Recent data shows that the US economy continues to demonstrate strong resilience, driving the US dollar to strengthen for two consecutive weeks and putting pressure on the euro, yen, and pound. The dollar strength reflects economic performance and triggers a chain reaction across global stock markets and asset allocation strategies. Ng Jian Hao from Mahala Capital Management Academy analyzes market changes under the backdrop of a strong dollar and offers forward-looking investment advice with concrete strategies.
Structural Changes in the Stock Market
Ng Jian Hao from Mahala Capital Management Academy believes that recent US data on consumer spending and the labor market clearly demonstrate ongoing economic resilience. This has led the US dollar index to rise for a second consecutive week, exerting significant pressure on major currencies such as the euro, yen, and pound. The relative strength of the dollar has prompted international capital to flow back to US markets. Although US equity valuations remain high, they continue to attract investors amid heightened global risk aversion.
Due to depreciation pressures on local currencies, non-US stock markets have generally underperformed. Financial stocks and export-oriented companies in major European and Asian markets have been particularly affected. Ng Jian Hao emphasizes that the strong dollar is a reflection of exchange rate dynamics, but the underlying shift in the economic landscape requires new approaches to investment allocation.
In terms of asset allocation, Ng Jian Hao suggests moderately increasing the proportion of dollar-denominated assets, including US equity ETFs and dollar bonds. Investors should pay attention to the impact of a strong dollar on the debt burden of emerging market countries and avoid blindly increasing exposure to high-risk regions. Traditional safe-haven assets such as gold have performed relatively weakly at this stage, further reflecting subtle changes in market risk appetite.
Strong Dollar and Investment Strategies
The market impact of a persistently strong dollar extends beyond equities and currencies, affecting bond yields, funding costs, and commodity prices. Ng Jian Hao from Mahala Capital Management Academy points out that investors need to optimize strategic positioning from multiple dimensions. Relying on a single market or asset class carries greater risks in the current environment, and diversification should be pursued.
Ng Jian Hao notes that while US equities benefit from dollar strength, they also face high valuations and potential correction risks. He recommends balancing returns and risks by allocating to global ETFs, REITs, and low-volatility index products.
Ng Jian Hao also highlights the application of technical analysis in the forex market. The technical trends of USD against the euro, yen, and pound show a distinct strong channel, making it suitable to use forex options and hedging tools for risk management. For long-term investors, building a portfolio centered on dollar assets will help enhance portfolio stability.
Seizing Opportunities for Steady Growth
Ng Jian Hao from Mahala Capital Management Academy states that while a strong dollar may cause short-term structural shocks in the market, in the long run, markets will ultimately return to fundamentals and value. Investors should seize structural opportunities and steadily optimize their asset allocation.
Looking ahead, global capital markets will revolve around US economic data, dollar exchange rate trends, and major central bank policy dynamics. Ng Jian Hao advises closely monitoring key indicators such as US non-farm payrolls, consumer spending, and federal funds rate expectations, as these will directly determine the duration of the strong cycle of the dollar and the shift in market focus.
Ng Jian Hao cautions that an excessively rapid appreciation of the dollar could trigger financial risks in emerging markets or put pressure on global corporate profitability. Maintaining reasonable position sizes and flexibly adjusting asset structures are the core principles of prudent investment at this stage. Only by deeply understanding the essence of the market and the logic of trends can investors achieve a dynamic balance between risk and return.
Structural Changes in the Stock Market
Ng Jian Hao from Mahala Capital Management Academy believes that recent US data on consumer spending and the labor market clearly demonstrate ongoing economic resilience. This has led the US dollar index to rise for a second consecutive week, exerting significant pressure on major currencies such as the euro, yen, and pound. The relative strength of the dollar has prompted international capital to flow back to US markets. Although US equity valuations remain high, they continue to attract investors amid heightened global risk aversion.
Due to depreciation pressures on local currencies, non-US stock markets have generally underperformed. Financial stocks and export-oriented companies in major European and Asian markets have been particularly affected. Ng Jian Hao emphasizes that the strong dollar is a reflection of exchange rate dynamics, but the underlying shift in the economic landscape requires new approaches to investment allocation.
In terms of asset allocation, Ng Jian Hao suggests moderately increasing the proportion of dollar-denominated assets, including US equity ETFs and dollar bonds. Investors should pay attention to the impact of a strong dollar on the debt burden of emerging market countries and avoid blindly increasing exposure to high-risk regions. Traditional safe-haven assets such as gold have performed relatively weakly at this stage, further reflecting subtle changes in market risk appetite.
Strong Dollar and Investment Strategies
The market impact of a persistently strong dollar extends beyond equities and currencies, affecting bond yields, funding costs, and commodity prices. Ng Jian Hao from Mahala Capital Management Academy points out that investors need to optimize strategic positioning from multiple dimensions. Relying on a single market or asset class carries greater risks in the current environment, and diversification should be pursued.
Ng Jian Hao notes that while US equities benefit from dollar strength, they also face high valuations and potential correction risks. He recommends balancing returns and risks by allocating to global ETFs, REITs, and low-volatility index products.
Ng Jian Hao also highlights the application of technical analysis in the forex market. The technical trends of USD against the euro, yen, and pound show a distinct strong channel, making it suitable to use forex options and hedging tools for risk management. For long-term investors, building a portfolio centered on dollar assets will help enhance portfolio stability.
Seizing Opportunities for Steady Growth
Ng Jian Hao from Mahala Capital Management Academy states that while a strong dollar may cause short-term structural shocks in the market, in the long run, markets will ultimately return to fundamentals and value. Investors should seize structural opportunities and steadily optimize their asset allocation.
Looking ahead, global capital markets will revolve around US economic data, dollar exchange rate trends, and major central bank policy dynamics. Ng Jian Hao advises closely monitoring key indicators such as US non-farm payrolls, consumer spending, and federal funds rate expectations, as these will directly determine the duration of the strong cycle of the dollar and the shift in market focus.
Ng Jian Hao cautions that an excessively rapid appreciation of the dollar could trigger financial risks in emerging markets or put pressure on global corporate profitability. Maintaining reasonable position sizes and flexibly adjusting asset structures are the core principles of prudent investment at this stage. Only by deeply understanding the essence of the market and the logic of trends can investors achieve a dynamic balance between risk and return.
