Global Market News -Weekly Update 27/8/2014

Aug. 27, 2014 - PRLog -- Capetian Asset Management is a world-wide private equity firm with the resources and expertise to source, evaluate, and manage private investments globally in both developed and developing markets and across many industrial and commercial sectors.

Global Market Review -Weekly Update 27/8/2014

Asian markets were close to 7 year highs today on a positive outlook from the US and the implication that the ECB is close to making some form of QE announcement.

Both the Nikkei and Hang Seng saw early gains which petered out by late Wednesday. With Japan releasing a range of economic data from today until Friday it is no surprise that the local markets remained cautious and looked to hold on to their gains of recent weeks. The Japanese economy has been under some scrutiny lately and this week's host of data will be a good indicator as to how well the economy has fared since the sales tax increase.

China will release its manufacturing data early next week and although this is forecast to be slightly lower, we should still see some positivity from the world's second largest economy.

All eyes are on Europe at the moment. Opening higher this Wednesday, the markets are still buoyed by the news from the ECB that measures will be taken to stem the reversal in economic harmony that has been seen of late. With key data on sentiment and confidence due tomorrow and inflation data on Friday it is going to be a busy week for the ECB and the European Parliament alike. Fan fared by many, the thought of QE in Europe has been seen as positive and the regional markets have rallied since Mario Draghi announcement.

However, the Euro has been pushed close to 11 month lows and the move by the ECB has seen EU bond yields drop significantly, most notably Germany, Spain and Italy.

If inflation is as low as forecast at 0.3%, down from 0.4% last month, it is expected that the ECB will make some form of policy announcement as early as next week and that further easing will be implemented over the coming months.

In the US it is a different story according to Ms. Yellen, the head of the Federal Reserve. Speaking yesterday she continued her position that monetary policy could not help the employment market and that only fiscal policy would help push wages up and keep the economy moving forward.

For some time now the Fed has been easing back from its QE and reducing its asset buying by a substantial amount each month. Just a few weeks ago a more hawkish interpretation was placed on the FOMC notes suggesting a rate increase, initially expected in late 2015, could come far earlier. This latest statement from the Fed would imply that this may not be the case and that interest rates will remain as they are until the employment sector has started to see wages increase.

The major indexes in the US are certainly still feeling positive however with the S&P 500 breaking and closing above 2,000 for the first time in history. Depending on whether you are a bull or a bear, you can take that as an indication that the US's exposure to Europe has been placated with the news out of the ECB.

Key Market Data as of 27/8/2014:

Hang Seng: 24,953.06 (-0.48%)      Nikkei: 15,534.82 (+0.09%)

Dow: 17,106.70 (+0.17%)          S&P 500: 2,000.02 (+0.11%)

FTSE: 6,824.41 (+0.02%)          Dax: 9,596.66 (+0.08%)

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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 Capetian Asset Management. All market data within this release is for your general information and enjoys indicative status only. Capetian Asset 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.