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Market watch with Michael Jarman
Michael Jarman has been looking at the trading week and what the markets may bring as we head towards the end of Q1:
"This week markets have generally been quiet but global equities have closed higher. Although light on data there was much to keep traders and investors busy throughout the week as the UK Annual Budget and FOMC Statement were published.
The UK Annual Budget was well delivered with emphasis focused on creating a more robust UK consumer. Insurers were hit on the news that pensioners would no longer have to buy an annuity, freeing investors to do as they please with their retirement savings.
The FOMC declared another $10bln taper and all but signalled that the life support machines will be switched off by September, on the basis that the US economy doesn't deteriorate over that period. US GDP was quietly downgraded which is somewhat startling given the markets expectations for growth this year and investors will have to digest how economic performance will be seen. It's expected that the first interest rate hike could come six months after QE ends, according to the Federal Reserve.
The good news I'm interpreting is that markets will continue to see bad macro data as bad for markets, and good macro data as a sign of strength and therefore good for the markets.
Next week we are light on UK data, but I would caution any investors with exposure to mining to keep an eye on HSBC Flash Manufacturing data from China released in the early hours of Monday morning. Europe is heavy on data in the early part of the week, whilst I also keep an eye on Revised UoM Consumer Sentiment on Friday. I anticipate a fairly subdued week in terms of price action but in terms of risk-on trades, stay on the bid with a weak bias."
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02:42 minutes
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