ETX Capital Daily Market Bite, 31st January, 2013: Weakess For Markets On Last Trading Day Of Month
January 31, 2013 10:26 am
January 31st, 2012, Daily Market Bite from Ishaq Siddiqi Market Strategist
European stock markets are trading weaker on the last day of a spectacular month for risk assets due to losses on Wall Street overnight, sparked by an underwhelming US 4Q GDP report and uneventful but as expected Fed policy meeting. The Fed kept rates and QE measures unchanged, still buying bonds as long as unemployment and inflation are not in line with the central bank’s target. Although the outcome was largely expected, the first policy meeting of 2013 has prompted concerns about the Fed’s ballooning balance sheet – a theme which is likely to persist through the year. In Europe, a deluge of major blue-chips have reported so far and are likely to keep investors busy through the course of the session until we see US corporate earnings hit the wire. As it is the last trading day of a solid month, we are likely to see a degree of window dressing – February carries more risks than January such as the US budget battle and Italian elections and these fears are being reflected by the slight uptick in peripheral bond yields. We also have a wealth of economic data from both sides of the Atlantic which is likely to influence price action – look out for German unemployment and inflation figures together with euro zone harmonized inflation. Stateside, Wednesday’s dull growth figures will see investors approach data with trepidation; look out for weekly jobless claims and Chicago PMIs.
January 31st, 2012, Daily Market Bite from Ishaq Siddiqi Market Strategist
European stock markets are trading weaker on the last day of a spectacular month for risk assets due to losses on Wall Street overnight, sparked by an underwhelming US 4Q GDP report and uneventful but as expected Fed policy meeting. The Fed kept rates and QE measures unchanged, still buying bonds as long as unemployment and inflation are not in line with the central bank’s target. Although the outcome was largely expected, the first policy meeting of 2013 has prompted concerns about the Fed’s ballooning balance sheet – a theme which is likely to persist through the year. In Europe, a deluge of major blue-chips have reported so far and are likely to keep investors busy through the course of the session until we see US corporate earnings hit the wire. As it is the last trading day of a solid month, we are likely to see a degree of window dressing – February carries more risks than January such as the US budget battle and Italian elections and these fears are being reflected by the slight uptick in peripheral bond yields. We also have a wealth of economic data from both sides of the Atlantic which is likely to influence price action – look out for German unemployment and inflation figures together with euro zone harmonized inflation. Stateside, Wednesday’s dull growth figures will see investors approach data with trepidation; look out for weekly jobless claims and Chicago PMIs.
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