Spreadex Market Update

Investors take bearish stance



European headline shares opened with a bias towards the downside today as investors took a bearish stance before US growth figures which are due for release today.

Economists are expecting today’s figures to show the world’s largest economy grew by 1.9 percent at an annual rate.

Despite economists expecting a positive figure, recent sell offs in Brent futures and US oil clearly indicate that the figures will unlikely be enough to safeguard a steady economic recovery.

Conversely, bulls would quickly point out that there may still be a case for opportunistic investors to take advantage of the recent sell offs in oil.

The four-week moving average for US unemployment claims is still only 368,000, which economists believe is a key figure indicating that new employments are still surpassing dismissals.

This, coupled with western sanctions against oil export giant Iran may prove enough of an incentive for bargain hunters to take advantage of slipping oil prices.

Japan almost hit the spotlight today after announcing a 423 billion yen package to help stimulate the faltering economy, twice the originally expected size.

However, on a day where US growth figures are not due for release, investors would be thrilled that more is being done to support the world’s third largest economy.

Yet, today, such news has been brushed aside as investors remained fixated on the US.

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