FORECASTS for the UK economy will be revised a touch higher in the
Budget on Wednesday, as the Office for Budget Responsibility is expected
to follow recent more optimistic moves by private sector economists.
UK CONSUMERS expect their finances to get worse in the coming year
but are slightly more willing to spend money on major purchases as
worries about job security are easing, a survey showed on Monday.
CREDITORS who have bought insurance-like products to protect them
from a Greek default will receive $2.5bn. Fourteen dealer banks set a
value of 21.5% of par for Greek bonds, which means credit default swaps
will have to pay 78.5 cents on the euro to settle contracts triggered by the
nation’s debt restructuring.
YESTERDAY, the S&P 500 rose 0.4% to trade at 1,410, its highest level in
almost four years, as news of Apple’s plans to pay its first dividend in 17
years provided additional support to the technology sector. The FTSE All-
World equity index rose 0.2% and is at its best level since the start of
June, having rallied almost 13% in 2012. Europe spent most of the session
in the red, as banks and real estate groups weakened. But the firm
showing in New York helped the FTSE Eurofirst 300 pare its losses to
close down just 0.1%.
OVERNIGHT, Asian stocks drifted lower as trading was subdued by an
absence of catalysts and a holiday in Japan, though energy producers
were a bright spot thanks to higher oil prices. Chinese shares were lower with financials and property developers hit by
profit taking after recent gains. Airlines and shipping companies also lost ground after the Chinese government raised
gasoline and diesel prices for the second time in less than six weeks.
TODAY, European equity markets are seen opening slightly lower, continuing to consolidate the previous week’s strong
rally to eight-month highs and looking to US economic data for a fresh catalyst. With investors favouring European
companies that are exposed to US economic growth, US housing data and a testimony by the US Treasury Secretary are
likely to be the highlights of a relatively light events calendar.
THE DOLLAR rose against most major peers after BHP Billiton, the world’s largest mining company, said China’s steel
production is slowing, damping demand for currencies linked to Asian growth. Demand for the euro may be bolstered
before Thursday, as data is predicted to show manufacturing and services growth accelerated in Germany.
SAUDI Arabia is taking steps to cool the overheating global energy market, boosting its exports to the US and re-opening
old oilfields to expand production, as the world’s largest oil producer tries to prevent damage to the global economic
recovery. The Saudi government recently said it aimed to keep oil prices at $100.
RECORD cotton crops from India to Brazil are exceeding demand by the most in more than two decades, driving prices
lower for clothing companies. Gap, the largest US apparel chain, told investors in February it expected lower costs in the
second half of the year.