[LONDON] Inspired by MiFID II, a practice that’s long been commonplace in credit is rapidly gaining traction in equities – and that’s making some investors uneasy.

European stocks are largely positive heading into the close after the Federal Reserve issued an upbeat assessment of the US economy last night.

In the last one month equity markets have fallen by more than 5%. The Sensex is down over 2,000 points, while Nifty over 600 points. Given this downward trend, it is not surprising that high net-worth investors (HNIs) are getting jittery about their equity investments and are switching to fixed income investments.

SK Networks’ acquisition of AJ Rent a Car will be positive, said Samsung Securities on Sept. 27, upgrading the recommendation to a “buy” from a “hold” and raising the target price to 6,300 won (US$5.65) from 5,500 won.

A better and more constructive day all around for Asian equities as most markets reopened (S. Korea still off) for business. With both the Shanghai and Hang Seng opening firmer, a steady trend developed to return 1% for both indices. Remarks overnight from US President Donald Trump failed to assist US trading or external commitment, but core Asian equities tended to ignore this in favour of a recovery bounce. The Nikkei made headway after a morning rout, rallying over +0.4% by the close whilst the Yen played in the low 113’s. Shanghai and HSI were strong all day. The SENSEX saw the opposite price action to the Nikkei. Having open at the days highs, the balance of the time was spent hitting bids. It did manage a small bounce by the close but still lost -0.35% on the day. The INR is struggling to resist the 73 figure, but this does not look like it can survive for much longer. Expecting the Rupee to continue its weak trend unless some positive constructive action is taken to alleviate the issues. Obviously, the big FED news is too late for the cash markets, but futures are responding well with the Nikkei up around 1% so far.

The timeline for GC’s processed blood product in gaining approval from the US Food and Drug Administration is likely to be pushed back, said NH Investment and Securities on Sept. 27, downgrading the recommendation to a “hold” from a “buy” and lowering the target price to 220,000 won (US$197.66) from 240,000 won.

In a general wrap-up, analysts at TD Securities explained that North American equities were little changed in a sleepy session ahead of Wednesday’s FOMC meeting (SPX: -0.1%, TSX: -0.2%).

Dollar strengthening slows ahead of Fed meeting

US stock market retreated on Monday ahead of Federal Reserve two-day meeting starting today. Equities fell as US and Chinese reciprocal tariffs took effect – 10% tariffs on $200 billion worth of Chinese goods counterweighed by $60 billion in tariffs on US goods by China. The S&P 500 fell 0.4% to 2919.37. Dow Jones industrial lost 0.7% to 26562.05. The Nasdaqcomposite index however recovered 0.1% to 7993.25. The dollar strengthening slowed with Fed widely expected to hike rates a quarter point and the Chicago Fed’s national activity index came in unchanged in August: live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, added 0.04% to 94.219 and is higher currently. Futures on stock indices indicate higher openings today.

Last year, I wrote about emerging market equities and whether their time had finally come. Should investors be considering an allocation to the asset class, which theoretically offers the promise of higher returns driven off demographic trends? I think it’s a worthwhile topic to revisit, while also providing an overview of investor behaviour since that time.

CPM Group managing partner Jeff Christian says some gold companies – “only a few, but not many”- have shifted focus to the extent necessary to restore investor faith in equities. But generally the gold space was not a massive sectoral play for investors at present, he said on the sidelines of the Denver Gold Forum at Colorado Springs.