Spreadex Market Update
FTSE down in early trading
The FTSE found itself down in early trading following a fall of over 1% in Asian markets overnight as a result of a downward revision of Chinese growth targets.
The Chinese premier, Wen Jiabao, announced the decision to cut China’s growth target to its lowest rate since 2004 at 7.5% as the government seeks to move away from exports and investments towards domestic consumption and reshape development in the ever expanding economy.
Services PMI data from China also out Monday reported China’s services sector ran at its fastest pace in four months in February, however despite this service providers reported only a modest rate of job creation and again expressed below-trend confidence about the short term business outlook.
This differed to the official Chinese services PMI out on Saturday which signalled a contraction of the sector.
Unsurprisingly Resources companies find themselves amongst the biggest fallers following the data with Rio Tinto, Vedanta Resources, Kazakhmys and Cairn Energy to name a few finding themselves at the bottom of the list. Weir Group, the engineering firm which services the Mining, Oil & Gas sectors is also down over 3% following the news on top of a reduction in price target to 1830p from 1950p.
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