Asia ex Japan equities finished sharply lower with the MSCI Asia ex Japan Index contracting 7.6% in USD terms month-on-month (MoM), behind MSCI AC World Index.
2-year and 10-year US Treasuries (USTs) yields ended the month lower, at 0.78% and 1.92%. Concerns that China could be embarking on a devaluation path curbed investors' risk appetite and supported demand safe-haven assets.
This policy change by the BOJ is a positive in terms of maintaining and strengthening the inflation expectations that have begun to flower.
Unfortunately for the soundness of the sleep among BOJ-watchers, Mr. Kuroda believes that surprising the market is the best way to achieve his intended result.
Our London and US analysts review oil prices from the supply and demand angle and they note that global demand growth remains high while global supply is narrowing, indicating that oilfs price swoon could be over.
Our Singapore Multi-Asset and Equity team analysts cover oil’s swoon using a bit of humor, but the clear-cut conclusion is of great importance.
Our Chief Global Strategist regards Japan positively in the global-macro context and predicts that Japanese equities will outperform global equities in the first half of 2016.
Our Chief Investment Officer in Japan details the many reasons for optimism on Japanese equities in 2016
Our Singapore fixed income team expounds on the outlook for this clearly globally important factor.
The current depreciation trend of the RMB against USD should be seen as a broad-based depreciation of the RMB and not bilaterally to the USD.
2015 has been a tumultuous year with a plethora of risk events spurring significant volatility across most asset classes.
In early 2016, hedge fund Nevsky Capital decided to call it quits after 15 years of successful asset management. One of the reasons for the closure is that since the global financial crisis (GFC), emerging markets (EMs) are breaking away from the transparent 'Washington Concensus' model and are now prone to much less predictible nationalistic policies.
In USD terms, the MSCI AC Asia ex Japan Index finished 0.5% lower for the month, while the MSCI AC World Index closed 1.8% weaker.
2-year and 10-year US Treasuries (USTs) yields ended 2015 higher at 1.05% and 2.27%. These come after the US central bank raised ist interest rates and pledged a gradual pace of increases.
There are many concerns about Abenomics losing its power to reform the economy, but our Chief Strategist in Japan, Naoki Kamiyama, shows that the major developments in tax reform prove that Abenomics is alive and well.
James Eginton provides his insights on the economic transition in China following a recent research trip to the region. The transition from a reliance on infrastructure investment to consumer spending - perhaps the largest the world will ever see - has significant implications for global growth.
John Vail reflects on the Fed decision and the path forward. The Fed was even more dovish than apparent in the headlines.
Nikko Asset Management's Global Investment Committee met on December 8th and updated our intermediate-term house view on the global economic backdrop, central bank policies, financial markets and investment strategy advice.
We only expect mild further easing ahead, especially as the ECB does not wish to cause a rupture while the Fed is hiking rates.
We forecast that Asia Pac ex Japan, Japan and Europe will outperform in the next six months, while the US should underperform and, thus, deserve an underweight stance vs. all other regions.
Our investment management teams have again come together to update their views given new developments in India.
US Treasuries (USTs) yields ended the month higher. October non-farm payrolls indicated a surge in job growth, keeping the US Federal Reserve (Fed) on course for a possible rate hike in December.
The MSCI Asia ex Japan Index fell 3.4% in USD terms, underperforming MSCI AC World Index. Malaysia, being the only net commodity exporting country within the Asia ex Japan region, was the only market which proved positive returns (in USD terms) in November, aided by strong currency.
Looking forward, even though inventories were revised higher, their long depletion means they remain far too low in my view, and should continue start to rise significantly in the quarters and years ahead.
As we enter 2016, we believe the divergent monetary policy theme will continue -- with the major risk to global bond markets and Fed rate rises continuing to be Europe.
A framework agreement for the Trans-Pacific Partnership was reached in October 2015, and the governments of participant countries are working to ratify the agreement and formally launch the partnership.
With the aim of significantly liberalizing trade within the Asia-Pacific region, and thereby boosting trade and investment among the region's countries, a framework agreement for the Trans-Pacific Partnership (TPP) was reached in 2015.
Inbound consumption by overseas visitors to Japan continues to grow. For the nine-month period from January to September 2015, such consumption totalled a cumulative ¥2.6 trillion (approx. US$21.7 billion), which already represents a higher amount than that for all of 2014.
The IMF's decision to include the Renminbi into the SDR is a major push for the RMB to become one of the world's major reserve currencies.
Our lead Australian fixed income portfolio manager discusses her intermediate-term outlook for the bond market “down under.”
Once again, as has long been our view, disappointing macro-data should not worry investors in Japanese risk assets very much at all.
Prices of the US Treasuries (USTs) ended the month lower. Risk-on sentiment prevailed for the most part of October, favouring risk assets over perceived "safe-haven" instruments.
The MSCI AC Asia ex Japan Index rose 8.0% in USD terms, broadly in line with MSCI AC World Index. All Asia ex Japan currencies except the Philippine Peso strengthened against the US dollar in October.
Developed and emerging markets in Asia ex-Japan have clearly been under tremendous pressure in recent months, including redemptions of more than USD 50bn from the region in September, the heaviest ever witnessed.
We update our views on whether ECB QE has had a positive effect on corporate earnings.
There are many reasons for the BOJ to defy consensus expectations for more easing.
US Treasuries (USTs) registered gains in September. Yields initially trade in a tight range, but subsequently jumped mid-month, in anticipation of the announcement from the US Federal Reserve (Fed).
The MSCI AC Asia ex Japan Index was down 1.8% in USD terms in September which masked the volatility where the markets oscillated within a wide range of 10%.
There is an admirable effort to improve the female participation rate, but it is too early to judge whether the measures will have a major effect.
A better supply/demand balance in Europe, outperformance of “high yield“ globally, positive event-risk in the telecom sector and opportunities in local currencies, as well as other credit related investment themes, all present interesting opportunities for generating positive returns, even in a challenging environment.
Our Nikko Asset Management fixed income experts, led by Simon Down, discuss the prospects for commodity currencies.
In our view, the G-3 economies will fare reasonably well, and basically match the current consensus in the next few quarters; however, there will be significant challenges for each region.
For the time being, we are not estimating a date for reducing the Fed’s balance sheet, but a 2Q16 initiation seems quite logical at this stage.
Although we expected G-3 bond yields to rise, they did so less than we predicted in our June meeting. We expect yields to rise moderately further for the next two quarters.
Our forecasted macro-backdrop scenario has mixed ramifications for global equities, with the US declining but most other regions rising, and it is likely to be very volatile ride
Markets and economies are still being dictated to by unprecedented levels of monetary stimulus. We believe in building a portfolio of companies that are more likely to flourish in the growth environment beyond 2015.
US Treasury (UST) yield curve, along with other asset classes, experienced volatile swings in August. The Chinese central bank’s announcement that it would modify the approach to setting the CNY fixing midpoint effectively weakened the currency against the USD.
Asian equities fell 9.8%, underperforming the MSCI AC World Index by 3.2%, in USD terms. This marked the worst monthly performance for MSCI Asia ex-Japan Index since May 2012.
Looking at how Japanese companies fared with their April-June quarterly earnings, we can see that automobile manufacturers and major electronics producers posted large profit growth on the back of the weak yen and strong sales in the North American market.
We explain how Abenomics is the "icing on the cake" of corporate governance improvement over the last decade.