This time is different?
The report season has been starting and it’s too early to tell but it looks in general pretty good so far.
Considering a US recession or not is a topic for the beginning of 2007 and so far it doesn’t look very likeable. But I think that the growth in US is coming back a bit but that will not affect the global growth as much as the weakening dollar. The US is important for the global economy but not as much as before though the emerging regions in the world are today standing for more than 50% of the global economy, China is closing in on Germany as the third biggest economy which is impressive and are day by day changing the map for the importance of the US growth and economy.
“This time is different” have been heard before considering Japan but I am starting to think it really can be an interesting case for 2007, the “yen carry trade”* seems to be a never ending story though. I will follow up on Japan in the forthcoming market updates though it is not on my “market hotlist” at this stage.
China is just keep on growing in an impressive rate. The fourth quarter GDP growth of 10,4% connected to an inflation of 1,5% for 2006 speaks for it self. Investments in China are booming with almost a 25% growth for 2006. Though the charts looks pretty steep not many things seems to stop this machine.
Global Stockmarket
This part will consider regions as the US, Europe, the Nordic region, Eastern Europe, South America and Asia. A strong global growth have been moving almost all markets to good result for 2006 and below is quick overview of areas for the 2007.
In general market has been ticking up this week with an exception for China where the strong GDP numbers scared the market for pushing the inflation up. Biotech and Health are industry segment that been up in the beginning of 2007 as well as Europe and the Nordic region that been moving up the expectation for the GDP growth for 2007.
Currency
Let the trend be your friend and keep on going short dollar. Not much to comment on for this week movement.
* Investors lending Yen and buys US Bonds with higher interest than they have to pay in interest in Japan.
This entry was posted
on Monday, January 29th, 2007 at 7:36 pm and is filed under Weekly Market Update.
You can follow any responses to this entry through the RSS 2.0 feed.
You can leave a response, or trackback from your own site.