South Korea: Surprise interest rate cut aims to boost growth
US: Strong data pushes the Dow above 15,000 points
Mexico: Fitch raises credit ratings following legal changes
Dubai: Debt restructuring to bring crisis to an end
Energy: WTI crude drops on high US stockpiles
Property: UK government relaxes rules on office-to-housing conversions
Currencies: Dollar-yen hits four-year high
Global Investments: Yield on junk bonds at historic low
Focus on: Cyclical stocks start to outperform, suggesting more room for market growth
Asia Overnight: Nikkei hits 5½ year high as yen declines
The Nikkei share average surged to a 5½ year high on Friday as the
US dollar broke above the elusive 100-yen mark and extended its
gains, with exporters leading the charge as the Japanese currency’s
new lows looks set to further boost corporate earnings.
Today’s Markets: European shares expected to open mixed
European stocks are expected to open mixed today as a sharp threeweek
rally loses steam, with resource-related stocks set to feel the
pinch of lower oil and metal prices.
UK: Cameron says Britain can change EU
Prime Minister David Cameron took on euro-sceptic critics in his own
party on Thursday, saying he was able to negotiate a better deal with
Brussels and it was wrong to say Britain should leave the European
Union. He described as pessimists those who argue Britain should
leave the bloc and say there is no prospect of reforming the EU. “I
think they are wrong … I think it is possible to change and reform this
organisation,” Cameron told an investment conference.
UK: BoE leaves rates unchanged as the economy grows
Britain’s battered economy could be getting back on its feet at long
last, with glimmers of hope offered by healthier manufacturing
numbers and GDP forecasts yesterday. The economy has shrugged
off fears of a triple-dip recession, jumping 0.8% in the three months to
April according to estimates from the National Institute for Economics
and Social Research. The Bank of England may also think the UK’s
prospects are looking up as it decided against more money printing
yesterday, and kept rates on hold yet again, despite outgoing governor
Sir Mervyn King backing more easing in recent months.
UK: London shares soar to a five-year high on Tuesday
Shares in London soared to another five year high on Tuesday as the
FTSE 100 index played catch up after the May Day bank holiday. The
blue chip index climbed as high as 6,563.35 in the middle of the
afternoon carrying on Friday’s rally after better than expected job
creation figures from the US revealed unemployment fell to 7.5%.
Aside from its recent rally it has not been above since the first week of
China: Trade growth beats expectations
China’s trade growth accelerated in April, beating analyst expectations, a positive sign for the country’s fragile economic
recovery. Exports surged by 14.7% compared with a year earlier. That is up from 10% in March. Imports also rose by
16.8% up from 14.1%. The data meant a trade surplus for China, reversing a surprise deficit in March. However, some
analysts raised questions about the accuracy of the data. “I have no strong conviction whether the data reflects reality,”
said Zhiwei Zhang, chief China economist at Nomura in Hong Kong.
Japan: Nikkei continues its surge Japan’s Nikkei has continued its surge, rising above the 14,000 mark for the first time since June 2008. The benchmark index rose 3.6% to 14,180 on its first day of trading after the Golden Week holiday. Japanese markets have jumped recently after its central bank unveiled aggressive moves, including doubling the money supply, to spur growth. On Tuesday, markets were also reacting to last week’s events, including a rate cut by the European Central Bank. “Stocks must account for a few sessions of most positive activity in overseas markets, which have resulted in a sharply weaker yen, all of which will be tonic for buying,” said Hiroichi Nishi from SMBC Nikko Securities. “Signs that the US economy is improving, as well as the European Central Bank’s rate cut are most encouraging fundamentally.”
South Korea: Surprise interest rate cut aims to boost growth South Korea has cut interest rates in a surprise move aimed at boosting growth and countering a weak Japanese yen. Its central bank, the Bank of Korea, lowered its benchmark rate to 2.5% from 2.25%, the first cut in seven months. South Korean exporters are seeing their price competitiveness suffer after the Japanese government’s recent aggressive policy stance weakened the yen. “This rate cut means that the Bank of Korea admits that the economy is not as good as they think,” said Jun Min-Kyoo from Korean Investment and Securities.
US: Strong data pushes the Dow above 15,000 points The Dow Jones index closed above 15,000 for the first time on Wednesday as strong German factory data pushed US and European share markets higher. The Dow rose 87 points to 15,056. It has been rising rapidly over the past six months, and was boosted by better-than-expected jobs figures last week. Meanwhile, the world’s most famous investor, Warren Buffett, has forecast that despite US indices surging to new highs, there is still more to come. Speaking to CNBC the Berkshire Hathaway boss said: “”You’ll see (stock) numbers a lot higher than this in your lifetime.” Buffett, dubbed the Sage of Omaha, said while he felt stocks are not as cheap as they were just a few years ago, they were “reasonably priced”. He conceded there could be a correction at any time but warned against attempts to time the market.