🇯🇵 Watch out, Japan

Japan's wake up call, Europe's stock market record, and morning coffee substitutes | [Finimize](   TOGETHER WITH     Hi {NAME}, here's what you need to know for August 31st in 3:13 minutes.   🧦 They say never look a gift horse in the mouth. So complete [this 20-second survey](, and you could win some fresh Finimize swag. [Fill in the quick survey]( Today's big stories - Tokyo's inflation ticked up in August, giving the Bank of Japan a tap on the shoulder - Diversification doesn’t have to mean putting a few eggs in some seemingly lifeless baskets – [Read Now]( - European stocks hit a record high, despite the region's drab economy Nudge, Nudge [Nudge, Nudge] What’s going on here? Tokyo’s inflation [picked]( up in August, which could give the Bank of Japan (BoJ) a poke in the ribs. What does this mean? Changeable fresh food aside, Tokyo’s prices rose by a higher-than-expected 2.4% in August, more than the 2.2% notched in July. And because the capital tends to set the tone for the country as a whole, those figures could foreshadow Japan’s September inflation report. But it seems the country’s economy might be straining already: the unemployment rate nudged up to 2.7% in July, retail sales slowed down to barely outpace inflation, and factory output grew by 2.8% – well short of the 3.5% forecast. Why should I care? For markets: Once bitten, twice shy. The BoJ has hinted that it might hike interest rates for the second time this year, but the central bank won’t take that decision lightly. If borrowing costs get too high too fast, shoppers will hold back in the stores – and that would weigh on the economy. Plus, higher rates tend to buoy up a country’s currency. That would, in turn, make Japanese exports look more expensive, potentially putting international buyers off. And don’t forget that the BoJ’s recent hike triggered a panicked $6.4 trillion stock selloff across global markets. So, wary of another financial freakout, the central bank could keep rates steady for longer. The bigger picture: A shot in the arm. Japan’s stock market was left battered and bruised after the selloff. And since then, the Topix pharmaceutical index has been the only one to hit a fresh record high. That makes sense: pharmaceutical companies tend to be more resilient when the economy catches a cold – and not just thanks to their hefty vitamin C inventories. Although, while investors have been flocking to the sector for a sense of security, they could be quick to cash out when the Japanese stock market picks back up. You might also like: [Carry trades torpedoed the market, but they’re still everywhere.]( Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Nudge, Nudge&utm_campaign=daily-global-31-08-2024&utm_source=email) Analyst Take This Strategy Aims To Diversify Your Portfolio And Boost Its Returns [This Strategy Aims To Diversify Your Portfolio And Boost Its Returns]( [Photo of Reda Farran, CFA] Reda Farran, CFA, Analyst [Diversification]( is probably the most-quoted investment advice of all time – and, at this point, you might be tired of hearing about it. But there’s wisdom (and [wealth]() to be gained from it. And the approach you use to spread out your risk doesn’t have to be as bland as putting a few eggs in some seemingly lifeless [baskets](. The [composite dual momentum strategy]( is a tactical allocation tool that aims to spread your money across the market’s best-performing and least-boring assets. That’s today’s Insight: [how to diversify without giving up on returns](. [Read or listen to the Insight here]( SPONSORED BY IG Master US-listed options trading for free – no matter your experience level You’re reading this, so it’s safe to assume that you like staying up-to-date with the market. But if you have your own projections, stocks and ETFs may only get you so far. Options, on the other hand, give you the chance to [benefit from a price move in either direction](. You can take out an [options contract]( to secure the option – not the obligation – to buy or sell an asset at a predefined price and a predefined time and date. So if you want to hone your skills without paying a buck, [check out the free course today](. [Find Out More]( Options and futures are complex instruments which come with a high risk of losing money rapidly due to leverage. You could lose more than your original investment. When you support our sponsors, you support us. Thanks for that. If you want your brand featured here, [get in touch.]( Summer Lovin’ [Summer Lovin’] What’s going on here? The Pan-European Stoxx 600 index notched a record high on Friday, leaving it sitting nearly 10% higher than it started the year. What does this mean? The broad index includes 600 firms of different sizes from across 17 European countries. And it’s been rising for four straight weeks – the longest run since March. See, despite Europe’s tepid economy, the region is home to world-leading tech and healthcare companies that make a chunk of their money abroad. That includes Novo Nordisk and ASML: the weight-loss-drug manufacturer’s share price has steamed ahead by 42% this year, while the chipmaking equipment firm has seen its stock rise 22%. But at the same time, companies that rely on China for profit are lagging – think luxury firms like LVMH and carmakers like BMW and Volkswagen. Why should I care? For markets: Let’s get down. Inflation in the eurozone fell to a three-year low of 2.2% in August, easily below July’s reading of 2.6%. And it’s not just in Europe, either: the Federal Reserve’s favorite inflation measure was in line with expectations in August, showing that US inflation is relatively subdued. Remember, lower inflation could encourage central banks to cut interest rates. That wouldn’t just make it cheaper for companies to invest in themselves, lower rates also increase stock valuations. The bigger picture: Calling Doctor Copper. Lower interest rates and a healthier economy could fire up industries. And plenty of them would stock up on copper, stat: the metal’s essential for a long line of processes – so much so that it’s known as Doctor Copper, skilled at reflecting the state of the economy. It may seem reassuring, then, that the metal’s price hit a six-week high this week. But there’s no such thing as a sure bet: the shiny stuff’s price tumbled not long ago, with investors wary of dried-up demand from China, which usually buys around 50% of the world’s copper. You might also like: [The yo-yo stock gains and losses of Novo Nordisk and Eli Lilly](. Copy to share story: [( 🙋 [Ask a question](mailto:questions@finimize.com?body=Ask us a question: Where are you writing from? Let us know and we'll mention it when we reply.&noapp=true&subject=Summer Lovin’&utm_campaign=daily-global-31-08-2024&utm_source=email) 💬 Quote of the day "The more you read, the more things you will know. The more that you learn, the more places you'll go." – Dr. Seuss (an American children's author) [Tweet this]( Join the Oracle Of Wall Street this December They say you can’t predict the future. Well, try saying that to [Meredith Whitney](, the analyst who predicted the 2008 financial crisis. Once known as the “Oracle Of Wall Street”, Meredith Whitney has been sounding the alarm again, predicting that [several factors in the US]( could push several regional banks over the edge. So forget about your tarot card appointment: [grab your ticket for the Modern Investor Summit]( this December 3rd and 4th, and find out what Meredith Whitney sees coming for the global economy. (Plus, [secure your free ticket by the end of the month](, and you could win an Echo Dot. Swanky, hey.) [Grab Your Free Ticket]( 🎯 On Our Radar 1. Fine wine. Here are the [best celebrity wines](, from the likes of Snoop Dogg and Kylie Minogue. 2. Like Google Maps, but for technical ETFs. [Direxion's guide to trading leveraged and inverse ETFs is live.](* 3. Move over, Joe. These alternatives might be a [better kickstart to the morning than coffee](. 4. Talk about being “in the money”. [Get the lingo down]( before you trade options. 5. It's a wild, wild, life. A selection of pictures from the [Wildlife Photographer of the Year awards](. When you support our sponsors, you support us. Thanks for that. 🌍 Finimize Live 🤩 Grab your tickets... All events in UK time.5️⃣ [Five Top Tips Every Options Trader Should Know:]( 5pm, September 11th 🔨 [Five Portfolio Hacks For Busy Investors:]( 5pm, September 12th 🚀 [2024 Modern Investor Summit](: 2pm, December 3rd ❤️ Share with a friend Thanks for reading {NAME}. If you liked today's brief, we'd love for you to share it with a friend. You stay classy, {NAME} 😉 We’d love to hear your thoughts. [Give feedback]( Want to advertise with us too? 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