U.S. Treasury yields tend to rise, so that global funds in a state of panic. A large amount of hot money from the ultra-high valuation of technology stocks outflow, although some of the inflow of old economic stocks to speculate on the concept of recovery, but it seems that more is the choice of “cut grass green”, sell goods out of the market, so see the market situation is a wave lower than a wave. The most fear is that technology stocks adjusted out of control, bursting the stock market super bubble, so that after the Epidemic economic recovery has become more difficult, more alert to the risk of stagflation is quietly coming!
Is the trigger for the global technology stocks plunge, mainly because the U.S. Treasury yield from the low back up, meaning that the market is expected to start with the new crown vaccination around, and the United States will launch a large stimulus measures, the economy will rebound significantly, or prompt major central banks to exit early, in anticipation of tightening monetary policy, lenders choose to take profits out of the market, ultra-high valuation of technology stocks become ” Withdrawal machine”. Looking at Hong Kong stocks alone, the four heavyweight blue chip technology stocks ATMX – Alibaba, Tencent, Meituan and Xiaomi, have fallen from 17 to 37% from this year’s high, during which the market value evaporated more than 3.5 trillion yuan, more than the gross domestic product (GDP) of Hong Kong last year, it can be seen that this is a non-general “water ebb”!
In fact, the recent mainland stock market is also under pressure, the southbound “North Water” also to sell goods to cash mainly, favorable investment trend of Hong Kong stocks has reversed. The two stock markets continue to adjust, a large amount of wealth was evaporated, if the decline is further intensified, not only the financial market hurt the vitality, but also is bound to combat consumer sentiment, which is not conducive to the performance of the internal cycle.
A large amount of money out of the stock market, part of the transfer to the virtual currency market to participate in the crazy party, so that the bitcoin big up and big down; part of the flow to the commodity market, resulting in oil prices up, precious metals also speculation wind; part of the funds still in the stock market, the traditional economic shares to park temporarily to avoid, after all, the rise in debt interest, financial stocks can benefit, coupled with the concept of economic recovery can be speculated, so it becomes a counter-market oddities. However, this is also the big investors to hold the index to sell the usual tricks, when sold almost, even these “odd” are unable to defeat the gravitational attraction, then the full-scale plum market is not far away!
Looking at the first quarter of the global financial market capital shift, out of the stock market, soaring debt rates, stock and bond market anomalies, is often a precursor to extreme volatility in the global financial markets. Looking ahead to the second quarter, the biggest risk is that the economic recovery is not in place, but the central bank water bailout has been exhausted, coupled with the first quarter of global freight, raw materials, chip prices rose sharply, Inflation came back faster than expected, business operations and people’s lives more difficult, the shock of stagflation onslaught should not be underestimated.
Right now, investors must stop to watch the movements of the world’s two major economies, one is if the U.S. debt interest rates continue to rise, will force the Federal Reserve to take action to lower debt rates; the second is the mainland since December last year, the manufacturing purchasing managers index (PMI) has fallen for three months, if the March data continue down, the first signs of stagflation is not only China’s asset selling pressure is not finished, the entire emerging markets will be a disaster, or even weaken the U.S. economic stimulus measures Effectiveness, economic recovery once again failed to become the biggest “black swan” of this year’s global financial markets!
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