Monday, 13 April 2015

Daily Market Analysis 13.04.2015

Global stock indices increased in response to recent corporate deals and the People's Bank of China's possible easing of its monetary policy.

At the London afternoon fixing, gold increased $12.55 to $1207.55, and copper futures were up 0.2% to reach $2.73. In oil, Dated Brent spot crude increased $1.30 to reach $57.87. WTI spot crude rose $0.85 to reach $51.64.

The Dollar Index increased 0.5% as the USD increased relative to the EUR, GBY, CHF and AUD. However, it dropped relative to the JPY and CAD.

United States Equities
Stocks in the US peaked encouraged by recent corporate deals. After the release of a lackluster March jobs report on April 3, investors believe that the Fed will postpone interest rate hikes until September instead of the original June target. The Dow Jones industrials jumped 0.6%, the S&P added 0.5% and the Nasdaq rose 0.4%.

General Electric peaked after the company announced that it would sell most of its GE Capital and focus on its industrial business. Citrix Systems lost after cutting its first quarter profits due to a declining US dollar. Gap finished lower after stating that its March same store sales rose more than expected following strong sales at Old Navy.

European Equities
Over in Europe, equities markets rallied for the day and week. Investor sentiment was raised after Greece repaid a €450 million loan to the International Monetary Fund (IMF) on Thursday.

The London FTSE was up 1.1%, the French CAC gained 0.6%, the German DAX advanced 1.7%, while the Swiss SMI increased 0.8%. The Italian MIB and Spanish Ibex edged up 0.3% and 0.1% respectively.

In terms of individual stocks, Deutsche Post was up on a broker upgrade. Fresnius, Fresnius Medical Care, Bayer and Merck all gained. Vedanta Resources declined after fourth quarter oil and gas production declined from last year. ITV reached a I5-year high following a broker upgrade. Mining stocks including Anglo American, Glencore and Rio Tinto tumbled due to a drop in iron ore prices.

Asia Pacific Equities
Equities markets in the Asia Pacific mainly ended higher as a result of expected easing by the People’s Bank of China. In China, the Shanghai Composite increased 1.9%, while in Hong Kong the Hang Seng index was up 1.2%. In Japan, the Nikkei decreased 0.2%. In Australia, the S&P/ASX 200 and the All Ordinaries increased 0.2%.

Macro Themes and Looking Ahead
China will be posting March merchandise trade balance. Japan will release February machine orders and March producer price index. The US Treasury budget will be released.

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