Spreadex Market Update
Market sell-off shows no sign of slowing down as confusing news comes out of China
If true it is an utterly baffling move, one that reflects a worryingly lack of clarity and/or sense in the decision making process at the top of the Chinese period, something that in itself that could have disastrous ramifications down the road.
Either way there was no escaping hefty losses this morning. Soft(ish) jobs data from the UK, with the unemployment rate remaining at 5.6% (but actually increasing by 25,000), still leaves a February rate hike on the cards. This news couldn’t, however, help lift the FTSE away from its 2 weeks lows, especially with Lonmin, Vedanta Resources and KAZ Minerals aggressively haemorrhaging points as the morning went on.
Things were even worse in the Eurozone, with dismal region-wide industrial production data only exacerbating things as the DAX approaching 250 points worth of losses and the CAC stuck firmly into 3 digit-decline territory. On top of this came more scepticism from Germany over the feasibility of the current third bailout agreement, with reports that Wolfgang Schauble will push for a Greek bridging loan on Friday instead of signing off on the deal reflecting how precarious the whole situation remains.
The US futures joined in with the heavy losses this morning, with only JOLTS job openings data this afternoon to distract from the Chinese madness. What will be more interesting is the state of Alibaba’s Q1 2016 results, released before the US open. The e-commerce giant is expected to see a 30% increase in revenue to $3.38 billion, but could see that figure negatively affected by China’s recent economic woes.
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