Japanese and Chinese peoplestock It rose more than 2% this morning, leading the entire Asia-Pacific region.
Bitcoin It rose 2% to $34,216 in the past 24 hours, reversing some recent losses.
On Friday, the Central Bank of China decided to allow banks to reduce reserves to pay for their funds, which boosted sentiment in Asian markets. Borrow. This move should effectively increase the loans they provide to companies and households.
Analysts said that this move should release approximately US$154 billion to the Chinese economy like a rate cut.
The move boosted the mood in the region, which is being hit by a new wave of new coronavirus infections. Today, Tokyo has entered a new state of emergency due to the pandemic. With the increase in cases, Seoul is also preparing to accept new restrictions.
China’s GDP data released later this week will give investors a deeper understanding of how to trade in the region. Experts predict that as China recovers from the pandemic, the economy will grow by 8% in the second quarter compared to a year ago. The GDP in the last quarter increased by 18.3%.
However, the London stock market is expected to decline as investors this week began to feel uneasy about the threat of inflation and the Bank of England’s possible need to curb inflation.
Most people believe that the current price increase is only a temporary phenomenon caused by one-off factors, such as the global shortage of microchips and the surge in demand for shopping and going out as the United Kingdom withdraws from the lockdown.
Others believe that many factors such as labor shortages and the red tape of Brexit will continue to exist and will intensify as the economy further opens up on “Freedom Day” on July 19.
On Wednesday, the UK National Bureau of Statistics released the UK Consumer Price Index, which is expected to increase by 2.2% in June from 2.1% in May. The May data is much higher than the city’s forecast of 1.8%-a reminder that this week’s CPI data may contain some shocks.
The Bank of England had predicted that inflation might exceed 3%, but it would fall back later.
The debate on this point will be fierce, but today’s decline in oil prices has weakened some of the brilliance of the FTSE 100 index, which is dominated by oil companies.
According to the futures market, the stock price will fall by 21.5 points to 7,095 points.
Liberum’s brokers are a minority, and they expect inflation to remain “higher and longer” and will only fall sometime next year. Therefore, in a report to customers today, it recommends sticking to “quality” rather than “value” stocks, which means choosing stocks with higher profit margins and higher overall profits.
It suggests that this means British fashion and retail, industry and technology.
In addition, Liberum stated that its climate portfolio of green stocks in the FTSE 350 Index continues to outperform the broader market, despite a decline in the past month.
As the company prepares to announce its second-quarter profit, investors are ready for strong earnings, but stockbroker Jefferies said today that it believes they are not optimistic enough.
It said that as the pace of vaccine launches accelerates, the recovery in Western Europe and North America will be strong, although it acknowledges Israel’s recent concerns about the efficacy of vaccines against new variants. It also noted from Google’s mobile data that as the blockade eases, emerging markets are showing more people moving around—a sign of improving economic activity.
