Nikkei Soars Looking Past Monetary Normalization
Ultra-loose BoJ policy and the Yen’s demise have been key drivers of the JPN225 mammoth rally. The central bank exited its negative rates regime though and is shifting towards less easy policies, with at least one more hike reasonable within the year. This threatens to cut off a key source of strength for equities and JPN22 registered a brief pullback from the March record peak.
But monetary normalization has been slow so far and the stock market’s strength is based on more factors than just favorable monetary stance and weak currency. Strong earnings, structural reforms and investment-friendly government policies are among them. As a result, JPN225 has resumed its advance and runs its third straight profitable month, trying to set new all-time highs. On the other hand, the RSI reached overbought levels and a pullback here would be reasonable.
Stratos Markets Limited (fxcm.com/uk):
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But monetary normalization has been slow so far and the stock market’s strength is based on more factors than just favorable monetary stance and weak currency. Strong earnings, structural reforms and investment-friendly government policies are among them. As a result, JPN225 has resumed its advance and runs its third straight profitable month, trying to set new all-time highs. On the other hand, the RSI reached overbought levels and a pullback here would be reasonable.
Stratos Markets Limited (fxcm.com/uk):
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Stratos Europe Ltd (trading as “FXCM” or “FXCM EU”), previously FXCM EU Ltd (fxcm.com/eu):
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Stratos Trading Pty. Limited (fxcm.com/au):
Trading FX/CFDs carries significant risks. FXCM AU (AFSL 309763). Please read the Financial Services Guide, Product Disclosure Statement, Target Market Determination and Terms of Business at fxcm.com/au
Stratos Global LLC (fxcm.com/markets):
Losses can exceed deposits.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this video are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed via FXCM`s website:
Stratos Markets Limited clients please see: fxcm.com/uk/market-commentary/
Stratos Europe Ltd clients please see: fxcm.com/eu/market-commentary/
Stratos Trading Pty. Limited clients please see: fxcm.com/au/market-commentary/
Stratos Global LLC clients please see: fxcm.com/markets/market-commentary/
Past Performance is not an indicator of future results.
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