Peter Brown: The hot stocks and metal for the climate change fight
File picture of the Ranger Uranium Mine in Australia’s Northern Territory. Stockmarkets are focusing on the huge imbalances between supply and demand as the global economy roars back from the Covid crisis, hence the price of shipping containers has trebled, many raw materials are in short supply, and inflation is now dominating market thinking.
Inflation is bad for stock prices, if it leads to a rise in interest rates.
If rates were to rise, company earnings would be less attractive and therefore lead to lower valuations, and any correction to valuations could be severe.The authorities in the US say recent price rises are transitory, a message the market has bought into. For the past decade passive investing has been extraordinarily successful.Just buying the index has made substantial returns.However, given the over-extended valuations of the US stocks, where may […]
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