slower rate, rising inventory from foreclosures and still existing credit defaults coming up in 2010/11
- Europe debt concerns after Portugal got downgraded, other than Spain, Ireland and Greece. Not that we really put 100% faith in the credit raters!
- Rates are low, only way is up, evident from India's rate hike
- Concerns on China's excess capacity for materials, office space and frothy residential markets
Is it me or the recovery since March 2009 very rapid and leaving little to do now?
However, with large liquidity and low rates, the market is likely to be well supported in the short run.
The asset cycles are slowly shifting once again, look out for equities!
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Financially speaking
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