Market Updates
26 July 2010
There was a deluge of news for markets to digest last week. To the good, corporate results in the US, UK and Europe were encouraging across a number of sectors. The UK economy grew by an estimated 1.1 per cent in the second quarter – about double the rate anticipated. Friday’s long-awaited bank ‘stress-tests’ revealed that of the 91 European banks reviewed only seven smaller banks would fail capital adequacy guidelines in a projected downturn, although many critics feel the methodology was insufficiently exacting. Confidence and output numbers from Europe also surprised on the upside, while a flurry of M&A activity added fizz to UK equities: the FTSE 100 closed up 3 per cent on the week at 5,312.
19 July 2010
A month ago, problems in the eurozone were at the heart of investor anxiety. Now it appears to be developments in the US – and their potential impact on the global recovery – that fixate markets, with speculation mounting that the Fed may have to re-introduce quantitative easing to support a domestic economy looking increasingly enfeebled.
12 July 10
After a slow start, with US markets closed Monday, equities were much more upbeat last week. A distinct change in sentiment developed on a tide of positively interpreted newsflow. The IMF revised 2010 forecasts for world growth up from 4.2 per cent to 4.6 per cent. The success of the Agricultural Bank of China’s IPO boosted Asian markets. German export growth surged by 9.2 per cent in May. This allied with expectations that stress-tests for some 90 major European banks would restore confidence in the sector, boosted European equities.
5 July 2010
Markets turned unequivocally bearish during the week – stoked by growing fear, if not of a double-dip recession, then of mounting evidence of slowing growth. Equities markets fell in lock-step, with the Nikkei 225 falling nearly 5.5 per cent on the week; the S&P 500 by over 5 per cent ahead of the long Independence Day weekend, and the Eurofirst 300 by 4.3 per cent. The FTSE 100 at one point dipped almost as low as 4,800, before rallying slightly on Friday, to close the week 4.1 per cent down.
28 June 2010
It was an unsettled week for markets, with investors unable to decide whether global recovery is just around the corner – or the world economy is set to topple into double-dip recession, exacerbated by uncoordinated austerity measures. Equities rallied strongly on Monday on news that the Chinese would allow the Yuan (also known as the Renminbi) to appreciate against a basket of currencies, undoing a dollar-peg in place since mid-2008.
If you require earlier market updates, please e-mail Daniel Carver