Spreadex Market Update
US futures flats as they wait for potentially dismal GDP figure
After last quarter’s figure was revised down to 2.2%, analysts are expecting a big drop for 2015’s first quarter, with forecasts suggesting a dismal 1% in growth. Unsurprisingly, ahead of this news the US futures are incredibly flat as investors wait and see whether the US GDP can beat the weak predictions. Beyond this GDP figure will be the outcome of the Federal Reserve’s 2-day meeting; following yesterday’s disappointing consumer confidence figures, and the expectation of dismal GDP data, the chances of a September rate hike looks increasingly unlikely as the US continues to release the softest of soft data.
Despite the Eurozone beating its M3 money supply expectations, missed targets in region wide economic sentiment and consumer confidence damaged the area’s indices and saw them lose their morning gains. Even news that the long awaited Greek reforms list could be presented at some point today was dampened by the fact that the ECB has raised the ELA cap for Greek banks by €1.4 billion, another expensive olive branch that has still failed to yield any signs of compromise on the side of the receiver.
The FTSE has fallen away from the levels it saw at today’s open with a double whammy hit of disappointing consumer news; consumer confidence fell for the first time since last December, whilst CBI realized sales index abruptly fell short, coming in at 12 instead of the forecast 26.
Things were exacerbated by declines in Brent Crude and copper which took with them BP and Rio Tinto respectively, with losses also seen by Antofagasta, Premier Oil and Ophir Energy. Things could become worse this afternoon with the release of the latest US crude oil inventories; last week saw the figure creep back up to 5.3 million barrels after the respite of 1.3 million the week before. Forecasts are pointing to 2.1 million barrels this week, but analysts have been notoriously scattershot in their estimates for this figure since the oil-price crisis began.
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