Stock Market Trading: 17 October 2014
European stocks look set to open slightly lower despite a strong reversal of sentiment in the US.
St Louis Fed President James Bullard waded into battle yesterday to recommend that the end of the bond buying programme could be delayed in an effort to reduce decreasing inflation expectations.
The suggestion of further financial first-aid was welcomed by the bruised and battered markets, particularly as it came from one of the Fed's most hawkish members.
Strong US data also made a slight mockery of the sell off.
All of this was music to the bulls' ears, who rushed in to overturn an intraday sell off and helped the Dow close 20 points higher at 16,110.
Despite the positive finish, it was another day on the rollercoaster for spread betting
investors, and the 'teacups' of the summer must seem like a distant memory.
Fortunately, it seems that the volatility index (VIX), a measure of market fear, may have peaked for now.
The bulls will be hoping for a drama free day to end a very turbulent week.
Stock Market Trading: 16 October 2014
European traders are going to wake up with a monumental hangover this morning.
Many of them may rub their eyes before asking the question, 'what on earth happened last night?'
Yesterday really was a complete rout in equity markets and the situation remains very serious indeed.
A one percent move in a major global index is normally considered a large shift, how about a three percent range?
This definitely contains a hint of panicking; the global economic situation simply does not warrant this much of a sell off.
The FTSE is off by 10% in less than a month and, when markets move this fast, traders' blood pressure starts to rise.
Add a potentially disastrous virus into the mix and the result is what we have here, pandemonium in the market place.
We saw a significant drop in US stock markets as retail sales declined by more than forecast in September, with manufacturing in the New York region also sliding.
At one point, the Dow
had fallen by 450 points.
Bargain hunters jumped in during the afternoon session, taking the view that the dive was overdone, and the Dow pared some of the early losses, ultimately closing 'just' 280 points down at 16,088.
Stock Market Trading: 15 October 2014
European equity markets look set to hold onto most of the gains made in yesterday's session.
The FTSE was cautiously optimistic as a flurry of positive data added some much needed arguments to the bullish case.
Weak UK inflation data reaffirmed the logic that accommodative fiscal policy will remain for some time, which supported equities, and earnings in the US came out better than expected.
Even the DAX
managed to claw back some ground, despite the shocking German ZEW economic confidence data which the bulls seem to be wilfully ignoring for now.
Confidence will take some time to be restored, but it does seem that we've hit some support has at these lower levels.
It looked promising in the early part of the US session, as the stronger European lead ensured that a sharp rally enticed bargain hunters back in.
However, a steep sell off in oil prices
quickly spilled over into the energy sector which in turn pushed the Dow lower towards the close.
The reversal turned the gains into more of a dead cat bounce as the index closed just 46 points higher at 13,360 after three days of hefty losses.
There is plenty of data out today for investors to get their chops round, with UK employment headlining this morning.
This afternoon we have US retail sales and PPI data, followed by the Beige Book this evening.
Stock Market Trading: 14 October 2014
European equities look to set to open lower this morning following a flurry of late selling in the US session.
Fresh concerns regarding a slowdown in global growth continued to rattle world markets, sending the Dow Jones 144 points down to a six month low of 16,314.
In addition, Ebola fears are on the rise, with news about the deadly virus making headlines on a daily basis and airline shares starting to plunge.
Having made a decent attempt to rally after a very weak open yesterday, a lot of the gains made by the FTSE
appear to have been lost in the futures markets overnight.
Whilst there is nothing 'brand new' to panic about, investors seem unlikely to dip a toe back in just yet as markets are still too volatile.
Nevertheless, following the recent declines, it is certainly possible that a meaningful buying opportunity will present itself at some point in the next few days.
In today's session, markets will be keeping a keen eye on UK inflation data and the much respected German ZEW survey.
The former should provide further clues regarding the necessity of an interest rate hike from Mark Carney and the BoE, whilst the latter is expected to show that economic sentiment is continuing on a downward trend in the European powerhouse.
Stock Market Trading: 13 October 2014
look set to open sharply lower yet again following a terrible end to US trading on Friday and another lurch lower in Asia overnight.
As the global recovery seems to be becoming increasingly uncertain, particularly in mainland Europe and China, the risk off trade has become worryingly prevalent.
Uncertainty isn't exclusive to growth concerns either; the Ebola risk is completely unquantifiable and has simply given the exodus a turbo charger.
With the economic calendar looking fairly quiet, attention will turn to US earnings this week.
However, don't expect a gentle ride.
With the volatility index at its highest level for nearly two years, this will be an interesting week of tussle between the bulls and the bears.