Spreadex Market Update
Latest Greek failure weights on markets
Yesterday saw the latest failure in regards to securing some kind of economic reform agreement between Greece and its increasingly testy creditors. This stagnation is rapidly leaving Greece up penniless creek without a paddle, and the markets reacted accordingly; the DAX slipped into marginal losses, despite better than expected retail sales figures, whilst the rest of the region followed the lead of its headline index. Things were worse for the euro, with fresh stirrings of a ‘Grexit’ playing havoc with the already weakened currency, pushing it even lower against a dollar that is more than willing to take advantage.
Yet there is hope for the Eurozone this morning: region-wide inflation data is expected, and following a positive figure from Germany yesterday, this area could be cause for tentative celebration and a subsequent market upswing; similarly, the Eurozone’s unemployment rate has been incrementally falling over the past few months, so the further erosion of this figure could inspire some positivity in the region.
The FTSE opened flat this morning, as divergent voices battled to be heard. The fact that UK consumer confidence just hit a 12 year high in March provided some reason to be positive; however, the weight of the unstable Greek situation alongside the UK’s own election uncertainty means that it looks like the FTSE is going to have another limited day, even if it does manage to break into some gains as Tuesday continues. If this is to happen then the index will need to see strong current account and final GDP figures later this morning.
Despite a second day of fairly disastrous news, UK retailer Kingfisher has continued to see big gains as investors were impressed by the steps taken to reverse the company’s fortunes. After yesterday’s Mr. Bricolage deal-collapse, Kingfisher then announced this morning a 7.5% decline in annual profit to cap off a string of weak earnings releases throughout 2014. However, the news that the company’s relatively new boss, Veronique Laury, is to close 60 of its B&Q stores in the UK showed real intent to take the necessary steps to pull Kingfisher out of the red, leading to over 4% in gains on the markets.
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