Spreadex Market Update
US markets on course for second consecutive week of gains
The Dow Jones crossed 18000 for the first time in 2015, whilst the S&P reached its all-time highs in a very good open for the US markets. This was aided by better than expected import prices that also saw an upward revision for last month. However, a decline in the preliminary University of Michigan consumer sentiment figure slightly dampened spirits, despite 93.6 still being a respectable figure, especially considering the fall in US retail sales on Thursday. Regardless the US markets are still on track for a second consecutive week of gains, a first since the New Year.
The FTSE had one foot in Valentine’s day, as the index spent Friday all loved up with its mining and oil sectors. Both Premier Oil and Tullow Oil had very strong days, especially in comparison to their situation at the start of the week, whilst Vedanta Resources was the big winner as it gained nearly 12% after Morgan Stanley upgraded its rating. This was as Brent Crude traded at around $61 per barrel; it has shown resilience of late, recovering from the midweek declines that many saw as a return to the dismal form that has plagued the commodity since October last year.
However, despite the overall positivity in the sector, Afren’s situation turned sour yet again, as the company’s board refused to extend Seplat’s bid deadline. This caused the stock to once more plunge into the abyss after spending the past 2 weeks yo-yoing up and down the charts. This decline will be harder to recover from than its other precipitous falls as investors no longer have the hope of Seplat riding in, white-knight style, to save the day.
Finally, after the flurry of European GDP figures this morning the region quietened down in terms of news, as focus turns to Monday’s Greek-debt deadline. Whilst the Greek markets displayed hope that a deal will be found soon, Jean-Claude Juncker stomped all of these dreams by stating that Greece is still far away from an EU-agreement. Things weren’t helped, at all, by Yanis Varoufakis comparing the Troika’s actions to the CIA waterboarding people; comments like these don’t suggest a harmonious and comprise-ready mood before Monday.
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