In-depth: Global stocks
- 5 years ago
증시 대담
Now it's time to look at the stock market action today in Korea... and around the world.
And for that we're joined by Daniel Yoo, global strategist at Kiwoom Securities.
Thanks Mr. Yoo for your time this afternoon.
You're welcome.
So, U.S. stocks backtracked on Wednesday, down around a tenth of a percent. Seems like investors are still factoring in the risk of a recession and a related factor to that, the yield curve, which is still upside down.
Yes, the inversion in the yield curve continues as U.S. government bond yields continue to decline.
The benchmark U.S. 10-Year yield is currently about 2.40%. To be more specific, short-term rates (US 3-Month rate: 2.44, US 6-Month rate: 2.47) are now above the 10-year yield.
However, the most important thing to look at is the difference between 2-year yields and 10-year yields, and now the difference is still indicating 13 bps. During the dot-com bubble period, the difference between 2-year yields and 10-year yields was maintained by 0% for such a long time, the NASDAQ index also soared more than 200%.
Also, as the current loan-deposit ratio is lower than the dot-com bubble period and is at 77.4% which is very low, recession is unlikely anytime soon.
There was weakness also Wednesday in the main European markets. What's affecting Europe, and and where does Brexit fit into that?
European market in general had a sovereign debt crisis in 2011. Since then, it has been trying to solve the non-performing assets problem for the last 9 years. However, the Zone is not writing down the NPLs, so the problem-solving process is long-term. This is the reason for the long-term Brexit issue.
However, because of high level of provisions for the non-performing assets of Europe, the European economy will not fall into recession anytime soon.
What has been the effect of these movements in Europe and America on Korean stocks?
Korea's stock market as well as other markets in the Asia have been affected by the declines of the New York and Europe stock markets.
For now, as the trade war between the U.S. and China is ongoing, global stock markets are highly affected by the delay of an agreement between the two countries.
However, valuations on the global market are cheap at the current level. Therefore any correction will be limited as well.
Okay Mr. Yoo. That's where we'll have to leave it today.
Thanks for making time this afternoon.
Now it's time to look at the stock market action today in Korea... and around the world.
And for that we're joined by Daniel Yoo, global strategist at Kiwoom Securities.
Thanks Mr. Yoo for your time this afternoon.
You're welcome.
So, U.S. stocks backtracked on Wednesday, down around a tenth of a percent. Seems like investors are still factoring in the risk of a recession and a related factor to that, the yield curve, which is still upside down.
Yes, the inversion in the yield curve continues as U.S. government bond yields continue to decline.
The benchmark U.S. 10-Year yield is currently about 2.40%. To be more specific, short-term rates (US 3-Month rate: 2.44, US 6-Month rate: 2.47) are now above the 10-year yield.
However, the most important thing to look at is the difference between 2-year yields and 10-year yields, and now the difference is still indicating 13 bps. During the dot-com bubble period, the difference between 2-year yields and 10-year yields was maintained by 0% for such a long time, the NASDAQ index also soared more than 200%.
Also, as the current loan-deposit ratio is lower than the dot-com bubble period and is at 77.4% which is very low, recession is unlikely anytime soon.
There was weakness also Wednesday in the main European markets. What's affecting Europe, and and where does Brexit fit into that?
European market in general had a sovereign debt crisis in 2011. Since then, it has been trying to solve the non-performing assets problem for the last 9 years. However, the Zone is not writing down the NPLs, so the problem-solving process is long-term. This is the reason for the long-term Brexit issue.
However, because of high level of provisions for the non-performing assets of Europe, the European economy will not fall into recession anytime soon.
What has been the effect of these movements in Europe and America on Korean stocks?
Korea's stock market as well as other markets in the Asia have been affected by the declines of the New York and Europe stock markets.
For now, as the trade war between the U.S. and China is ongoing, global stock markets are highly affected by the delay of an agreement between the two countries.
However, valuations on the global market are cheap at the current level. Therefore any correction will be limited as well.
Okay Mr. Yoo. That's where we'll have to leave it today.
Thanks for making time this afternoon.