ETX Capital Daily Market Bite, 11th June, 2013: European Markets Dip Before Data; BOJ Holds Steady
June 11, 2013 10:46 am
June 11th 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
Hesitant financial markets this morning after the Bank of Japan refrained from boosting stimulus measures, leading the Nikkei to slip 1.4%. The rest of Asia traded lower overnight but shares on Wall Street Monday were supported by S&P raising the US to stable from negative but maintaining the AA+ rating on the country. Asian markets have benefited from easy Fed cash over the years so signs of an improving US economy (which would prompt the Fed to unwind stimulus) weighed in Asian markets are subsequently pressuring European markets this morning.
The FTSE100 is off around 42 points at the moment while the EUROSTOXX 50 index is down by 26 points. In focus this morning, Greece’s market fell sharply in the previous session after it failed to sell off its state owned gas monopoly Depa. This failure undermined confidence in the government’s ability to attract interest for a host of assets which Greece needs to get rid of in order to meet the EU’s privatization targets before year-end. Greek 10-year bond yields rose 31 basis points to 9.7%.
Attention now turns to the German constitutional court’s 2-day hearing on the ESM case and the court will also review the ECB’s OMT programme. Though no ruling is expected until after the German elections in September, judges discussing the ESM will be on interest for markets and though the court can’t force the ECB to end its OMT programme, it’s possible the court could place restrictions on the OMT’s functionality. The Buba’s Weiddman will be attending the ruling and he is known to be critical of ECB monetary policy. Any discussions over the legality of the OMT will surely steal the spotlight.
Tensions in Turkey have escalated with serious clashes between protestors and Turkish riot police in Taksim Sqaure. Riot police moved into the square in Istanbul wearing gas masks and firing tear gas and water cannons. Turkish markets are extremely volatile at the moment with the lira remaining below 1.89 but the Borsa Istanbul-100 up around 1.9%, helped by a strong GDP out of Turkey. Looking ahead to the rest of the day, other than the German court ruling, we have UK manufacturing and industrial output data and US wholesale inventories.
June 11th 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
Hesitant financial markets this morning after the Bank of Japan refrained from boosting stimulus measures, leading the Nikkei to slip 1.4%. The rest of Asia traded lower overnight but shares on Wall Street Monday were supported by S&P raising the US to stable from negative but maintaining the AA+ rating on the country. Asian markets have benefited from easy Fed cash over the years so signs of an improving US economy (which would prompt the Fed to unwind stimulus) weighed in Asian markets are subsequently pressuring European markets this morning.
The FTSE100 is off around 42 points at the moment while the EUROSTOXX 50 index is down by 26 points. In focus this morning, Greece’s market fell sharply in the previous session after it failed to sell off its state owned gas monopoly Depa. This failure undermined confidence in the government’s ability to attract interest for a host of assets which Greece needs to get rid of in order to meet the EU’s privatization targets before year-end. Greek 10-year bond yields rose 31 basis points to 9.7%.
Attention now turns to the German constitutional court’s 2-day hearing on the ESM case and the court will also review the ECB’s OMT programme. Though no ruling is expected until after the German elections in September, judges discussing the ESM will be on interest for markets and though the court can’t force the ECB to end its OMT programme, it’s possible the court could place restrictions on the OMT’s functionality. The Buba’s Weiddman will be attending the ruling and he is known to be critical of ECB monetary policy. Any discussions over the legality of the OMT will surely steal the spotlight.
Tensions in Turkey have escalated with serious clashes between protestors and Turkish riot police in Taksim Sqaure. Riot police moved into the square in Istanbul wearing gas masks and firing tear gas and water cannons. Turkish markets are extremely volatile at the moment with the lira remaining below 1.89 but the Borsa Istanbul-100 up around 1.9%, helped by a strong GDP out of Turkey. Looking ahead to the rest of the day, other than the German court ruling, we have UK manufacturing and industrial output data and US wholesale inventories.
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