Spreadex Market Update
Varoufakis arrives in London, manufacturing PMI the data of the day
Angela Merkel stated over the weekend that any debt negotiation is unrealistic, and with Greece and Germany unable to even decide on a meeting, it looks like a long and protracted road ahead for Syriza and their renegotiation quest. However, the Eurozone markets were in fairly good cheer this morning as Spanish manufacturing PMI beat forecasts, with positive Italian and region-wide manufacturing PMI data expected later this morning.
Oil had a remarkable end to last week, with the news that 94 US and 11 Canadian oil rigs were ‘taken offline’ causing a big easing for the oversupply-issue that has been dragging the commodity down. However with Brent Crude pushing to $52 per barrel, the commodity couldn’t enter this new week completely unscathed, as disappointing Chinese manufacturing data and refinery strikes in the US caused Brent to shed a dollar and settle into its familiar downward trajectory. With BP to announce major spending cuts in its earnings release tomorrow, last Friday’s boost may have been a minor blip rather than any kind of resurgence.
However, this oil news was largely positive for the FTSE, as its energy stocks revelled in the rare moment in the sun for the commodity, allowing the UK index an overall green open to the week. With analysts forecasting minor growth in the UK’s manufacturing PMI, the positivity should throw, as long as copper and oil don’t through a spanner in the works.
Copper managed to put some distance between the lows it was perilously near to reach $250 per pound on Friday; however, this morning has already seen a fall for the metal. Copper has looked rather sickly of late, and given the metal’s recent lack of resilience it appears unlikely it will be able to capitalise on its end of week gains as the day goes on.
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