Global Economic Update - Week Beginning 9th June

June 9, 2014 - PRLog -- Hexagon Capital Management is a privately held wealth management company that manages hundreds of client assets in a wide range of products and services with a non biased, client orientated program that is tailored to each individual or corporate requirement.

Asian markets started the week in positive territory as they continued the gains seen by the rest of the global markets last week. Data out of China at the weekend showed that the Trade Deficit had increased despite an upturn in exports for May. With the trade deficit at $18.5bn for April, May's $38.9bn did draw some alarm however commentators did suggest that comparisons done against last year's figures would need to be scrutinized as the large amount of fake export invoices created last year to circumvent the currency restrictions would impact this year's data. Exports were up 7% on 2013 however imports fell 1.6% against the same time period. This news helped keep the Asian indexes at close to 3yr highs.

Nikkei 225  at 15,124.00 (+0.31%)          Hang Seng at 23,091.50 (+0.61%)

SSE Comp at 2,030.54 (+0.03%)

Europe closed in the green last week after one of the biggest announcements made by the ECB in some time. Nearly all the local indexes reacted positively as news of the European Central Banks rate decision was released. As expected a drop in their benchmark rate from 0.25% to 0.10% and a reduction on the ECB base rate to -0.10% effectively charging European banks to hold money over night with the ECB. This is seen as an aggressive was to force local banks to speed up and increase their lending, primarily to small business as a way to drive the Eurozone economy forward. Also announced were two schemes also aimed at getting funds to small business. Firstly a €400bn fund has been created and will be available to banks at a reduced rate of interest if they are lending money to clients. The fund is capped at 7% of the total amount lent to clients, thus making capital available to banks to encourage them to lend more. The second scheme is looking to secure small business loans in the form of bonds, alleviating local banks exposure and again allowing them to lend more as their risk is less.

FTSE 100  at 6,858.21 (+0.66%)          Dax at 9,987.19 (+0.40%)

CAC 40 at 4,581.12 (+0.71%)          BEL 20 at 3,171.51 (+0.35%)

IBEX at 11,064.30 (+1.73%)          Zurich SMI at 8,685.69 (+0.19%)

The Dow Jones and S&P 500 have continued their record breaking runs with the S&P closing on its sixth record high out of seven sessions. Buoyed by the ECB announcement and positive employment data the 2 markets again posted strong gains giving rise to questions as to when the run will end. 217,000 jobs were added in May and this was the fourth consecutive month that over 200k jobs had been added to the market. This hadn't happened since January 2000 and has given rise to a sentiment that the US economy is expanding as opposed to recovering. Even though unemployment still sits at 6.3% for May, a slight decrease from April's 6.4% there is still an air of positivity and analysts will be looking to the data later this week on Retail Sales and Producer Prices for further clarification.

Dow Jones Closed at 16,923.28 (+0.52%)

NASDAQ Closed at 4,321.40 (+0.59%)

S&P 500 Closed at 1,949.44 (+0.46%)

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DISCLAIMER  The views, opinions, findings, and conclusions or recommendations expressed on this service are those of the author(s) and do not necessarily reflect the views of the Hexagon Capital Management. All market data within this release is for your general information and enjoys indicative status only. Hexagon Capital Management does not accept any responsibility for its accuracy or for any use to which it may be put. All share prices and market indexes delayed at least 15 minutes. 52 week high and low values are calculated from close price data.