A new corrective week for the European indices, with -1.2% for the stoxx600NR which widens further the gap with the S & P500 which remains stable boosted by the adoption by the House of Representatives of the text on the tax reform promised by Donald Trump. Good results from Wal-Mart and Cisco also came in support.
Dividend Aristocrats (ETF ProShares NOBL) : take advantage of Flight to Quality (weekly data)
This trend is supported by the evolution of the Euro / USD up to 1.18, however the tax plan of D. Trump must now be ratified by the Senate. The dollar's weakness is partly explained by new revelations about members of Donald Trump's campaign team suspected of colluding with Russia.
Negotiations on the coalition in Germany between Angela Merkel's party, liberals and environmentalists have still not been completed and could continue over the weekend. If an agreement was not found, early elections would be held.
The week was characterized by profit taking on oil, which fell by 1% over the week despite a weekend rebound related to the reassuring remarks of Saudi Arabia on its willingness to extend the OPEC agreement, which offset the decrease of geopolitical fears with the imminent arrival in Lebanon of the resigned president of Lebanon Hariri, which could help to calm a very tense situation. In addition, the production of shale oil was very strong in the 3rd quarter and the rise in the price of crude does not seem sustainable in the absence of the geopolitical risk premium.
Rates were relatively stable this week, in most sub-segments including the high-yielding segment which is stabilizing. Commodities are also within a correction phase on major metals such as copper, nickel or steel.
The week was marked mainly by the return of risk aversion and volatility on securities more than on indices. The steep fall of Altice, an LBO specializing in telecoms and in debt of 50 billion € is the symptom. Valuations are now demanding and the slightest disappointment is punished very severely. The CAC40 posted 8 consecutive drop sessions, which had not happened for a long time, a sign that the market is becoming more selective and demanding. Gold performed well this week, which also shows that distrust is not far off. However, the markets have not yet changed, as the volatility of the indices remains very low and there is no visible changeover in government bonds. So what seems like a lot of nervousness comes down to a "flight to quality" inside the stock market, which favors the USA first and then the most qualitative companies.
Good performance of US Growth Stocks (ETF iShares Russel 2000 Growth : IWO), weekly data
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A new corrective week for the European indices, with -1.2% for the stoxx600NR which widens further the gap with the S & P500 which remains stable boosted by the adoption by the House of Representatives of the text on the tax reform promised by Donald Trump. Good results from Wal-Mart and Cisco also came in support.
Dividend Aristocrats (ETF ProShares NOBL) : take advantage of Flight to Quality (weekly data)
This trend is supported by the evolution of the Euro / USD up to 1.18, however the tax plan of D. Trump must now be ratified by the Senate. The dollar's weakness is partly explained by new revelations about members of Donald Trump's campaign team suspected of colluding with Russia.
Negotiations on the coalition in Germany between Angela Merkel's party, liberals and environmentalists have still not been completed and could continue over the weekend. If an agreement was not found, early elections would be held.
The week was characterized by profit taking on oil, which fell by 1% over the week despite a weekend rebound related to the reassuring remarks of Saudi Arabia on its willingness to extend the OPEC agreement, which offset the decrease of geopolitical fears with the imminent arrival in Lebanon of the resigned president of Lebanon Hariri, which could help to calm a very tense situation. In addition, the production of shale oil was very strong in the 3rd quarter and the rise in the price of crude does not seem sustainable in the absence of the geopolitical risk premium.
Rates were relatively stable this week, in most sub-segments including the high-yielding segment which is stabilizing. Commodities are also within a correction phase on major metals such as copper, nickel or steel.
The week was marked mainly by the return of risk aversion and volatility on securities more than on indices. The steep fall of Altice, an LBO specializing in telecoms and in debt of 50 billion € is the symptom. Valuations are now demanding and the slightest disappointment is punished very severely. The CAC40 posted 8 consecutive drop sessions, which had not happened for a long time, a sign that the market is becoming more selective and demanding. Gold performed well this week, which also shows that distrust is not far off. However, the markets have not yet changed, as the volatility of the indices remains very low and there is no visible changeover in government bonds. So what seems like a lot of nervousness comes down to a "flight to quality" inside the stock market, which favors the USA first and then the most qualitative companies.
Good performance of US Growth Stocks (ETF iShares Russel 2000 Growth : IWO), weekly data