2nd May 2014 - Economic and Global Market Review
Global Market Data as of 2nd May 2014
FTSE 100 6,808.87 (+0.43%) Dax 9,603.23 (+0.20%)
CAC 40 4,487.39 (-0.23%) BEL 20 3,089.80 (-0.52%)
Madrid IBEX 10,459.00 (-0.02%) Zurich SMI 8,476.66 (+0.50%)
Moscow MCIEX 1,280.81 (+1.96%) Sydney ASX 5,438.80 (+0.15%)
Nikkei 225 14,467.08 (-0.12%) Hang Seng 22,261.12 (+0.57%)
Shang SSE Comp 2,026.36 (+0.30%)
Dow Jones 16,558.87 (-0.13%) NASDAQ 4,127.54 (+0.31%)
S&P 500 1,883.68 (-0.01%)
Chinese markets are closed today and after the May 1 holiday the remaining indexes have remained relatively quiet. The Nikkei saw positive gains early on Friday trading after good data out of the US late yesterday but saw some profit taking late in the afternoon ahead of a 4 day weekend which see's the Tokyo markets closed on Monday and Tuesday. The BoJ was again called into question as they continue their stimulus plan in an attempt to ease the local economy. With an extended drop in exports and a huge increase in energy imports the Central Bank raised sales taxes last month from 5% to 8% however this was seen by some analysts as a small step in what is becoming a concerning situation.
European markets should open slightly higher today despite growing tensions in Ukraine. With all but a few markets closed yesterday volumes will probably be quite low today and the focus will be on economic data out of the US. UK markets should open strongly this morning after Pfizer increased their offer for AstraZeneca to £50.00 per share valuing the company at £63bn. The pharmaceutical giant also sent a letter to the UK Prime Minister stating that they will keep certain departments in the UK, specifically segments of the R&D division. The proposed takeover comes off the back of another huge M&A deal between Novartis and GlaxoSmithKline earlier in the week.
It has been a week of mixed signals regarding the US economy however the general sentiment is that recovery in happening. It looks like over 210,000 jobs were added in April, the most in the last 5 months. Up over 9% on last month the news will probably help open the local markets higher as additional data is expected early today via the Jobs Report. Unemployment should be down again and projected at 6.6% which will be the lowest in almost 5 years. With the first quarter out of the way and businesses fully recovered from he inclement weather seen at the beginning of the year factory orders data is also expected to be stronger than previously reported. April was a rough month for the local markets and they managed to start May in a stronger position than they started in April. Whether the old saying "Sell in May and stay Away" holds true this year we can only speculate. Trends are trends for a reason and with Moscow and Washington still pointing fingers at each other we may well see a month of lower volumes and less volatility across the board.
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