###POV: SEASONAL EQUITIES, EMFX AT RISK -.....>

FOREX: ###POV: SEASONAL EQUITIES, EMFX AT RISK

- Historically, September is the weakest month for stocks. The Dow Jones

Industrial Average in the last 50 years has registered losses of -0.88%, S&P

-0.50% and the Nasdaq -0.50%, since its inception in 1971.

- What are the reasons behind this? Firstly, traders remain on summer vacations

enhancing thin liquidity. Secondly, it is the financial year-end for mutual

funds. Fund managers will normally sell their losses and undertake some window

shopping in order to make their fund look more attractive, also to reduce tax

burdens.

- Another factor is during mid-term election years, especially the second year,

where stocks are traditionally weaker. This is due to the uncertainty associated

with the change in the presidential party's representation in congress.

- Interestingly the CBOE Volatility Index (VIX) has already witnessed near 20%

gains in September, suggesting a volatile month lies ahead.

- Escalating US-China trade wars should also keep markets risk-averse,

suggesting further pain for EMFX currency pairs.