Russian ruble with difficulty restraining the onslaught of the sellers on Thursday – the last trading day of last week. But on Monday it became clear that traders are unnecessarily overcautious, selling the ruble. The Russian currency managed to recapture some of their losses Thursday, despite the development pressure on the world financial markets.
Right now in the markets, perhaps, the main question is, are we seeing a corrective pullback or the beginning of a new wave of decline. Fundamentally we still hold a wary eye on the economy and expect the same from markets. Stock indexes jumped higher than his head thanks to the support of Central banks. However, important was and other signals.
the Collapse in March-April are largely redeemed by retail investors. Stock exchanges and brokers USA and Russia have noted an unprecedented increase in the number of customers and the purchase of depreciating stock. Over the years the rally of the markets and the unprecedented actions of Central banks it has become apparent that the drawdown profitable to buy. Can be said to have formed a reflex relative to what the markets will rise forever, and collapses – this is the best way to buy the market cheaper. This is a dangerous misconception often covers the retail investors just near market peaks. Fundamentally, you cannot shrug off the rising unemployment, wary of costs, the collapse of earnings and dividends in the companies.
After declines in March, we saw a very serious rebound of currencies of developing countries. For example, the ruble has gained 17% to the lows of the same March. Many stock indices have played a significant part of the losses, as some stocks did new highs. Bad news from Beijing and cautious tone of the fed was enough for the markets began profit-taking. What we see now, while hardly a storm, but rather a return to reality after the excessive optimism of markets, which mostly was based on very optimistic expectations.
For the markets and the ruble is going to result in painfully long downward trend. That is the worst combination for the markets. We’ve already seen a record rate of collapse of the markets in February and March turn out the same record pace recovery. A long and painful sideways in the background eating away investors and their capital promises to be the worst advertising markets in years to turn away investors from these assets.
