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Sentiment in Asia: Seemingly One-Sided

Learn what this negativity means for financial trends

by Alexandra Lienhard
Updated: October 10, 2016

In this new interview with Mark Galasiewski, who edits the Asian-Pacific portion of Global Market Perspective, he talks about the increasing negative sentiment in the Asian-Pacific region and explains why all of the resulting events have great significance for financial trends in the region.


[Editor's note: The text version of this interview is below.]

Alexandra Lienhard: I'm Alexandra Lienhard and today on ElliottWaveTV I'm joined by Mark Galasiewski. Mark edits the Asian-Pacific commentary for Elliott Wave International's monthly Global Market Perspective.

Now Mark, EM, and to a lesser degree, global trade have been major themes in 2016 and it's something you've written about extensively. In the October Global Market Perspective, you take a particularly strong stance. Tell me a bit about that.

Mark Galasiewski: Right, for many years there's been a strong relationship between emerging markets and commodities, as well as related prices such as the cost of shipping goods internationally and equity prices of shipping companies. In this issue we look at all of these factors, considering their long-term wave patterns to come up with a forecast for the next few years for global trade that we think is very convincing.

Alexandra: Now sentiment in Asia seems to be increasingly one-sided. What are you seeing over there and what are the potential implications going forward?

Mark: Right, there was a lot of negativity, or has been over the past several weeks in Asia. Actually, there are so many incidents that I'm going to consult my notes on this one. First, in Japan, a persistently high short-sell rate; in Taiwan, a boom in inverse ETFs; on the Australian Stock Exchange, the worst trading malfunction in years; of course, North Korea's nuclear test; in Hong Kong, a strong turnout for protest party candidates in the legislative council elections; and finally, the worst Indo-Pakistani military conflict in 17 years.

Now the question is why is all of this stuff happening at this particular time? I'm going to let our viewers read about that in the issue, but suffice to say that all of these events have great significance for financial trends in the region from the perspective of market psychology, which we explain in the issue.

Alexandra: Now Mark, speaking of trends, you presented an interesting argument relating to the Pakistanian Stock Market and fatalities in Afghanistan. Can you provide a little bit of background on that and what your findings were?

Mark: Right, 8 years ago we noted a relationship between trends in Pakistan's stock market and fatalities among foreign troops fighting in Afghanistan. That is the waves in one appeared to correlate with the waves in the other. The question is, is there a causal relationship between these two phenomenon that we're observing? And here at EWI, we believe there is. We believe it's the social mood in the region which is ebbing and flowing with Pakistan's stock market. And which is influencing the waves of violence or relative peace in the region.

We now have 14 years of data to support this study and personally, this is one of my favorite studies that I've ever done here at EWI and I hope that our readers also find it interesting.

Alexandra: Well it sounds like the latest issue promises to be an interesting read. Thanks Mark, I appreciate it.

Mark: Thanks Alex.

Mark Galaswieski edits the Asian-Pacific section of Global Market Perspective -- the monthly 50-page publication that gives you in-depth, longer-term views of European, U.S., and Asia-Pacific stock indexes. Now is the time to learn about worldwide investment opportunities. Visit the link below to learn how you can subscribe to EWI's Global Market Perspective.

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Covering more than 40 markets on 50-plus pages each month, Global Market Perspective prepares subscribers for opportunities around the world. Get the latest forecasts for U.S., Asian-Pacific and European stocks and economies, global currencies, bonds, crude oil and more.

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