Yet another stockbroker

Happy Easter !!

No market letter this week.

Volatility has been high the last week which creates uncertainty. The US housing market is still in focus and Standard & Poor reports that institutes focusing on subrime mortage loans have indicated that weak creditors having problem paying there loans. The weak housing market will follow us week by week the next couple of month though this is one of the most important issues if US should go in to a recession or not.

Other important issue is that the unemployment levels are not increasing so the consumption can be intact and help the US getting a soft landing of the economy. As long as there is only the weak creditors having problems there will not effect the US economy overall but if there is signs that the important US middle class person having problems it will have great effects on the US and the global economy.

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.

The first quarter is to an end and the strongest regions so far have been the Balkan region. Singapore been also moving up strong and looking at interesting sectors Shipping and New energy been remarkable strong.

Currency

No change in the strong momentum for the dollar to have another year when it will be taking off versus the most other currencies in the world. As mentioned before, expectations that the FED is getting closer to stop increasing the interest will help the dollar keep on coming off. The signals from the FED the last couple of weeks have though been difficult to interpret so that may keep the movement on hold till more information regarding the interest hits the market.

This week there where some indications that the bounce the resent weeks are over. I predicted that this was just a bounce and that the uptrend was intact but mayby expected the market to be moving sidewards before moving up again, this seems not be the case but it is a bit early to tell.

The housing market is still something to keep in focus and though the FED increased the interest to 5,25% as expected the FED was a bit softer in its predictions regarding the inflation which might be a step closer to a cut in interest though it is not something that is close in time at this point. A movement in the interest or not, the housing market is still one of the greatest threats for the US economy at this stage.

Some analyst expects that the Fed cut interest as soon as May or June but that is probably to early. The strong job growth and the low unemployment rate makes it, in my opinion, to early to start cutting interest and risk the inflation to start moving up even further.

As pointed out the housing market is a concern and the strength in the housing market in the beginning of 2007 seems to been temporary. Stats the next two months regarding the housing market is something to follow closely the get an good view where it is going from here and what consequences it have for the US economy.

The Inflation in the US is still over the goal of 2% and the core inflation which is the one the FED looks into the most was up to 2,7% in February and it is important that it is not moving up any further.

So the never ending story if the market is having a hard landing or a soft landing will probably keeps on going for some time.

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.

The emerging market was as can be expected in top when the market this week moved up. India that been under pressure in the start of 2007 had a good week and might be hitting it lows for a while and the long up trend seems at this stage to be intact though the fundamentals makes the region looks a bit overvalued. Behind Asia and Latin America Eastern Europe moved up strong and the Balkan region have been amazingly strong in the beginning of 2007 and the Balkan region seems to be one of the strongest cards for this year.

The energy sector starting to looks interesting and it looks that the sector has possibilities to shortly make a new all times high. The valuation of the sector is low though the expectations to make strong profits in the next couple of years.

As mentioned Oil moving up strong and the Copper is just keep on moving upwards mainly because china is back and buying and pushing the prices up.

Currency

The FED helps the dollar to keep on coming off and the speculations of an cut in interest have kept on the pressure on the dollar and the downtrend are intact and as soon as the FED clearly states that an cut will be made not to far away the dollar will hit new lows.

The uncertainty in the US housing market still works as a wet blanket for the financial market. We have because of the increasing interests seeing the US housing market cooling down for the last 6 to 12 months but at this stage there is some uncertainty if the US consumers will, regardless of the housing market keep up the consuming in the near future, if not that will hit the slowing growth even more and gets its closer to an recession. Though no signs of recession are really visible today.

The mortgage level for the US housing sector is still manageable but when correction of the prices come this changes rapidly which is an concern for the Fed when adjusting the interest. Debt management have the last couple of months been giving some focus after that the US consumers in the last 3-4 years used there house as an wallet for consuming, this have been rapidly changing in the last couple of months.

The macro statistics have been weak overall but the job-growth is still good and no signs of recession can be seen there but that can change quickly because of the flexible US job market that can downsize rather quickly.

The level of company that invest is way to low to take over some of the weakening consuming, the fourth quarter was down 2,5% and January down 6%, but there is some signs that there is plans that the investment grade will move up in near future. There is important that companies sees business opportunities and use there historically great profits to invest to keep up the overall growth.

The overall market valuations still seems to be manageable and that will support the market in the coming weeks when uncertainty is out there keeping the pressure on.

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.

No trend to make you go long, no trigger that are good enough to make you put money in the market and it seems that is the way most investors think at this stage, but that can change quickly if we gets some good statistics and some positive market news.

Copper is still strong and it seems that every bounce we get is an opportunity to buy.

Currency

News regarding currencies is that China is starting an investment unit that will have the responsibility increasing the return on the currency reserve that till this day on routine been put in US bonds. This will over time put even more pressure on the US dollar when huge amounts will be put elsewhere.

After some damage control the market came back some this week but I think it will still be some uncertainty in the market in the near future. The long trend are intact and I think that next week will be an idea for the long term investor to put some money in if we have an shake out in the market.

One thing is for sure that it will be difficult to make some money in the market, no trend and great volatility.

I at this stage predict that the market will not be back in its long trend for a couple of weeks.

An issue is that the bounces we get hit harder and harder, the small healthy correction seems to just be a memory, why that is the case is hard to tell but the evolving financial market globally gives more and more mostly inexperienced private investors closer to the sell buttons which gives this huge moves in no time.

The Dow Jones tried with not much success to go through the 12300 level and it seems that the market will stay at these levels for some time before moving up any further.

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.

No big moves to report for this week after the last weeks drop. Asia was up some accept India that is been taking some downside the last month after that the government trying to implement some not very popular welfare programs that though might be a good the for the growth in the long run.

Finally the market bounced back, the market always does sooner or later, just impossible to know on what specific week or day. One day not to long ago I heard some words I would like to quote “never try to beat the market, be in the market”. The winners in the long run are the ones that always are in the market, try to pick high and lows is a success for very, very few.

Last week was a good week to make some adjustments to not fall in to making decisions based on other things than fact and rational thinking.

The market weakness has hit the emerging markets the most so in that case the weeks drop is by the book.

The word recession has ones again been making the market changing ear and at this point it only takes in the news in a negative way. Though I have been waiting for a bounce I do not thing this will be a very long bounce, maybe one week, and two at the most, then a movement sideways for a month or so will be the case. Moodys “risk of recession” indicator shows a 15 % risk for the economy to go in to a recession and that is an historical low probability.

The former FED chief starting out by saying a recession was just round the corner for the US economy but after some time the speech predicted that there is a risk for a recession but it is not likely. What was taking the Asian markets off guard was a rumour that there might be a 20 tax on profits made in the market, the news hit the shanghai market which came back 9 % in one day.

The growth is still strong, the inflation low and the profits are at historical very high levels and though the cycle probably hit the top the economy is moving on and the companies are investing and employing which will in my opinion take the market further in the year of 2007.

The inflation is not in focus at this point but the growth is, that the growth was weak in the third and fourth quarter in 2006 was expected but now it is important that the growth is not coming back any further to keep the market moving.

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.

A weak week all over with emerging markets in the bottom, a drop between -5-10% all over. The last two month winners Turkey, Asia and Latin America did take a hit. The Balkan region is though holding up pretty good considering the circumstances.

Raw materials as Copper and Zinc are holding up and Copper is an interesting turn around case that I will follow up on the next couple of weeks.

Currency

The US dollar was during the week taking a hit cause of the Greenspan speech and the weak trend for the dollar is still intact.

The consuming are falling in the US which is a indicator that the weakness in the housing market is making consumers to hold on to there money. The US growth is 2,3%, the lowest since April 2003. The battle between the slowing growth and the rising inflation is the worst scenario possible and this might send mixed signals to investors which might gives us unsteady movements the coming months.

The important issue in the coming month will me the core inflation that FED is focusing on for taking any further steps adjusting the interest.

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.

Not a very strong week on the global stockmarket and the coming weeks might be weak for the market overall concerning the mixed signals in the macro statistics in the last weeks. FED will as well probably not cut interest any time soon which will keep the pressure on the US consumers.

Regarding raw materials copper is moving up and the downtrend where the copper coming of nearly 40% seems to have been coming to an end. China is back buying which is a good signal that this outbreak on the upside not is a false one.

This week the final numbers on the US trade deficit was coming out and was landing on 763 Billon dollars, the number speaks for itself. The fact is though that the numbers can help the US growth in the short run cause US products are getting cheaper and foreign products more expensive to purchase for the American people.

The housing market is still an important issue and the FED chief Ben Bernanke have been indicating that he sees some stabilization and this is and will be an subject to keep on looking into further on.

Europe and Japan is two regions that analyst hopes will take on some of the growth that US is loosing. I been mentioned Japan as an dark horse before and this week there where some figures to confirm that when the growth numbers for the fourth quarter was 4,8%, expected 3,8%.

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.

Another positive week for the global market all over between 2-4% with Japan worth mentioning after strong growth figures in the last quarter 2006 helping

Currency

Not much movement for currencies of interest for this week, most emerging currencies have kept on to strengthen up against the Euro and the Dollar.

Weekly Marketletter (7) 2007-02-12

Goldilock seems to be a fact…or at least everyone hopes so. Speculations the last week have considered if the slowing US growth is a “mid-cycle correction” cycle where the stockmarket are driving forward during the slow down. The risk is of course that the slow down is getting to slow and move the economy into a recession.

The market is strong and are keep on moving up though there will be a bounce, it always comes, it is just a matter of time. There is difficult to foresee what will take the market down but speculations if the slow down is healthy or if it is a coming recession might be worth putting some money on.

The Michigan Confidence index was helping the market while coming in strongest in two years time which will help the market when it comes to consuming in the next quarter.

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 weekly overview of selected areas in 2007.

This weeks winner was China and the Eastern Europe region overall with an move between 2-4%.

Currency

The short interest in the US has been coming up in the last 12 month but seems at this point to take a pause. The signals from FED indicate that inflation are under control. Considering that the expectations on interest influence where money goes the bounce in the dollar we been seeing the first month of 2007 is just short term strength and the dollar will keep on coming off.

January is to an end and the stock market is keeping on moving up, why is that?

Mainly there is on the background of the surprisingly strong GDP growth in the fourth quarter where US as an example had a GDP growth of 3,5%, expected 3,0%. The strong growth combined with a low core inflation of 2,1%, close to FED:s goal of 2%. Strong growth combined with a low inflation, the market loves that. What worries is that the growth is holding up by private consumption, the company investments needs to come up to hold up the economic growth.

Housing market is another important issue has lately been moving on the downside in the US but is expecting to stabilize and some positivism has been showing.

The FED kept the interest on 5,25% on there meeting on the 31 January and was giving a brighter view of the economy growth and inflation. The ISM-Index though indicating that the economy will slow down as expected in the next couple of month.

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.

Another strong week for the global market with Turkey, Singapore and Germany in the lead. If we take a look on the one month developments Eastern Europe followed by emerging markets as India and Latin America is in the lead. Considering specific segment New Energy has been sailing up as a winner in the first month of 2007.

The speculative trading on raw materials as Copper and Zinc has resulting in prices in a historical volatile price range. The prices have at this stage coming back but there seems to be temporarily when the shortage of raw materials, to keep for example China and other emerging regions going, just won’t go away.

Currency

The short interest in the US has been coming up in the last 12 month but seems at this point to take a pause. The signals from FED indicate that inflation are under control. Considering that the expectations on interest influence where money goes the bounce in the dollar we been seeing the first month of 2007 is just short term strength and the dollar will keep on coming off.