ETX Capital Daily Market Bite, 12th August, 2013; European Markets Edge Up Despite Poor Japan GDP
August 12, 2013 7:06 am
August 12th, 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
Stocks posting slim gains here in Europe. A mixed session in Asia with Japan’s Nikkei dropping but Chinese stocks advancing give investors little firm direction in Europe. Japan’s GDP fell short of expectations for the 2Q, in at 2.6% on an annualised basis versus expectations of 3.6%. Business investment declined unexpectedly by 0.1% while consumer spending rose around 0.8%. The GDP figure for 1Q was revised lower also, to 0.9% from 1.0% previously.
The figures come at a time when the government in Japan is debating over a sales tax hike which may be held back now due to the poor number. The sales tax hike is an essential feature of Japanese PM Shinzo Abe’s three-arrow measures to spur economic growth in the country, so a delay in resolving this worries the market about the effectiveness of “Abenomics.” Japan’s Nikkei 225 finished 0.7% lower while the yen rose sharply.
Chinese markets hit a 7-week high, propped up on mounting hopes that policymakers in the country will support the economy there by providing a stimulus by channelling cash to state-owned banks in order to juice up lending. Metal prices have rallied; gold is up around 17 bucks while silver and copper also register some decent gains. USD is firmer against rivals as Federal Reserve tapering talk continues to underpin market sentiment following last week’s upbeat run of economic data from the US and four FOMC members throwing their weight behind tapering stimulus by next month.
Back to Europe, subdued session so far with little in the way of corporate and economic news to incentivise the market. Seasonal volumes noted as many are still away on holidays. Earnings season from both sides of the Atlantic is also wrapping up this week. The market is now gearing up for some of the big economic releases this week which should provide further insight into the health of the global economy.
From the UK, we have inflation figures out on Tuesday and unemployment data together with the BOE’s meeting minutes on Wednesday. From the euro zone, look out for Germany’s ZEW survey on Tuesday and GDP figures for the region, due Wednesday. From the US, retail sales are due Tuesday and industrial output is scheduled for Thursday. Philly Fed and Michigan confidence also eyed, both due later in the week.
August 12th, 2013, Daily Market Bite from Ishaq Siddiqi Market Strategist
Stocks posting slim gains here in Europe. A mixed session in Asia with Japan’s Nikkei dropping but Chinese stocks advancing give investors little firm direction in Europe. Japan’s GDP fell short of expectations for the 2Q, in at 2.6% on an annualised basis versus expectations of 3.6%. Business investment declined unexpectedly by 0.1% while consumer spending rose around 0.8%. The GDP figure for 1Q was revised lower also, to 0.9% from 1.0% previously.
The figures come at a time when the government in Japan is debating over a sales tax hike which may be held back now due to the poor number. The sales tax hike is an essential feature of Japanese PM Shinzo Abe’s three-arrow measures to spur economic growth in the country, so a delay in resolving this worries the market about the effectiveness of “Abenomics.” Japan’s Nikkei 225 finished 0.7% lower while the yen rose sharply.
Chinese markets hit a 7-week high, propped up on mounting hopes that policymakers in the country will support the economy there by providing a stimulus by channelling cash to state-owned banks in order to juice up lending. Metal prices have rallied; gold is up around 17 bucks while silver and copper also register some decent gains. USD is firmer against rivals as Federal Reserve tapering talk continues to underpin market sentiment following last week’s upbeat run of economic data from the US and four FOMC members throwing their weight behind tapering stimulus by next month.
Back to Europe, subdued session so far with little in the way of corporate and economic news to incentivise the market. Seasonal volumes noted as many are still away on holidays. Earnings season from both sides of the Atlantic is also wrapping up this week. The market is now gearing up for some of the big economic releases this week which should provide further insight into the health of the global economy.
From the UK, we have inflation figures out on Tuesday and unemployment data together with the BOE’s meeting minutes on Wednesday. From the euro zone, look out for Germany’s ZEW survey on Tuesday and GDP figures for the region, due Wednesday. From the US, retail sales are due Tuesday and industrial output is scheduled for Thursday. Philly Fed and Michigan confidence also eyed, both due later in the week.
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