So yesterday, I was wrong about market movement this week because it rose strongly yesterday. Today, it is in slight retreat after the release of good economic data, which is the behavior I predicted the day before yesterday. Yesterday wrong, today right, tomorrow? Sheesh ….
China is a magnet now for investment in Asia. Ya might want to consider moving money into this region and into the companies that move on Asian growth.
- Raw-material shares and industrial companies gained the most today among the 10 groups on the MSCI Asia Pacific Index.
Speaking of China, all the talk about China as a currency manipulator has stirred the pot on China’s money management approach, which is odd since The US Federal Reserve regularly manipulates the US dollar for economic purposes. Nevertheless, it has been in China’s US relationship interests to have the yuan appreciate some 11% in the last year or so. The question is: will it continue to do so after the election?
- The yuan is likely to retreat once the U.S. election is over, as political pressure for appreciation will abate.
This does not seem likely, as China is actively pursuing policies to curb exports and to turn China into a more domestic consumption economy. Speaking of the Chinese economy, another reason to consider moving money into Asia is the following.
- A once-a-decade leadership transition in China, which will start on Nov. 8, is fueling bets for more stimulus in the world’s second-largest economy.
Turning an eye back to the US, the positive data referenced earlier suggests US consumers are truly happier as another survey points to a rise in consumer confidence. As well, US retailers are reporting stronger than expected sales in October. Have you been playing the retailers?
- Data from the retailers themselves confirms the improved sentiment. October is typically a breather month for spending, falling in between back-to-school and the holiday shopping seasons. Same-store sales, excluding Wal-Mart rose 4.7% in October versus estimates of 4.3%, with luxury and discount stores posting stronger gains.
Apparently, when consumers are happy, they drink more coffee, or maybe it is that more people frequent the malls when consuming and since Starbucks is ubiquitous in areas of high traffic, the following is understandable. Nonetheless, it is good news for the US economy that folks will spend upwards of $3 for a cup of coffee, well, special coffee, ya know with whipped cream.
- Starbucks raised its profit forecast for the current fiscal year after sales in its top market of the United States topped expectations.
Finally, as if market opportunity is not everywhere around us, take a look at the transportation sector, if you want your money to work that is.
- Orders for transportation equipment surged 31.3 percent in September.
Trade in the day; Invest in your life …
