Market Update 18/11/13

One line- Slow day in the markets generally except for China where the announcement of upcoming social reform is causing strong positive sentiment. 

- Chinese equities are pushing higher in reaction to the Chinese Communist Party's pledge to loosen social controls and to phase out state-controlled prices. The FTSE all world index is trading at a high not seen since late 2007. The Hang Seng added 2.9% while other equity markets are broadly flat. Commodities are broadly lower while FX markets are generally quiet. Asian currencies have experienced a boost from the China news with the yen and aussie dollar strengthening 0.2% and 0.5% against the dollar respectively.  http://www.ft.com/cms/s/0/2e62edf2-4fff-11e3-8e99-00144feabdc0.html?siteedition=uk#axzz2kzQ4lqxa

- While the BOJ is expected to keep its monetary stimulus constant on Thursday weak exports and an inability to create meaningful inflation is creating speculation over further monetary easing in 2014. Analysts will be looking very closely at this meeting for any hints of further monetary easing. http://uk.reuters.com/article/2013/11/18/uk-japan-economy-boj-idUKBRE9AH04520131118

- The Federal Reserve is considering allowing another year for banks to implement changes to comply with the Volcker rule. Banks currently have to comply by July 2014 but regulators are still making changes to the proposal which is expected to be released at the earliest in December, giving banks less than a year to make changes. The Volcker rule includes provisions that banks cannot make any proprietary trades and looks to curb overall risk taking in banks. http://www.ft.com/cms/s/0/6454dae4-4fad-11e3-b06e-00144feabdc0.html#axzz2kzQ4lqxa

- Netanyahu is rallying against a proposed Iranian deal to lift sanctions dependent on restrictions being imposed on the country's nuclear programme. France's Hollande has pledged his support for Netanyahu's position that the restrictions on the nuclear programme do not do enough to prevent the country from creating a nuclear bomb. Relations between Obama and Netanyahu have always been strained and their inability to see eye to eye on this issue further extends the rift which has been developing. http://uk.reuters.com/article/2013/11/17/us-iran-nuclear-idUKBRE9AG0DP20131117

Data

S&P 1798.18 0.42%

FTSE 6704.48 0.16%
Nikkei 15,164.30 0.01%

EUR/USD- 1.3512 0.12%
USD/JPY- 99.94 0.25%
GBP/USD- 1.6114 0.02%

Gold- 1283.92 0.49%
Oil (Brent)- 108.10 0.37%

Copper- 317.50 0.22%

 

 

10 year yields

US- 2.70 (0bps)
UK- 2.76 (+2bps)
Japan- 0.64 (+1bps)