Weekly Trading Update
20.06.14 Friday Evening
Global shares started the week on mixed grounds as the crisis in Iraq began to take hold of markets. As normal in times of crisis, commodity prices rallied as a ‘safe-haven’ for investors was sought after. The price of gold was seen hitting new high levels this week after it smashed through the $1300 level, posting the biggest daily rise in over 9 months on Thursday. Oil prices were dramatically impacted by the Iraq crisis throughout the week, hitting highs of above $114 per barrel as a potential shortage of the commodity was priced into the market.
Volatility in markets began to increase on Tuesday as the first important bout of macroeconomic data was released for the week. UK inflation fell to 1.5% in May to a four year low, directly impacted by low food prices and the drop in air fares. The drop was limited by an increase in petrol prices between April and May however the CPI figure is still below the Bank of England’s 2% price target.
Markets headed into mid-week trading on a mixed note as markets priced in risk ahead of the Federal Open Market Committee statement and press conference which happened later in the evening. As expected, investors were correct in thinking Janet Yellen would announced a further $10bn taper to the monthly bond purchasing programme whilst she also delivered an upbeat and dovish speech overall.
Global markets reached new record highs as Yellen delivered the statement once investors had time to digest the information released. Positive sentiment continued to flow in markets on Thursday after the statement with markets advancing further. The Dow Jones is currently just off the benchmark 17000 level which the bulls will be looking to break in the very near future whilst the S&P 500 continues to break record levels; currently trading around 1960.
Stock of the week – Shire PLC
Shire has taken the limelight this week as shares in the company rocketed 13% on Friday morning as they confirmed they had rejected an offer from AbbVie as they said it undervalues the company. Chairwoman Susan Kilsby said: "The Board believes the proposal fundamentally undervalued Shire and its prospects and that as an independent company Shire's focused growth strategy will continue to deliver significant shareholder value and patient benefits".
Open (Monday)
6761.8
Close (Thursday)
6808
Change
0.68%
High
6840
Low
6734
Open (Monday)
16744
Close (Thursday)
16921.5
Change
1.01%
High
16921.5
Low
16729
Open (Monday)
1283
Close (Thursday)
1318
Change
2.72%
High
1322
Low
1259
Open (Monday)
1.6987
Close (Thursday)
1.7038
Change
0.30%
High
1.7062
Low
1.6922
Economic Calendar
Monday 23 June
- EUR French Flash Manufacturing PMI
- EUR German Flash Manufacturing PMI
- USD Existing Home Sales
Tuesday 24 June
- EUR German Ifo Business Climate
- USD New Home Sales
Wednesday 25 June
- USD Core Durable Goods Orders
Thursday 26 June
- BOE Gov Carney Speaks
- USD Unemployment Claims
Friday 27 June
- EUR German Prelim CPI
Earnings
Monday 23 June
- Polar Capital – Prelim Earnings
- Debenhams – Interim Management Statement
Tuesday 24 June
- Chemring Group – 2014 Interim Earnings
- Carnival PLC – Q2 Earnings Release
Wednesday 25 June
- Northgate – Prelim Earnings
Thursday 26 June
- DS Smith – FY Earnings
- Standard Chartered – Q1 Trading Update
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