Good Morning,


Trading for most European indices wasn’t pleasant on the last day of June. The Euro Stoxx 50 was marginally up by 0.01% to end the first half of 2013 at 3228.24 whilst the German DAX added 0.18% to end the day’s trading at 9833.07. Meanwhile the French CAC 40 and the FTSE 100 ended the second quarter of the year in the red, dropping 0.32% and 0.2% to close at the 4422.84 and 6743.94 levels respectively.

There have been growing concerns in relation to the increasing strength of the Euro Currency which Mario Draghi, the President of the ECB believes is “a serious concern” especially when the deposit rate held by the ECB was only recently slashed to -0.1%. The currency has been climbing against the Euro for almost two-years.


The majority of US indices followed in the tracks of European indices to end trading in the red at the end of June. Both the Dow Jones Industrial Average and the S&P500 ended the trading in lower territory. The DJIA shaved off 0.15% to end trading at 16826.60 whilst the S&P500 slipped marginally by 0.04% to end the day at 1960.23. Meanwhile the NASDAQ registered positive levels of trading, ending the day 0.23% higher than its open, to close at 4408.18. One must highlight that trade volume in the first half of the session was also significantly low. Trading in treasuries was significantly flat yesterday.

Data on pending home sales in the US was also published yesterday. This increased by 6.1% over April’s revised upward reading, recording the highest month over month gain in over four years, signalling improvements in the residential market. However when compared to the previous year, the recorded number was still lower by 5.2%. However, all in all, the recent data is showing signs of improvement in the home-sales conditions after the slide in winter. The housing data published did beat expectations of analysts and this helped offset the effects of weaker than expected manufacturing data.

Further data issued by the Chicago Business Barometer showed a drop in its reading to 62.6 from May’s index reading of 65.5. This reading was also below economists’ expectations. Also, a gauge of world equities showed an advance of 1.7% in June. This is the fifth straight monthly gain and the longest streak since 2007.

One must keep in mind that the highly anticipated employment figures will be out on Thursday this month rather than Friday, given that Friday will be a holiday in the US.


A second default scenario in 13 years may be on the horizon again for Argentina as the nation begins its 30-day grace period after missing a debt payment of $539 million. On the 16th of June, the U.S Supreme Court did not change the ruling it had previously enforced which required Argentina to pay previous defaulted bondholders the approximate amount of $1.5 billion which left the sovereign with no choice but to settle its dues. This, however, was not forthcoming. Investors will definitely be looking out for new developments which may have significant effects.

Have a great day,