Spreadex Market Update
Global indices continue to surge as Brent Crude touches $36 per barrel, but miserly US Q4 GDP reading looms on the horizon
Currently, at least, the Dow Jones is joining in with its galloping European peers, the futures promising a 110 point rise when the bell rings on Wall Street, something that would leave the index at its highest point since the first week of January. Yet the spectre of this afternoon’s latest fourth quarter GDP reading may temper investors’ enthusiasm, analysts forecasting a downward revision from an already awful annualised 0.7% to 0.4%. This drop might be mitigated by the expected improvements in the core PCE price index, the goods trade balance, personal spending and income, and the UoM consumer sentiment figure; however, the GDP number is unavoidably in the spotlight, and may well cause a shift in sentiment as the day continues.
Despite the continued collapse of the Royal Bank of Scotland (which is circling 3 and a half year lows) the FTSE remained at a 4 week high this Friday, Brent Crude’s latest rebound ensuring an emerald green morning from its all-important commodity stocks.
The Eurozone indices were even more muscular, the DAX and CAC up roughly 2% apiece even as a slide in the region’s economic sentiment slipped to 103.8 from 105.1 last month, joining the morning’s earlier inflation disappointments from France and Spain. Yet with the March ECB meeting barrelling towards us any negative data from the Eurozone is being taken as further justification for an extra injection of central bank stimulus, and as we have seen in the last couple of years, nothing gets investors more excited than the promise of Mario Draghi busting open his big ol’ box of QE.
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