Spreadex Market Update
Greek bridge deal chances appear to increase
With the Ukrainian government confirming it was removing forces from violent hotspot Debaltseve, the scent of compromise from Syriza has washed away the negativity that had built up yesterday. The Greek government has confirmed they will submit a loan extension request, and whilst reports are suggesting the proposal is a little too light on actual data, the key parties involved seem hopeful for an agreement. Germany is apparently happy that Greece is willing to co-operate, despite some issues surrounding the details of the deal, whilst Jean-Claude Juncker has stated he is working with Jeroen Dijsselbloem to hammer out the all-important minutiae of a potential agreement. Signs of progress, however minor, are only a good thing for the markets, even if the proposed 6-month bridge would merely kick the actual issues into the summer.
Despite a strong open, impressive jobs data and a calmer situation in the Eurozone, the FTSE couldn’t capitalise on the positive sentiment on the continent. Wage growth figures were better than expected, as were jobless claims, whilst unemployment fell to 5.7%, a 6 year low; the FTSE’s oil and mining sectors also continued to post gains with Premier Oil and Vedanta continuing their recent impressive form. Yet losses by Royal Mail, Astrazeneca, Coca-Cola HBC and WH Smith hampered the UK index as the morning continued, whilst the current slide by Brent Crude only exacerbated the issue.
Like the FTSE, the US futures are struggling to enjoy the same rejuvenation the Eurozone indices are undergoing, despite a positive close yesterday. Forecasts are mixed for this afternoon’s US data: building permits are expected to increase, as is industrial production, whilst PPI is predicted to fall to -0.4%. The US will then see FOMC member Jerome H. Powell speak this evening; however, given the state of US data, he is unlikely to point to the interest rate hike some quarters are clamouring for.
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