Good Morning.


European markets were significantly lower at the close of yesterday’s trading. The Euro Stoxx 50 fell 1.28% to close at 3,091.52 whilst the DAX and the CAC 40 slid 1.77% and 0.89% to close at 9,173.71 and 4,345.35 respectively. This negativity was affected German confidence data which missed forecasts anticipated by economists. The investor confidence index as calculated by the ZEW Center for European Economic Research fell to 43.2 from 46.6. A reading of 45 was expected. This was the fourth consecutive monthly slide.

The sell off was also certainly influenced by news reports stating that Russian troops had entered the eastern towns of Slovyansk and Kramatorsk in Ukraine. Deaths were also reported, fuelling further fears of civil unrest within the country. European equities are also being affected by the threat of costly sanctions against Russia.

Spanish Economic data on export growth is expected to be released today. Spanish exports to countries outside the EU fell 0.8% in February. The country’s export figures are being put under pressure as a result of the Euro’s current price. The Euro exchange rate has depressed consumer prices, threatened its export-based recovery and continued to put pressure on its already high unemployment level.

New laws which will reform the Eurozone’s banking sector were approved yesterday. These laws will complete a ‘banking union’ which will protect European taxpayers from future bailouts. The new rules introduce a ‘bail-in’ process in which the shareholders and creditors will face the costs of any mistakes made by the bank.

The Euro Stoxx 50 is expected to open in positive territory this morning on the back of positivity seen in Asian markets overnight. A higher close later this afternoon may wipe away some nervousness investors have experienced over the past week.


The major indices in the US were volatile throughout yesterday’s trading. At the close however, the S&P 500 was up 0.68% closing at 1,842.98 whilst the Dow Jones added 0.55% to close at 16,262.56. The Nasdaq index also saw a marginal increase of 0.29% to close at 4,034.16. Treasuries were in positive territory as well pushing the yield on the 30-year bond to 3.46%, shedding three basis points. The volatility in the indices may be an indication of investors’ nervous sentiment ahead of earnings.

US economic data relating to the Consumer Price Index was also reported yesterday. The reading for March stood at 0.2% which was higher than the expected 0.1%. This increase was mainly influenced by costlier food and rent. This may signal that demand is improving within the US. The inflation report published also shows that the core gauge for inflation, which excludes volatile food and fuel costs, also rose 0.2% in March. A 0.1% gain was expected. Year-on-year, this reading has increased by 1.7% by March. Furthermore, US home-builder confidence fell 0.6% as measured by an S&P Index of homebuilders.


A report issued yesterday signalled a weaker than expected growth in the money supply of the Chinese currency. Overnight, GDP statistics were issued. This was also weaker than previous readings. In the first quarter of 2014, the Chinese economy grew 1.4%, 0.3% lower than the previous quarter. This extended slowdown in GDP figures may add pressure on the Chinese Premier to increase economic stimulus. On the other hand, the readings for employment and income levels show growth in the quarter. According to a spokesman for the statistics bureau, China created 40,000 more jobs when compared to the same period last year. Furthermore, the home sales indicator fell 7.7% in the first three months of this year, whilst new property construction was also down 25%.

Have a good Day,