29 juin 2011
Le rebond entamé suite aux bonnes nouvelles en provenance du Japon et à l’optimisme du marché quant à l’acceptation du plan d’austérité en Grèce soir ("on veut y croire") ne doit pas faire illusion: les Etats périphériques européens n’ont pour le moment par trouvé de solution pérenne à leurs problèmes de dettes. Le ballon d’oxygène probablement accordé à la Grèce à très court terme ne règle rien sur le fond. L’assistance respiratoire reste pleinement en vigueur. Il est donc probable que les difficultés en cours inquiètent de nouveau les marchés cet été, au mieux cet automne.
Dès lors, la dynamique en cours, baissière, ne devrait pas être interrompue. Les paramètres internes du marché (market internals) sont toujours faibles, et la hausse du jour – peut-être confortée sur le très court terme – ne doit pas être considérée comme un retournement majeur. en outre, la tendance sur les indicateurs économiques US est toujours à la détérioration.
Enfin, la configuration technique des indices, notamment du Cac, reste fragile. Au contact de sa MME 200j à 3900 pts aujourd’hui, le Cac va rencontrer si la hausse se poursuit sa MME 200 semaines vers 3985 pts. Autrement dit, le franchissement à la hausse des 3900 pts (donc de la MM200j) ne devrait pas suffire tant que la MM200 semaines n’est pas franchit avec du volume.
29 juin 2011
John P. Hussman, Ph.D.
Just a brief update this week as our annual board meetings are in progress – it’s notable that despite the brief reprieve of market concerns Thursday on tentative agreement over Greek aid, we actually saw very little change in the value of Greek debt. While there is a great deal of short-term attention on day-to-day developments on this front, credit spreads effectively indicate expectations of certain default within a roughly 2-year window, but very small risk of near-term default. Until we observe a firming in market internals (which have deteriorated markedly) and in leading economic measures (which have also weakened), we expect that enthusiasm about Greece may provoke short-lived market spikes and short-squeezes, but little of durable effect for the stock market.
For our part, we continue to focus on our measures of valuation and market action, both which are unfavorable at present. An improvement in the quality of market action could allow some latitude for a constructive market exposure, but with the recent advance past both the median extent and duration of cyclical bulls within secular bears (which I continue to believe is the appropriate characterization), the risk of significant market losses should not be underestimated. Presently, we estimate the prospective 10-year total return of the S&P 500 Index at about 4.2% annually, based on our standard methodology. This is better than we observed in May, but the modest improvement since then should be some indication of the limited extent to which the recent decline has restored appropriate valuations.
22 juin 2011
The International Monetary Fund said Spain must step up efforts to reform its economy as Europe’s sovereign debt crisis threatens to damp growth. “The repair of the economy is incomplete and risks are considerable,” the Washington-based IMF said in its annual appraisal of Spain yesterday. There must be “no let up in the reform momentum” to bolster the recovery and reduce a 21 percent unemployment rate that is “unacceptably high,” the fund said. Spain’s Socialist government is carrying out the deepest budget cuts in at least three decades while raising the retirement age and reducing firing costs. Prime Minister Jose Luis Rodriguez Zapatero overhauled wage-bargaining rules on June 10 in the latest step aimed at reining in borrowing costs that surged to the highest in a decade last week on mounting expectations of a Greek default.
“Financial conditions could deteriorate further, reflecting rising concerns about sovereign risks in the euro area,” the IMF said. “This could put additional pressure on sovereign and bank funding costs for Spain, which in turn could feed back to the real economy.” The IMF called on the government, which has passed two labor overhauls in the past year, to make deeper changes to reduce the highest unemployment rate in Europe.
20 juin 2011
It is never reassuring when a chief executive admits to being scared. But Hong Kong’s Donald Tsang is right: the cost of property in the city really is “quite frightening”.
From Mumbai to Melbourne, real estate prices are stalling as higher interest rates take hold. Not in Hong Kong, though, where the widely followed Centa-City leading index of residential prices is still rising, prompting a fourth round of corrective measures from the central bank earlier this month. For locals, there are clear incentives to load up: still-affordable mortgage rates, and a persistently weak currency. Over the past ten years the Hong Kong dollar has depreciated against everything bar the Mexican peso.
The more important driver, though, comes from over the border. For mainland Chinese, a 22 per cent gain for the renminbi since 2001 is reason enough to go long Hong Kong. Further, an apartment in the city is a hedge against instability – safely away from the long arm of Beijing, yet still close to home. Retail sales data show mainlanders’ ferocious purchasing power. Jewelry and watches accounted for 21 per cent of the total value of retail spending in March, for example – higher than all food, booze and supermarket bills combined. At a recent sale by Sun Hung Kai, the world’s largest listed developer, buyers put down 20 per cent with nothing to follow until possession in August 2013. But despite such tactics, more than 90 per cent of units went within a day. Hongkongers mutter about the extraordinary 1997 peak, achieved before the handover from the UK to China. That is two percentage points away in nominal terms, but the main Centa-City index is still 24 per cent below that level, on a trade-weighted, exchange rate-adjusted basis. As long as China keeps humming, prices can, and probably will, go higher.