Risk appetite has had a shaky 24 hours as weak European PMI data yesterday was followed up by renewed concern about the political situation in Greece. Late yesterday, Prime Minister George Papandreou held a cabinet meeting in which his plans for a referendum were endorsed; however it is by no means guaranteed that this government will survive that long. Dissent amongst the ruling PASOK party has been growing since the summer (when further austerity measures were voted through), and defections to the opposition are becoming a daily occurrence.
Against this backdrop of Eurozone uncertainty, the uncomfortable demise of MF Global has weighed on equity markets yesterday, sending both European and US equity markets sharply lower. There were however some scraps of good news salvaged from the day, as UK advance Q3 GDP came in at a better than expected 0.5% QoQ, 0.5% YoY (compared to forecasts of 0.3% QoQ, 0.4% YoY).
Coming into today’s session the performance of major Asian indices has been a little more mixed, with the Nikkei -2.2%, Hang Seng +0.5% and Shanghai Composite +1.4%. The main event coming up will undoubtedly be the latest FOMC meeting, but it is strongly expected that rates will remain unchanged at 0.25%. The most interesting aspects are likely to be the committee’s updates to its quarterly forecasts, and whether there is any notable shift in tone from Bernanke regarding QE3.
Other data coming up includes Norway’s AKU unemployment rate, Eurozone PMI Manufacturing, and the ADP employment change (a crucial leading indicator for Friday’s non-farm payrolls).
By
M.Zohaib Gadit
Forex Trading Consultant
Against this backdrop of Eurozone uncertainty, the uncomfortable demise of MF Global has weighed on equity markets yesterday, sending both European and US equity markets sharply lower. There were however some scraps of good news salvaged from the day, as UK advance Q3 GDP came in at a better than expected 0.5% QoQ, 0.5% YoY (compared to forecasts of 0.3% QoQ, 0.4% YoY).
Coming into today’s session the performance of major Asian indices has been a little more mixed, with the Nikkei -2.2%, Hang Seng +0.5% and Shanghai Composite +1.4%. The main event coming up will undoubtedly be the latest FOMC meeting, but it is strongly expected that rates will remain unchanged at 0.25%. The most interesting aspects are likely to be the committee’s updates to its quarterly forecasts, and whether there is any notable shift in tone from Bernanke regarding QE3.
Other data coming up includes Norway’s AKU unemployment rate, Eurozone PMI Manufacturing, and the ADP employment change (a crucial leading indicator for Friday’s non-farm payrolls).
By
M.Zohaib Gadit
Forex Trading Consultant
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