27th May 2014 - Global Markets and Economic Review
Global Market Data as of 27th May 2014
FTSE 100 6,815.75 (-0.07%) Dax 9,892.82 (+1.28%)
CAC 40 4,526.93 (+0.75%) BEL 20 3,145.61 (-0.38%)
Madrid IBEX 10,687.50 (+1.22%) Zurich SMI 8,712.35 (+0.10%)
Moscow MCIEX 1,387.56 (+4.44%) Sydney ASX 5,490.80 (+0.01%)
Nikkei 225 14,636.52 (+0.26%) Hang Seng 22,926.58 (-0.16%)
Shang SSE Comp 2,036.38 (-0.25%)
Dow Jones 16,606.27 (+0.38%) NASDAQ 4,185.81 (+1.31%)
S&P 500 1,900.53 (+0.42%)
Asian markets were cautious Tuesday morning after having little to go on with the UK and United States both having trading holidays. The Nikkei managed to reverse yesterday's gains seen mostly off the back of strong PMI data out of China and a good performance seen last Friday on Wall Street. With the Bank of Japan looking for an exit strategy form their quantative easing and the regions analysts looking to later in the week for data out of Tokyo it is fair to expect a relatively quiet week. Thursday will see an indication of foreign investment in Japan and on Friday we will see a range of data from inflation and unemployment to industrial production and housing data. There is a rest bite of about a week before we receive further data from China, with what could be construed as positive figures recently many will be keen to see whether the first quarter of 2014 was hindered by the Chinese New Year or whether the economy is genuinely slowing down. One good factor is that the Chinese Government is not shying away from efforts to boost their small to medium business enterprises and clean up their financial systems, primarily speeding up the lending process and making foreign and domestic investment easier.
After a positive day for European markets yesterday, it is expected that the majority of the indexes will open slightly lower today. Major headlines on the EU Parliamentary vote and the Ukraine will no doubt make investors nervous. Mainland markets responded well to the voting out of Ukraine which looked to start to close out the troubles there. With the potential of a dialogue being opened between Moscow and Kiev the markets were buoyed to gains however the reports of 30 pro-separatist fatalities at the airport in Donetsk early Tuesday morning may slow down the celebrations of a resolution. With an economy looking like it is in recovery many will be concerned over the surprise results that came out of the EU elections. With a definitive swing to the far right in several nations the fact that seats are being lost to member parties that actively look to exit the single currency union is a troublesome fact for many, especially with European members still fighting to recover from a recession still too close to forget. With the European Central Bank's meeting just over a week away all eyes will be on Mario Draghi and what he will announce on the 5th June. A stimulus to drive the union forward is what has been hinted at yet an increase in the base rate may not be enough to placate the critics. Tomorrow see's Industrial and Economic sentiment indicators and a consumer confidence figure that is expected to be lower than last month. We should see Business Confidence for the EU higher than previously reported which would suggest that the major players in Europe feel that are back on track.
The US markets return after the Memorial Day holiday to a week jammed packed with economic indicators. With the S&P breaking record ground last week to close out Fridays trading over 1900 points it is to be expected that the indexes will open on the side of caution and will look to close out some profit before the influx of figures. With the old adage of "Sell in May and stay away" not really having taken place this month we can expect a good volume today as traders catch up on a short week. Data today comprises of the Housing Price Index, Markits PMI Flash and both Richmond and Dallas's Manufacturing Index. Tomorrow see's Mortgage data, Chain Store Sales and the Redbook with Thursday and Friday reporting on GDP, Jobless Claims and Pending Housing Data with Personal Consumption Index (PCE) and Personal Income data to close out the week.
Its a busy week for economists and analysts and as the month draws to an end. Markets this week are expected to be stable and even though there is a plethora of global economic data due this week there shouldnt bee too many surprises.
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