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Market Talk- April 19, 2018

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A solid day for Asia with the broad based rally carrying all markets higher. Confidence gained from strong earnings, better data than US markets had expected and energy prices rallying over 3% all helped to produce a positive day. The Nikkei gave-up the mornings highs and drifted in afternoon trade but still gained +0.15% for the day. The Yen’s weakness returned with values settling around the mid 107’s (+0.2%) for the day. The rise in energy prices helped the Hang Seng with an impressive +1.4% return. In Shanghai the +1.15% added to recent performance was welcomed with many talking the Korea peace talks and optimistic US trade relations is helping to ease concerns. The SENSEX saw yet another repeat of equity performance, currency weaker storey. It does look that we are against month end projections so may have move a little ahead of its self for the short-term.

Unfortunately, Europe failed to follow the euphoria displayed in Asia and so we had to settle for a mixed European close. The DAX was against the heavy index with sellers hitting bids into any rally seen. The index spent almost all of the day in the red and despite a late rally to unchanged, could not hold its place and finished just off the days lows. Volumes have again been quite light, which is starting to concerns some players as it takes such a long time to trade size. The CAC was almost the entire opposite, trading positive for much of the day then closing at its days high. UK’s FTSE managed a +0.2% better close but did see its currency lose ground in late evening trade after Mark Carney the BOE Governor associate rate rises with the BREXIT progress.

Concerns over large Technology companies earnings hit major US firm Apple which prompted a 3% decline hitting the DOW and NASDAQ indices. An early 200 point drop was reclaimed by the close, but still remains a concern for end of week trading. Volumes were again thin and with 10yr Treasuries topping 2.9% had a negative impact on stocks confidence. Phili Fed released better than expected but will be retained until sentiment returns and is accepted.

Japan 0.04%, US 2’s closed 2.43% (u/c), 10’s 2.91% (+4bp), 30’s 3.10% (+4bp), Bunds 0.6% (+7bp), France 0.82% (+8bp), Italy 1.77% (+6bp), Greece 3.99% (+4bp), Turkey 12.25% (-7bp), Portugal 1.63% (+4bp), Spain 1.27% (+7bp), Gilts 1.52% (+11bp). Bonds everywhere tended to drift today and began to see sellers across all sectors. Can only assume the big buyer is full for the moment!