Summary for the 12th of February 2019


At the US Congress, both the Democrats and Republicans have broken through and approved on a tentative deal. The deal, if passed into law on Friday, would fund the government and avoid another shutdown. The deal involves putting about 1.4 billion dollars toward physical barriers on the US-Mexico border, far below the 5.7 billion dollars demanded by President Trump in wall funds. More important for the financial market though, is the trade talk progression in China.

The investors in the financial market have been waiting for a tangible result of the trade talk. This result might be coming this week. The investors’ expectations seem to be on the optimistic side. The stock markets in Europe ended in a gain yesterday, led by sectors exposed to global trade, like industrial and IT sectors. The stock markets in Asia also ended in positive today.

The British GDP growth eased from 0.6% (quarter to quarter) to 0.2% in the last quarter of 2018, matching the market expectations. The GDP growth in 2018 is thus the lowest level since 2009. The growth in the industrial production and the construction sectors were negative in the last quarter. Business investment continues to fall for the fourth consecutive quarter. The fall in business investment is primarily due to Brexit uncertainty.

Indices on 12th of February:
Dow: -0.2% (11th of February )
S&P 500: +0.1% (11th of February)
Nasdaq: +0.1% (11th of February)
Nikkei: +2.7%  (12th of February)
Chinese indices: +0.9% (12th of February)
STOXX Europe 600 Index: +0.46% (12th of February)

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