Asia markets dive as volatility sweeps globe ahead of Fed meeting

HONG KONG - Asian markets plunged Tuesday following a highly volatile day on Wall Street fuelled by fears about the Federal Reserve's plans to hike interest rates, with attention lasered on its upcoming two-day policy meeting.

A disappointing start to the corporate earnings season, as well as growing concern about Russia's troop build-up on Ukraine's border and warnings of a possible invasion were also dragging on sentiment.

After spending much of last year playing down the spike in prices, the US central bank has in recent months taken a sharp hawkish turn on monetary policy as officials look to bring inflation -- which is at a four-decade high -- under control.

Minutes from the most recent meeting indicate it will begin lifting interest rates from March with three or possibly four more hikes before the end of the year. On top of that, it plans to start offloading its vast bond holdings.

But while the move to battle runaway prices is seen as crucial, the end of the era of ultra-cheap cash for investors has rattled markets after almost two years of uninterrupted gains to record or multi-month highs.

All attention is on the Fed gathering that starts later in the day, with investors poring over every word from the bank's statement and boss Jerome Powell's subsequent news conference.

"The Fed is scrambling to control inflation and markets have gone from expecting a gradual interest rate hiking cycle to an accelerated tightening action until inflation eases," said OANDA's Edward Moya.

"Some economists think the Fed needs a half-point rate increase in March to show they are serious about tackling inflation and signal that more are coming."

He added that officials need to "send a message they are tackling inflation, but they don't need to overcommit themselves. The Fed's best option is to signal they will raise rates by 25 basis points in March and signal another one is coming in May. Inflation may show its peak around then and they may not need to be as aggressive going forward."

Wall Street's three main indexes have had a particularly rough time, with the Nasdaq down more than 10 percent from recent peaks, putting it in correction territory.

And on Monday they saw some wild gyrations, suffering intra-day losses before dip-buying saw them all surge in the last hour to end in positive territory.

London, Paris and Frankfurt tanked Monday, without enjoying any recovery, with eyes on eastern Europe as the United States said 8,500 troops were put on standby for possible deployment to boost NATO as fears grow that Russian President Vladimir Putin is planning to invade Ukraine.

But all three markets rose in opening trade Tuesday.

"Volatility is back," Lori Calvasina, at RBC Capital Markets, told Bloomberg Television. "We're having a sea-change in terms of Fed policy. Equity investors frankly have been behind the curve in anticipating what's coming, so there's a lot of catch-up to do."

Asia spent all Tuesday well in the red with Tokyo down 1.7 percent as Hong Kong shed 1.7 percent, while Singapore, Taipei and Jakarta were also off more than one percent.

Sydney shed 2.5 percent after higher-than-forecast Australian core inflation figures ramped up bets on a rate hike by the country's central bank. 

Shanghai and Seoul fell more than two percent, with Wellington, Mumbai and Bangkok also down.

While there is a general consensus that the long-term outlook for markets remains positive -- thanks to reopenings, vaccination programmes and the less-severe Omicron variant -- many also warn of more near-term upheaval.

Jeremy Siegel, at the Wharton School of the University of Pennsylvania and author of "Stocks for the Long Run", said: "I'm still very positive on long-term equities but I think it's in for a rocky time the next two or three months.

"We have to get used to the fact that the Fed is going to be much more hawkish."

Agence France-Presse

Dow posts best weekly gain since January

NEW YORK - U.S. stocks rose on Friday and the Dow registered its best weekly gain since January, helped by a rise in Intel shares, though trading was subdued ahead of the Federal Reserve's expected reduction of stimulus measures next week.

Despite indications economic growth slowed somewhat in the third quarter, traders expect the Fed to trim its $85 billion in monthly bond purchases by $10 billion while leaving interest-rate policy highly accommodative to help the economy - and be supportive of equities.


The Dow, up 3 percent for the week, has one more week of trading with its current 30 constituents. After that, the average will add Goldman Sachs, Nike and Visa, replacing Alcoa, Bank of America and Hewlett-Packard. Visa rose 7 percent this week.

All three indices got their biggest lift on Friday from Intel, whose shares gained 3.6 percent to $23.44, after Jefferies boosted its rating on the chipmaker and raised its price target to $30 per share.

The S&P 500 rose 2 percent for the week, its best gain in about two months, yet its trading range has narrowed sharply this week and that trend is expected to continue until the Fed announcement. The Nasdaq posted a 1.7 percent gain for the week.

"Next week, the Fed discussion and tapering, and where they land, is big news for the marketplace and, more importantly, how the market interprets what the Fed is either doing or not doing," said Vernon Meyer, chief investment officer of Hartford Funds in Radnor, Pennsylvania.

The Dow Jones industrial average was up 75.42 points, or 0.49 percent, at 15,376.06. The Standard & Poor's 500 Index was up 4.57 points, or 0.27 percent, at 1,687.99. The Nasdaq Composite Index was up 6.22 points, or 0.17 percent, at 3,722.18.

Among other gainers for the day, shares of Safeway jumped 6.1 percent to $28.20 after Credit Suisse upgraded the supermarket operator's stock.

Coal sector shares fell before next week's unveiling by regulators of a carbon emissions-rate standard for new fossil fuel power plants. Alpha Natural Resources dropped 2.4 percent to $6.21, Peabody Energy lost 3.2 percent to $17.98 and Arch Coal fell 3.3 percent to $4.69.

The day's economic data showed retail sales rose for a fifth consecutive month in August, though the increase was smaller than the market expected. U.S. consumer confidence slipped early this month and inflation pressures remained subdued even after an energy-led increase in wholesale prices last month.

Volume was among the lightest of the year for a full day of trading, with less than 5 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, well under the average daily closing volume of about 6.3 billion this year.

Advancers beat decliners on the NYSE by about 1.6 to 1 while on the Nasdaq advancers beat decliners by about 1.5 to 1.

source: interaksyon.com

PSEi climbs back above 6,200-mark on easing investor worry over Syria

MANILA - Philippine share prices on Wednesday stretched their winning streak to a fourth session as investors cheered further signs of easing tension over Syria.

At the Philippine Stock Exchange, the benchmark index was up 125.18 points, or 2.06 percent, to close at 6,214.90. All sectors finished in the green with the property counter leading the charge with a gain of 3.25 percent.

Advancers beat decliners, 94 to 47, while 41 issues were unchanged. A total of 906.84 million stocks worth P9.22 billion changed hands.

Most actively traded stocks were PLDT, Ayala Land, SM Investments, Universal Robina and SM Prime. Top gainers were Vitarich, IMI and iRipple, while the biggest losers were MJCI, 2GO and United Paragon.

"Obama's statement was a big boost to the market. It seems that a diplomatic solution is in the offing which helped calmed nerves of the investors," said Astro del Castillo, managing director at First Grade Finance Inc.

In a televised address on Tuesday night, US President Barack Obama asked Congress to delay a vote on the use of force against Syria as the White House and its allies pursue a diplomatic resolution that would require Syrian President Bashar al-Assad to surrender the chemical weapons.

Overnight, the Dow Jones industrial Average rallied 127.94 points, or 0.9 percent, to 15,191.06.

The prospect of a US-led military strike against Syria has been weighing on the market in the past several weeks.

"This, and improving economic data across the globe, they’re bringing back the confidence of most investors. We're in the last leg of the year so you're seeing more positioning," said del Castillo.

Adding to the euphoria were reassuring economic data that saw China's industrial output and retail sales topping forecasts. Stocks rallied at the start of the week after China reported better-than-expected exports data, adding to signs of the resiliency of the world's second biggest economy.

Fears that the US Federal Reserve may start tapering its stimulus program have been pushed on the sidelines this week.

"The market has digested that news and if the Fed actually reduces its stimulus, the reaction will not be as worse as what we saw in the previous months," said del Castillo.

The Fed will hold its policy meeting on September 17-18 and is expected to provide direction on the future of its economic stimulus. The US central bank's $85-billion bond-buying program – the third tranche of what has come to be called “quantitative easing” (QE3) – has been a key driver of equities rallies in the past several months.

source: interaksyon.com

6 Ways To Teach Your Kids All About Money

Kids are fast learners, and one of the best lessons that we can teach them is money management. However, money management is often hard for many adults to grasp, so how can we teach our kids about money in a way that is engaging?

First, we can realize that there are opportunities to teach children about money every single day. Whether we take them with us into the bank or let them push some buttons at the ATM, they can learn simply by doing. If you are looking for more ideas, check out the 6 below.

1. Talk About It All The Time

I don’t know why (because I’m not shy about it!) but money is a taboo topic. People don’t like talking about their budgets or their debt or what they paid for their house. While I am a private person and I don’t want my future kids to know my salary, I do think that it’s important to talk about money topics. Kids can learn about investing, interest rates, banks, checking accounts, and credit cards at a very young age. Having all of these topics open for discussion will make them comfortable with money. It will also put them way ahead of the curve when it comes time for them to grow their own nest egg.

2. Teach Them To Give

While it’s important to teach children how to save, it’s equally important to teach them how to give. Whether it’s splitting their allowance with a charity of their choice or having them drop change in a donation bucket, you can teach them how lucky they are and how the money they decide to donate can be used to help others.

3. Teach Them To Earn It

Instead of giving your kids an allowance just for being your kids, why not ask them to complete certain chores around the house? This will teach them that money doesn’t drop out the sky. You actually have to work hard in order to get it.

4. Teach Them To Organize It

When kids are young, many parents decide to have two or three piggy banks. You can have one for spending, one for saving, and if you want, one for giving too. That way, every time your child receives money, they can split it between their piggy banks. When they grow older, they can get their own checking and savings accounts.

5. Set An Example

Kids watch absolutely everything we do. I remember telling my mom to “just write a check for it.” However, I had no idea what writing a check meant at the time! Show your kids how you are paying for things. Explain to them different methods. Tell them that you are buying yourself a new dress because you worked hard, and you have money in your bank account because of it. You’d be surprised what they pick up! Kids are sponges!

6. Let Them Play Games

T.Rowe Price has a fun, interactive game called The Great Piggy Bank Adventures where you can “earn money and buy cool stuff.” Kids also learn about investing and saving up for goals through the game, so it’s a great resource!

source: everythingfinanceblog.com

Building Wealth When the Economy is Slow

Just because the economy in our nation is going through a little bit of turmoil, that does not mean that we have to be all doom and gloom about the world. Don't watch the news if you can't stomach the headlines. Why should you get pulled into all the negativity about how our economy is going down the drain? The truth is, there is another side of the issue that we never really hear about: There are people in our economy right now that are getting rich. There are other people who are currently positioning themselves in such a way that they can prosper heavily as soon as the economy begins to swing back into our favor, a growth cycle. There are a wide variety of different ways that you can make this happen, meaning that building wealth is possible even when the economy is down, or slow.

Although it may be rarely discussed in the mainstream media, there are actually good investments out there in this economy of ours. There are always going to be ways for you to invest in such a way that you can earn a solid return, no matter what cycle of the economy we are currently experiencing. There is absolutely no doubt that there are people right now who are in trouble, but not everyone is in trouble, and some people ARE making it big. We are hearing plenty of news about people being laid off, and unemployment numbers climbing, so how can we find out about what investments are still viable in this economy of ours? Here is a hint: Think about things that people need, or think about what people perceive that they actually need. People are still buying cosmetics, and people are still buying alcoholic beverages, for example, even when the economy is down. In other words, you can invest in the things that aren't going away no matter how bad the economy seems to get.

You should also consider investing in companies that will help you save money on things like transportation, energy, food or entertainment. People are always looking for possibilities for stretching their dollars further, especially when it comes to buying things they need, or simply buying the things that they believe that they need.

Before you put your money into the investment ideas mentioned above, keep this in mind: You will do well to invest in these things now, but you would have done better by investing a year ago to two years ago, because then you could be selling your investments at a much higher point than now. You could be taking serious profits on the sales you made, re-investing the profits into the other businesses that are recession proof in nature accordingly. This really is not a difficult concept, so start taking advantage of it today.

source:  richcreditdebtloan.com