Tsvetoslav Tsachev, chief investment consultant ELANA Trading, “Investor Club”, 28.10.2023
21:30 | October 28, 2023
Updated: 08:38 | October 29, 2023
Author: Daniel Nikolov
Despite the subdued expectations, the market remained underwhelmed by reports from major tech giants amid expectations of strong earnings forecasts for the sector next quarter. Meta cut advertising revenue forecasts for the fourth quarter on the back of very strong results for the third. Alphabet also did not please investors, seeing the same trend of slowdown and less strong growth. Shares in Mercedes fell amid losses and laggards in the electrification of Europe’s auto sector. This was commented by Tsvetoslav Tsachev, chief investment consultant of ELANA Trading, in the program “Investor Club” with presenter Ivaylo Lakov.
“Investors are nervous. There is a mix of news that is mixed, outside of geopolitical risks around the Middle East and oil supplies.” There are concerns about how high interest rates and rising bond yields will affect the financial system “and not so much for the banking system as for all other private forms of financing where capital is available for a certain time,” said Tsachev. “Concerns are emerging around asset quality.”
I expect there to be a pre-Christmas rally in the markets because of the strong liquidity and the high yield (above 5%) of the ten-year US bond yield, said Tsachev. Such levels are reminiscent of the peak of the credit cycle before the 2008 financial crisis, so “the real bad news is already in the market,” he added.
Oil can go above 100 dollars per barrel only if there are problems with supplies, but the intensified diplomacy shows that none of the major players – the Arab countries, the United States and Europe – want an additional escalation of the crisis in the Middle East, Tsachev believes. Saudi Arabia knows it cannot have the same oil crisis as 1983 because the US is protected by its shale production. The risk premium since the beginning of the crisis on October 7 with the Hamas attack on Israel has already been wiped out.
“No one would want to get to a stage where the global economy is thrown into terrible inflation plus a severe economic collapse.”
Gold is rising in price as the strongest indicator of unreflected risks and nervousness in the market, said Tsachev.
What are suitable investments at the moment you can watch in the video.
The conversation is not a prerequisite for making an investment decision.
All the guests of the show “Investor Club” can be found here.
2023-10-28 18:30:00
#Tsachev #bad #news #market #preChristmas #rally
