Fuji Credit Asset Management says global equity markets have had a volatile start to the new year following worse-than-expected economic data from China. China’s main indexes plunged by 5% triggering “circuit breakers” that halted trading for 15 minutes. Upon resuming trading, the circuit breakers kicked in again after the markets declined a further 7%. This time, they halted trading for the remainder of the session.

Circuit breakers were introduced by the Chinese authorities as way of minimizing volatility in the hope preventing the deep selloffs that punished the Shanghai and Shenzhen Composites last summer.

“These circuit breakers most certainly aren’t to blame for causing the volatility but there is cause to believe that they could have exacerbated the situation in the markets,” said Fuji Credit Asset Management’s Head of Corporate Trading Tony Williams.

European markets took their cues from their Chinese counterparts and sold off sharply as did US bourses.

“These opening week jitters are being blamed on the perception that the economic slowdown in the world’s second biggest economy is worse than initially thought but we don’t subscribe to that reasoning,” explained Williams.

“Fuji Credit Asset Management is of the opinion that the tightening of money policy in the US and the fear of further interest rate hikes is largely to blame. Investors can’t see anything tangible holding share prices at their current lofty levels and so they’re heading for the exits,” he concluded.

The firm believes that bond and gold prices will rise as investors switch to safe haven assets and it has reiterated its buy recommendations on gold and silver.

About Fuji Credit Asset Management:
Fuji Credit Asset Management is a fully independent, investment management practice that provides prudent, well-researched guidance and counsel to individuals, families and institutions with a need to accumulate and preserve wealth.

Fuji Credit Asset Management is a fee-only practice. This means that they are compensated solely by our clients and they neither accept nor solicit inducements or remuneration from product providers or financial institutions in return for endorsing or recommending particular investments or financial products.

Contact Fuji Credit Asset Management:
Osaka, Japan
81630238913
[email protected]
http://www.fujicredit.com