BOJ EFFECT ....... 16:07, Friday 31-10-2014 Its been turning. Fed finished printing, so Kuroda apparently felt obliged to take the baton and extension program surprised markets with 60-70 trillion yen to 80. The response is obvious: a large restatement of the yen and the surge in stock prices. The question of how these reactions are justified. Discount yen seems indisputable. The truth is, its hard to argue with the fact that eg. The dollar is expected to cost 115 or 120 yen. Of course there are some limits set at least competitive (Japan vs. China, Germany and other big exporters), but we do not think we have them tested, and the market over this at all does wonders. Longi at UJ is a game for the brave, but the games potential. Nikkei reacted very strong growth and it is also not without foundation. Inflation in Japan - if you can grow it, will increase the profits of companies, weak yen increases the competitiveness of exports, and the government will be by the BoJ and pension fund aggressively buy stocks. It is possible, therefore, that the Nikkei will still grow. All current correction in the trend were completed in the style of V and so it was this time. 3 of 4 recent times the market has not been able to grow significantly above previous highs. The recent expansion is 130% correct, at this time would indicate the level of 2070 points. What a euphoric reaction to the S & P500 have been more mixed feelings. How greater expansion of BoJ is to help Wall Street? River of Japanese money rather not flow in the direction of the US, the profits of Japan will in turn be worth less in terms of dollars. It is simply a spark thrown on fertile ground firmly reflective of US indexes, which we think will be crucial corporate earnings. Season Q3 looks solid, because the index may continue to increase, the potential in our opinion, is not large. We believe that customers should either seek short positions in the range of 2050-2100, or buy shares adjustments, the fact that - as shown by the latest revision, catching the holes may be more difficult.
Posted on: Fri, 31 Oct 2014 15:11:50 +0000
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