Market Update 07/11/13

One line- Markets slow ahead of US GDP data and ECB decision.

- Stock markets are mixed ahead of the ECB meeting today and the US data release. The S&P finished up 0.4% the Nikkei sold off 0.8% while the FTSE is down 0.2% this morning. Industrial commodities are mixed with copper up while brent and gold are down. Currency movements are small and rates are virtually unchanged. The ECB decision on rates is due at 1245 and US third quarter GDP figures are released at 1330. The US is expected to have expanded 2% yoy while rates are expected to be held by the ECB. http://www.ft.com/cms/s/0/589c1a06-475a-11e3-b4d3-00144feabdc0.html#axzz2jrLA0UDC

- Australian employers cut full time workers in October by the most in more than a year sending the currency lower as traders expect rates to remain low. Part time employment increased and the employed showed a net increase of 1100 while the jobless rate of 5.7% remained steady. The RBA currently holds rates at 2.5%. http://www.bloomberg.com/news/2013-11-07/australian-employers-cut-full-time-jobs-in-october-aussie-drops.html

- China is facing huge demographic problems having doubled its life expectancy in 60 years and with a low fertility rate of 1.5. In 2011 its workforce shrank for the first time years before any predictions. Coupled with these problems is the fact that China is yet to be considered wealthy- per capita incomes are less than 20% of those in the US. http://www.ft.com/cms/s/0/2b6f8a7c-46d3-11e3-9c1b-00144feabdc0.html#axzz2jrLA0UDC

- Twitter's valuation has soared to $18 billion as investor interest pushed the company to price its shares at $26 slightly above the range it gave two days ago. Investors are anxious not to see a repeat of the Facebook float which was mired by technical problems and since then the company has failed to deliver. The proceeds of the IPO are expected to be used for acquisitions and expansion. http://www.ft.com/cms/s/0/bab738fe-4720-11e3-b4d3-00144feabdc0.html?siteedition=uk#axzz2jrLA0UDC

- Russia today acknowledged that its long term growth would lag global growth for the next 20 years. Predictions of the long run growth rate of the economy have been pushed down from 4% to 2.5% by the country's economic minister. http://uk.reuters.com/article/2013/11/07/uk-russia-economy-idUKBRE9A60C720131107

Data

S&P 1770.49 0.43%

FTSE 6727.95 0.20%
Nikkei 14,228.44 0.76%

EUR/USD- 1.3519 0.04%
USD/JPY- 98.71 0.05%
GBP/USD- 1.6075 0.04%

Gold- 1316.12 0.13%
Oil (Brent)- 104.49 0.71%

Copper- 324.00 0.09%

 

 

10 year yields

US- 2.64 (0bps)
UK- 2.71 (-1bps)
Japan- 0.58 (-2bps)