Market Updates
30 August 2010
Anxiety about faltering US growth continued to drive investor sentiment with evidence that the US housing market may be back in recession resulting in equities recording their third straight weekly decline as funds flowed into government bonds and other safe-haven investments such as gold and the Japanese yen. A string of disappointing statistics on the state of the US housing market combined with weak durable goods orders data to drive yields in several ‘core’ government bond markets to all-time lows.
9 August 2010
Growing concern over the strength of the US recovery sent the yield on two-year Treasury notes to a record low and sparked a further decline in the dollar’s value last week as investors speculated the Federal Reserve will be forced to take further steps to prevent the economy sinking back into recession. However, despite the gloomier economic outlook stock markets climbed for a third straight week, underpinned by the continued flow of better-than-expected corporate results.
2 August 2010
It was a volatile week in financial markets as conflicting news pulled markets in opposing directions. The release of the much anticipated European bank stress tests late on Friday of the previous week provided some cheer, principally due to the fact there were no major surprises and for the seven banks that did fail, it was forecast that only €3.5bn of additional capital would be required for them to be deemed safe.
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.
If you require earlier market updates, please e-mail Daniel Carver