17.10.14 Friday Morning

With the week now drawing to a close, markets are looking to regain some of their losses with all major bourses now trading in positive territory. In Friday Afternoon trading the Dow Jones has risen back above 16,400, approaching levels seen at the start of the week.

Investors will remember this week as being one of the most volatile periods of trading for at least 3 years as global economies begin to show signs of weaknesses which in turn resulted in markets plummeting dramatically, hurting many on the way down. A number of different factors have caused the recent sell-off from weakness fears in China and the US, negative sentiment coming from the eurozone and also as the end of the Federal Reserve’s Quantitative easing programme looms.

The sell-off began last week as data released showed signs of weakness amongst the world’s largest economies, however by Monday markets looked like they were beginning to calm, starting the week on a relatively positive note before retreating slightly into the red. It wasn’t until Monday evening that investors were hit by another wave of fear surrounding a global slowdown which caused the Dow Jones to drop significantly, stripping around 300 points off the Index to trade around the 16300 level.  A similar picture was seen in London with the FTSE 100 wiping almost £50bn off its value throughout the sell-off.

If investors weren’t already hurt enough, the sell-off continued in full force on Wednesday as a full house of negative data was released from America, again sparking even further worries surrounding their economy. Core Retail Sales came in at -0.2%, PPI at -0.1%, Retail Sales at -0.3% and Empire State Manufacturing Index fell to 6.2. As the data was made public, the Dow Jones dropped from around 16380 to hit intraday lows 15850, an eye-watering drop of nearly 500 points before the Index rebounded to stay above the key 16000 level.

Heading into Thursday, the investors who had managed to hold positions without being hurt were questioning when the sell-off was going to end.  With the Dow Jones now trading above 16100 after the rebound from Wednesday's drop, it seemed as though the end could be near with markets stabilising. However by mid-morning trading, major bourses once again fell dramatically, inflicting further damage on both the markets and its participants.

As lows were being hit on global bourses, hawkish Federal Reserve member Bullard spoke out saying that the Fed’s bond-purchasing programme should potentially continue longer than the October deadline. As his comments were digested, bourses rebounded as quick as they fell, ending the session relatively flat in a massive intraday swing.

The week ended with indicies regaining some of their lost ground as the FTSE 100 rose back above 6,300, the Dow above 16,400 and the Dax above 8,00.

Stock of the week: Shire -32%

AbbVie announced on Wednesday that the pharmaceutical giant were to reconsider its $54bn takeover for Shire – a move in which questions the logistics of the deal due to the new changes to the tax regulations by the US Department of Treasury’s. Large hedge funds are reported to have taken large positions in Shire; therefore the 32% drop in share price this week would have hit the hedge funds quite hard.

Economic calendar

Tuesday:

- CNY GDP
- CNY Industrial Production

Wednesday:

- GBP MPC Asset Purchase Votes
- GBP Official Bank Rate Votes
- USD Core CPI

Thursday:

- EUR French Flash Manufacturing PMI
- German French Flash Manufacturing PMI
- GBP Retail Sales
- USD Unemployment Claims

Friday:

- GBP Prelim GDP
- USD New Home Sales

Earnings calendar

Monday

- McBride PLC Q1 2015 McBride PLC Interim Management Statement Release 
- Rolls-Royce Holdings PLC Rolls-Royce Holdings PLC Medium Term Guidance Release

Tuesday

- Reckitt Benckiser Group PLC Q3 2014 Reckitt Benckiser Group PLC Interim Management Statement Release
- InterContinental Hotels Group PLC Q3 2014 InterContinental Hotels Group PLC Interim Management Statement Release
- ARM Holdings PLC Q3 2014 ARM Holdings plc Earnings Release
- William Hill PLC Q3 2014 William Hill PLC Interim Management Statement Release
- Go-Ahead Group PLC Go-Ahead Group PLC Interim Management Statement Release
- GKN PLC Q3 2014 GKN PLC Interim Management Statement
- Pentair PLC Q3 2014 Pentair PLC Earnings Release

Wednesday

- Petropavlovsk PLC Q3 2014 Petropavlovsk PLC Interim Management Statement Release
- Spirit Pub Company PLC Full Year 2014 Spirit Pub Company PLC Earnings Release
- Development Securities PLC Half Year 2014 Development Securities PLC Earnings Release
- Senior PLC Senior PLC Interim Management Statement
- Bhp Billiton PLC September 2014 Bhp Billiton PLC Operational Review
- Laird PLC Q3 2014 Laird PLC Interim Management Statement Release
- GlaxoSmithKline PLC Q3 2014 GlaxoSmithKline PLC Earnings Release
- Home Retail Group PLC Half Year 2014/2015 Home Retail Group PLC Earnings Release
- International Personal Finance PLC Q3 2014 International Personal Finance PLC Interim Management Statement

Thursday

- Unilever PLC Q3 2014 Unilever PLC Trading Statement Release
- Premier Foods PLC Q3 2014 Premier Foods PLC Interim Management Statement Release
- Hochschild Mining PLC Q3 2014 Hochschild Mining PLC Production Results
- African Barrick Gold PLC Q3 2014 African Barrick Gold PLC Earnings Release
- Bloomsbury Publishing PLC Half Year 2014 Bloomsbury Publishing PLC Earnings Release
- Reed Elsevier PLC Reed Elsevier Interim Management Statement
- Tesco PLC Half Year 2014/15 Tesco PLC Earnings Release
- Ladbrokes PLC Q3 2014 Ladbrokes PLC Interim Management Statement
- National Express Group PLC Q3 2014 National Express Group PLC Interim Management Statement Release
- Mecom Group PLC Mecom Group plc Interim Management Statement
- Debenhams PLC Full Year 2013/2014 Debenhams plc Earnings Release