Market Update 05/11/13

One line- Slow day in markets as investors look ahead to ECB meeting and non farm payrolls later in the week.

- US shares finished up yesterday with the S&P adding 0.4%, Asian stocks were broadly flat with the Nikkei adding 0.2%. In Australia the ASX 200 added 0.8% as the RBA left rates on hold at 2.5%. European stocks have begun up this morning ahead of the ECB meeting on Thursday and the US non farm payrolls on Friday. The report is expected to be soft and the ECB dovish so EUR/USD is trending down this week slipping 0.2%. Yields are flat along with industrial commodities. http://www.ft.com/cms/s/0/f1e78422-45c8-11e3-b98b-00144feabdc0.html?siteedition=uk#axzz2jfbJ2ffc

- Chinese Premier Li Keqiang has stated that to keep unemployment at a stable level of 4% the economy needs to grow at 7.2% per year. He took a hawkish view on inflation citing the fact that M2 in China exceeded twice the size of the country's GDP. China's economy is set to have its slowest rate of expansion in 23 years at 7.5%. http://www.reuters.com/article/2013/11/05/us-china-economy-idUSBRE9A403L20131105

- Half a year after the BOJ governor Kuroda released record monetary stimulus many economists see Japan failing to make their goal of 2% inflation by 2015. Just two of 34 analysts interviewed see the target being met in that time frame. Inflation in September from a year earlier was 0.7%. Real wages fell for a 16th straight month in September. The 3% increase in sales tax to be enacted next year is expected to cause an annualized 4% contraction in the second quarter of 2014.  http://www.bloomberg.com/news/2013-11-04/boj-struggles-to-convince-on-2-as-abenomics-shine-fades.html

- The US energy drilling boom is bringing down global prices for liquefied petroleum gas and is challenging established exporters in the Middle East. The shale revolution has turned the US from a large energy importer to an exporter of oil and gas. In the LPG market the US is vying for the number one production spot at 2 million barrels a day. http://uk.reuters.com/article/2013/11/04/us-energy-lpg-idUKBRE9A30G820131104

-Steve Cohen, arguably one of the best stock traders of all time, has admitted defeat and SAC has pleaded guilty to securities and wire fraud.  The firm agreed yesterday to stop managing money for clients and pay a fine of $1.8 billion dollars. The figure is a record fine for insider trading.  http://www.bloomberg.com/news/2013-11-05/cohen-s-dream-of-soros-status-dies-as-sac-pleads-guilty.html

Data

S&P 1767.93 0.36%

FTSE 6756.77 0.10%
Nikkei 14,225.37 0.17%

EUR/USD- 1.3488 0.19%
USD/JPY- 98.25 0.36%
GBP/USD- 1.5978 0.06%

Gold- 1315.07 0.08%
Oil (Brent)- 106.34 0.41%

Copper- 327.60 0.68%

 

 

10 year yields

US- 2.61 (+1bps)
UK- 2.64 (+2bps)
Japan- 0.59 (0bps)