Investment Newsletter October 2014
Trick or Treat? By Neal Foundly Investment Analyst
The markets are spooked and it isn’t even Halloween yet. What’s causing fear to rise?
human suffering. We agree there is a pressing need for international action to assist the health systems in Western Africa and implement preventative measures to restrict proliferation.
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Concerns over economic growth. Recent economic data has been patchy and the International Monetary Fund (IMF) recently lowered its forecasts for global growth from 4.0% it forecast in July to 3.8% today.
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A glut of oil reflecting weak industrial demand. The oversupply has weakened oil prices which may indicate that the pace of manufacturing and energy demand is faltering.
Sure, lower economic growth is not welcome but it is not necessarily a negative signal for the markets. The IMF downgrades to economic growth forecasts were focused largely on the Euro Area and Latin America, both of which have been sluggish for some time.
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The spread of Ebola virus disease that has resulted in over 4,000 deaths in West Africa and isolated cases in Europe and the United States.
Conversely, the IMF upgraded its expectations for US growth. Overall, the Fund is expecting the rate of global growth to rise from 3.3% this year to 3.8% in 2015.
Each of these spectres are menacing in their own way. The Ebola virus is by far the most serious in terms of
The remaining two economic shadows, however, can be an illusion.
European growth does look fragile. However, there still remains the possibility that the European Central Bank
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