The Trade Tensions Rise | Flow Traders Investment Competition | Week 14

Another unexciting week in 2019, on average there was barely any change in the Dow Jones last week. The average increase was 0.18%. While the week began with an increase of about 1.40%, the index plummeted after Wednesday, increasing again slightly on Friday. The S&P 500 behaved in a similar way, with an average increase of 0.06% last week. As for in Europe, the Euro Stoxx 50 finished with a 1.09% decrease. The AEX had an 0.84% increase. The VIX, a popular measure of the stock market’s expectation of volatility implied by S&P 500 index options, dropped by 4.77%.

On the world stage, unsurprisingly, tensions between the US and China continue. Trump refuses to meet with Mr. Xi. This will likely lead to even higher tariffs. These difficulties seem to already be affecting the stock market negatively. Thus, the possible further escalation as of March 1st makes for a gloomy outlook.

Meanwhile, in Europe, the difficulties surrounding the Brexit continue. For one, Britain is having trouble striking a trade deal with Japan. It seems unlikely that Japan will accept a trade deal with Britain which is the same as it has with the EU. Thus, negotiations will take time, increasing the already mounting pressure on the Theresa May to avoid a no-deal Brexit.

Now for the developments in the Flow Traders Investment Competition. Flow Traders released its 2018 4th quarter earning report last Friday, which did not reach expectations and several investment groups feel this hit in their portfolio. Porto d’oro has risen to 3rd place due to the results of the large Japanese telecommunications and internet conglomerate Softbank. They benefited greatly from the company’s large share buyback this past week. Next Generation has also climbed 4 places to 2nd place. It has profited from investment in private equity. Their success is also partly due to their stake in the utilities sector. Notably, Negotium Novum has risen 15 places all the way to 5th places this past week. On a less positive note, MBA investors has faced further major losses this past week due to their investments in Amazon and Advanced Metallurgical.

 

 

By Hazel Alberts