US corporate profits have been inflated by stock appreciation, reduced overreporting of depreciation and government subsidies. The consensus forecast for S&P 500 earnings may understate the coming drag as these temporary influences fade.
Even as they increase regulatory oversight of the tech sector, Chinese authorities still value the role played by private sector companies in digitising the country’s economy, research analyst Adam Wolfman explains.
The retail prices index is giving a more worrying message about inflationary pressures because it incorporates house prices and has been less affected by changes in basket weights, argues Simon Ward, Economic Adviser.
Portfolio manager Denny Fish sees the current tech rally being guided by earnings results and acknowledgment of the strong positions of leading tech and Internet companies aligned with the themes of the cloud, e-commerce and artificial intelligence.
Q3 monetary data will be key for assessing whether a likely near-term global industrial slowdown represents a temporary pause of the beginning of a larger downswing, argues Simon Ward, Economic Adviser.