Markets

If you look at long-term investors, whether you are talking pensions funds, endowment, foundations, they are coming in for 5, 8, 10 years and sometimes, in perpetuity, says Karun Marwah, Director & Head, International Business, MOFSL. Excerpts from an interview with ETNOW. We are talking about the recession fears from overseas. Things at home with corporate India are really demanding some fresh stimulus and it is playing out in the markets quite adversely. What are you advising clients to do at the current juncture?Look, it is like I had mentioned earlier on your show as well. You know your foreigner investors are not really one bucket. Your style of investing and mine would be different. There is frothy capital which is momentum-based, which could be passing capital needing to go index-led. But you also have long-term pull of capital. What we are advising a few clients is that you are getting markets at a fairly deep discount compared to the highs of Jan 2018. Yes, you do have … [Read more...] about Foreign investors find our market environments quite interesting: Karun Marwah, MOFSL

By Bloomberg News China and the U.S. have reached consensus on many “crucial” issues including a commitment to observe market-oriented exchange rate mechanisms, People’s Bank of China Governor Yi Gang said. The two sides agree to abide by previous commitments made by Group of 20 nations including to not engage in competitive depreciation, Yi said during a press conference in Beijing Sunday during the annual National People’s Congress. The governments will respect the autonomy of each other’s monetary-policy, he added. The issue of currency manipulation has become part of the ongoing talks to solve their trade confrontation, with the U.S. pushing for a pledge by China to not devalue its currency as a way to gain competitiveness or offset the effect of tariffs. China has said that any deal to end the trade spat should be “ two way, fair and equal.” The PBOC has “basically exited” daily intervention in the foreign exchange market, … [Read more...] about US, China to observe market forces on currencies: PBOC

By Livia Yap and Yuling Yang Expectations that $200 billion of foreign money would flow into China’s capital markets this year are looking nothing short of optimistic. For overseas investors, a weaker currency is the latest factor making yuan-denominated assets less attractive. They’ve been selling mainland-listed stocks at a record pace and their demand for Chinese bonds has been relatively tepid: monthly inflows have averaged at just 6.8 billion yuan ($984 million) this year, versus the 44.4 billion yuan seen in 2018, ChinaBond data show. What had started as a promising year in China’s markets is quickly turning sour as the country’s trade stand-off with the U.S. takes a toll on sentiment. The swift correction in stocks and concern that the yuan could tumble to dangerous levels is creating volatility in a market that -- for foreign investors -- remains difficult to hedge. It comes at a sensitive time for policy makers, who have been accelerating efforts to … [Read more...] about Yuan slump derails big year of foreign buying in China’s markets

By Ruth Carson Haven assets are rallying in Asia as US-China trade tensions take a turn for the worse, ending weeks of optimism that a deal between the two countries was close enough to touch. Developed-nation bonds in the region extended recent gains Wednesday, with yields on 10-year Treasuries sinking almost 20 basis points in the past two weeks. Australia’s have fallen even more. The Aussie dollar, a proxy to China’s economy due to the two nations’ close trade ties, has dropped versus all its Group-of-10 peers in November, while stocks have fallen from recent highs. “Markets have been guilty for around 20 months of underestimating the risks of a trade deal being done at all,” said Stephen Miller, an adviser in Sydney at GSFM, a unit of Canada’s CI Financial Group. “Whether it’s Treasuries or stocks or currencies, investors are now repositioning their bets in case we see political dysfunctions persist and reach a tipping point that … [Read more...] about Markets are flashing signs that trade is back on top of risk radar

Gold prices firmed on Wednesday as trade and political tensions ratcheted up between United States and China, while investors awaited minutes from the US Federal Reserve's October meeting. Spot gold rose 0.2 per cent to $1,475.63 per ounce by 0742 GMT. US gold futures were unchanged at $1,474.00 per ounce. US President Donald Trump on Tuesday threatened to raise tariffs on Chinese imports if no deal is reached with Beijing. The US Senate passed a bill backing human rights in Hong Kong and passed a second legislation to ban export of certain munitions to Hong Kong police forces. China condemned the moves and summoned an US embassy official to demand that the US stop its meddling. "There are concerns that the latest bill passed in the US in support of the Hong Kong protesters might derail the progress in the US-China trade deal," Ilya Spivak, a senior currency strategist at DailyFx said. However, gains in gold are limited as investors are "not quite prepared to take a firm bet ahead … [Read more...] about Gold gains on US-China tensions; markets eye Fed minutes