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Staying optimistic in a bear market

While 2016 has got off to a rough start and risks remain high in the short term, investors could see their shares doing better this year than last year

Published Fri, Jan 15, 2016 · 09:50 PM

    THE year 2016 started pretty much where 2015 left off with basically the same worries driving another bout of share market falls. Geopolitical concerns have played a role but the main issues are uncertainty regarding the Chinese economy, wariness about the US Fed raising interest rates and the impact of a rising US dollar and falling Chinese renminbi.

    Share markets have seen sharp declines so far this year (with US shares -5.2 per cent, eurozone shares -6.2 per cent, Japanese shares -9.5 per cent, Chinese shares -14.6 per cent and Australian shares -6.8 per cent) taking them back to around the lows seen during the second half of last year. Commodity prices are down further with the oil price falling to its lowest since 2009 and bonds have rallied with safe haven buying. This article looks at the key issues.

    Drivers behind the recent falls could linger for a while

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