Nick Batsford, CEO of Tip TV, was joined by Richard Hunter, Head of Equities at Hargreaves Lansdown (LONDON:HRGV), on the 28th September 2015 to discuss QE mark 4, the FTSE 100, the major UK supermarkets, plus Gold, the Dow Jones and Spain’s election.
More QE on the cards
Hunter outlined how in the current market conditions, QE mark 4 could be more likely than an interest rate hike. With Draghi and Europe already preparing for another wave of QE, could the US be on the end of a further wave as well?
Only 30% bullish on the FTSE 100
Batsford highlighted the StockTwits Sentiment, which saw only 30% bullish on the FTSE 100 despite the index remaining above 6000. Hunter noted the concerns over China as a possible cause, but also added that the US is strong and many FTSE 100 companies trade with the US, meaning there are still plenty of buying opportunities within the FTSE.
Supermarkets reporting season over next few weeks
With both Tesco (LONDON:TSCO) and Sainsbury’s reporting soon, Hunter commented that the latter being 18% down over the last quarter, and facing a battle of increases in volume versus the food price deflation.
Gold – Dow Jones comparison: More evidence of stocks moving lower
Batsford outlined FX Street, who believed that Gold have priced in deflation – while stocks are yet to do so. The gold decline from USD 1920.74 (Sep 2011) to USD 1073/Oz (July 2015) represents the failure of the QE led hyperinflation theory. He continued that stocks are hyper inflated from QE, and are now about to price in deflation. He finished by expressing how Gold could strengthen on hedge demand as stocks move lower and appear attractive in Asian currency terms.
Spain’s Sunday election
Batsford commented on Elliott, who believed that Sunday’s election to the regional parliament saw a good turnout with the pro-independence party (Junts pel Si) gaining 40% of the vote giving it 62 seats in the 135 seat parliament (a majority).
Watch the video to see the general view of the market, as well as outlooks on HOME, EasyJet and Sainsbury’s.