Spreadex Market Update
Eurozone GDP continues to boost markets
After the excellent figures coming out of Germany this morning, a flat Italian GDP was followed by better than expected figure for the region as a whole, with the Eurozone reaching 0.9% growth for 2014. However, unsurprisingly, Greek GDP fell by 0.2% in the fourth quarter as election uncertainty rattled the country; this isn’t the best news ahead of the debt-talk-dead line on Monday, with a Syriza-led country appearing weak when compared to its European neighbours. Yet this news didn’t bother the DAX, which is set to break the all-time high it had only just hit yesterday.
Brent Crude spent the morning solidifying the $60 per barrel level it reached after the bell, and this news was music to the FTSE’s ears. With Afren, Tullow Oil and Premier Oil all posting gains, sustained growth for copper also caused Vedanta and KAZ Minerals to maintain the bullish trading they began yesterday afternoon. The cherry on the top was a flurry of positive ratings for big-pharma mainstay GlaxoSmithKline, as the drug giant reached 4% in growth as the day went on. With no news of its own to throw a spanner in the works, all the FTSE needs is stasis on the continent and continued growth in commodities for a strong end to the week.
Yesterday’s bullish sentiment was especially buoyant for the Dow Jones and S&P, which hit their 2015 highs off the back of goods news from Europe. The futures are pointing to similar gains this afternoon, as the global markets continue to recover the losses incurred at the start of the week. After ignoring Thursday’s weak unemployment change and retail sales numbers, the US markets displayed some of the resilience they had gained at the end of 2014, a resilience that has been lost somewhat amongst the deluge of disappointing data in 2015. It will be tested once more this afternoon, as the preliminary UoM consumer sentiment is released; it will be interesting to see if the oil-inspired strength in this consumer index can be sustained, as it provides a boost to the hawks in regards to raising US interest rates.
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