Tuesday, 19 May 2015

Daily Market Analysis 19.05.2015

On Monday, stocks were mixed globally as Greece continues to weigh on investor sentiment. Traders are also looking to the upcoming Federal Open Market Committee minutes due on Wednesday.

At the London afternoon fixing, gold increased $3.00 to $1223.50, and copper futures decreased 0.7% to $2.90. In oil, Dated Brent spot crude dipped $0.40 to reach $66.41. WTI spot crude inched up $0.03 to reach $59.72.

The Dollar Index advanced 1.0% as the USD rose against the EUR, JPY, GBP, CHF, CAD and AUD.

United States Equities
Stocks in the US market gained on Friday. US home builder sentiment was down in May although most builders believe current market conditions are favorable according to the National Association of Home Builders. The Dow Jones industrials added 0.1%, the S&P increased 0.3% while the Nasdaq jumped 0.6%.

Apple rallied after activist investor Carl Icahn increased his price target on the stock by 11%. Endo International slumped after agreeing to buy Par Pharmaceutical Holdings from private equity firm TPG for approximately $8 billion in cash and stock. Eleven Biotherapeutics was down after announcing that its late stage dry eye disease treatment did not meet two primary targets.

European Equities
Over in Europe, equities markets tumbled due to late session sell-off in European bonds. Discouraging US economic data also drove the markets further down.

The London FTSE rose 0.1%, the French CAC added 0.4% and the Spanish Ibex rose 0.2%. The German DAX finished 1.3% higher while the Swiss SMI gained 1.0%. The Italian MIB was down 1.2%.

In terms of individual stocks, Volkswagen, Daimler, BMW, Renault and Peugeot all edged up. Fresenius, Fresenius Medical Care, Bayer and Merck all advanced. Crédit Agricole, Société Générale and BNP Paribas all lost. Lloyds Banking Group declined on a broker downgrade. Babcock International gained after reporting increased profit for the year. Royal Mail was up following a broker upgrade.

Asia Pacific Equities
Equities markets in the Asia Pacific region were mixed due to lackluster US data and a downturn in the Chinese real estate market. In China, the Shanghai Composite slipped 0.6% while the Hong Kong Hang Seng lost 0.8%.

In Japan, the Nikkei added 0.8%. Dai-ichi Life Insurance climbed. Mitsubishi UFJ Financial , Mizuho Financial and Sumitomo Mitsui Financial Group all gained. Honda increased following the launch of its latest Honda Shuttle model. Softback, which holds a 32.59% stake in Chinese e-commerce company Alibaba Group Holding gained. French luxury goods company Kering SA, parent company of Yves Saint Laurent and other luxury brands, filed a lawsuit against Alibaba Group for enabling the sales of counterfeit models of its products.

In Australia, the S&P/ASX lost 1.3% while the All Ordinaries finished 1.2% lower.

Macro Themes and Looking Ahead
The UK will be releasing April consumer and producer price indices. The Eurozone will report final harmonized index of consumer prices for April and March merchandise trade balance. Germany will be posting May ZEW survey.

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