Laissez-Faire: An economic theory that opposed any government intervention in business affairs. 

Phillips Curve: An economic concept stating that inflation and unemployment have a stable and inverse relationship. Higher inflation environment (strong economy) will provide more employment i.e. lower unemployment rate.  However this been somewhat disproven empirically due to the occurrence of stagflation. 

Stagflation: Occurs when an economy experiences stagnant growth, high unemployment and high price inflation. 

Yield Curve: A curve that shows the interest rate associated with different contract lengths for a particular debt instrument such as Treasury Bill in US. 

What is yield curve telling? - when yield curve is upward sloping, it tells market returns higher interest rate for longer maturity debt. Whereas for inverted yield curve (downward sloping), longer maturity debt interest rates fall below short term debt. This implied long term investors are willing to settle for lower yields. Generally which meant lose a confident and people expect recession is coming. 

Davis double-killing effect: popular terms in China based on rules of thumb from Davis, a company with low PE but strong EPS growth. During the bear market, sentiment always give relatively lower PE for Fundamentally strong company. So when bull market return, the coupling effect of stock's revaluation and strong grow of company would create a double kill effect. 

info quoted from: https://www.investopedia.com/

History of Interest Rates and Share Markets  

In USA, Fed raised the target range for fed funds rate by 75bps to 2.25% - 2.5% during Jul 2022. It is at its highest level since 2019. Looking at 10 years history, it could be summarised as 4 stages:

1. Close to zero rate - post 2008 financial crisis to year end 2015. 

2. Gradual interest rate hike from 2016 to 2019; peak at 2.5%.

3. Slowly adjust downwards from end of 2019 to early 2020 followed by drastically dropped, back to stage 1 level from 2020 to end of 2021. 

4. Drastically adjust upwards to 2.5% level from early 2022. 

What happened in between? By using Dow Jones Industrial Average as guidance: 

Stage 1, share market going up during easy credit period. Commodity (oil) price slowly coming to overheat level before crash at 2015. 

Stage 2, market bumped initially but recovered well, created another bulls market. Commodity (oil) range bound at certain level. Republican president was elected with lower tax and business favour policies. 

Stage 3, US president election year then followed by Covid 19 declared as pandemic by March 2020. Market dipped down to low level then bounced back sharply to all time high in short time with easy monies flowing around. 

Stage 4, sharp increase in rate causing market back down to near pre-pandemic level. 

For Malaysia Bank Negara Overnight Policy Rate (OPR), the trend is similar except there are no stage 1& 2 as Malaysia is relatively less impact than US during 2008 Financial Crisis. 

Interest rate remain stable around 3% from 2014 to 2020 till aggressive rate cut during 2020 to 1.8% during Pandemic and rate hike again by 2022 back to 2.2% level. Share market is peak at 2014 when oil price at its recent peak then range bound between 2015 to 2020 before Pandemic. When rate is cut during 2020, KLCI did went up recover from early Covid panic sell but it never went back or even close to 2015 level.   

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info and full interest chart quoted from: https://tradingeconomics.com