So the Fed taper fears driving the dull price-action in European financial markets Friday; stocks range bound on the soft side, US dollar winning versus rivals, core government bonds in favour, commodities get a beat down, particularly gold which is off around 19 bucks. Asian markets were downbeat overnight, weighing on the European markets. Reports in the Japanese press that President Obama is set to name Lawrence Summers as next Fed head next week after the FOMC policy meeting. Summers is likely to be for tighter monetary policies so the instant reaction across markets was a US dollar victory and a gold smack down. With no release of major domestic economic data during the day, investors look ahead to the Eurozone Finance Ministers’ meeting, commencing today, to gauge the strength in Eurozone economic growth. Attention also is on US market open for more direction; both the DJIA and S&P indicating a flat open. We have jobless claims and retail sales due soon; two indicators which will undoubtedly be used as gauges to of course get ahead of the Fed next week. As we move closer to the Fed’s meeting, the market is likely to display increase in hesitancy, particularly risk assets. ________________________________________ Ishaq Siddiqi Market Strategist
Posted on: Fri, 13 Sep 2013 11:49:28 +0000