Global Index and Economic Update 5th June 2014

June 5, 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.

Global indexes continued to hold their gains of the past few weeks as we await the ECB meeting in Frankfurt later today and the promise of a stimulus package to help ease the Eurozone's economy.

Asian indexes were fairly mute today as expectations for Europe held the markets relatively flat. In China, HSBC's Services Sector figures showed a contraction for May. April's 51.4 was not bested as many had hoped and the final figure supplied was 50.7. Although down, anything over 50 is still seen as an expansion and considering we have a range of figures on Import and Export data along with the Trade Balance at the weekend it would not be too farfetched to see some profit taking in the region tomorrow should the ECB come through with the stimulus we are expecting. The Nikkei, which has been on a two week run, slowed down today. Japanese markets tend to be cautious before a big announcement and seeing as they seen good value of late, tomorrow could see the Nikkei dip further on profit taking.

Nikkei 225  at 15,079.37 (+0.08%)          Hang Seng at 23,088.96 (-0.27%)

SSE Comp at 2,038.49 (+0.67%)

As Europe opened flat today all expectations are for later this afternoon when the long awaited ECB meeting in Frankfurt takes place. For the past month there has been speculation of a round of stimulus measure that will hopefully reverse the low inflation currently being seen in the EU. What we have been told to expect is a probably base rate reduction of 15 points bringing the ECB base rate down to 0.10%. This along with a reduction in the depository rate, bringing it down to -0.10% is seen a a huge step in bringing inflation back to the EU. With these implemented we should see an increase rate of lending as banks will be adverse to paying interest on monies left with the ECB overnight and the intention is to stop people from holding off their purchases under the assumption that prices will continue to fall. Inflation was at 0.5% for May and this is significantly under their 2% target. Additionally, plans for a refinancing operation would look to fund smaller business thus looking to boost the economy form the ground up. The ECB's announcement later today will under line their intentions and there is still room for further stimulus programs should this prove too little.

FTSE 100  at 6,818.63 (-0.26%)          Dax at 9,926.67 (+0.07%)

CAC 40 at 4,502.00 (-0.06%)          BEL 20 at 3,142.93 (-0.56%)

IBEX at 10,755.60 (-0.20%)          Zurich SMI at 8,661.08 (-0.00)

Local indexes in the US have continued to hit record highs with the S&P closing at record highs 4 out of the last 6 sessions. With serious investor confidence pushing the markets higher and continued confirmation that the economy is recovering. Since rumours of EU QE were posted the markets in the States have responded particularly strongly and the volumes seen for the month of May were considerably higher than normal years. The inference that the EU will follow the lines of the FED and buy their way out of the economic doldrums was obviously seen as they way forward and as with Asian markets, once the ECB confirms its program later today, there could be some corrections as investors look to lock out profit. Alternatively we could see more capital return as bonds become less attractive and the money returns to the markets with full effect. Its not just the ECB that the US will be watching today. Jobless data and the FED Balance will be announced later today and tomorrow we are privy to Payroll and Unemployment numbers. All of which should make for an interesting close to the first week of June.

Dow Jones Closed at 16,737.53 (+0.09%)

NASDAQ Closed at 4,251.64 (+0.41%)

S&P 500 Closed at 1,927.88 (+0.19%)

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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.