Thungen Financial 14th July 2014 - Global Central Banks - Week Ahead

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Thungen Financial 14th July 2014 - Global Central Banks - Week Ahead

The global markets ended last week in positive territory ahead of this week's slew of announcements and Central Bank Meetings.

In Japan, the Bank of Japan ends a 2 day meeting on Tuesday which is expected to produce little apart from a slight drop in growth forecasts. The Japanese President, Shinzo Abe has been reluctant to implement excessive stimulus plans as the country fights a mounting social welfare budget and a slowing economy. Recent data has suggested a turnaround however many analysts are concerned that it may be too little too late and that the economy will take much longer to recover.

In China, later today FDI data will be released. Foreign Domestic Investment has been reducing recently and will be eagerly awaited as a good sign to whether the foreign money has started to flow back into China. Wednesday see's the release of key GDP Growth data for the second quarter of 2014. A recent survey see's the figure up 7.4% over 2013 and this will be in line with government expectations of late. At the same time we will see data on Industrial Production and Retail Sales, both key indicators at this time and both are expected to be slightly higher than last year which should buoy the local markets.

Mario Draghi will be speaking at the European Parliament later today ahead of the EU 28 Summit on Wednesday. At the Summit new EC President Jean Claude Juncker will be officially announced on the same day that the Balance of Trade of the Eurozone will be announced. Poor manufacturing data out of the majority of its members will no doubt have a an effect to the data and will be the subject for many conversations in Europe this week.

Quashing speculation that Banco Espirito Santo was subject to its parent companies debts the Portuguese government confirmed that the country's main bank had enough reserves to settle the debts and that its customers had nothing to fear. The Portuguese government has only just exited a bailout program by the EU and IMF and was quick to reassure the public and investors that not government intervention was needed.

In the US the head of the Federal Reserve, Janet Yellen will be in front of the Senate for 2 days of reporting. Last week saw her announce the Fed's intentions to stop their asset buying program by October after a lengthy and expensive QE plan. With interest rates being the main topic of discussion in the US at the moment it is not expected that any news on the rate increase will be forth coming and that mid to late 2015 will be when rates will probably increase. It is a very busy week for economic indicators and earnings reports so it is conceivable that the bull run of late may see a possible slow down should earnings not hit estimates.

Major Global Markets as of 14th July 2014

FTSE 6,690.17 +0.27%          Dax  9,666.34 +0.07%

Dow 16,943.81 +0.17%

Nikkei 15,296.82 +0.88%          Hang Seng 23,344.09 +0.48%

MICEX 1,499.82 +0.33%

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DISCLAIMER  The views, opinions, findings, and conclusions or recommendations expressed on this service are those of the author(s) and do not necessarily reflect the views of the Thungen Financial Advisors. All market data within this release is for your general information and enjoys indicative status only. Thungen Financial Advisors does not accept any responsibility for its accuracy or for any use to which it may be put. All share prices and market indexes delayed at least 15 minutes. 52 week high and low values are calculated from close price data.