Technical & Fundamental Oil Reports Specialists

Follow us

The troops are getting restless

Published Friday, May 16th, 2014

There is something not right about the stock markets. Constant record highs for some indices, the highest level for others, but the advances when they come tend to be small. It is as though the muscles holding up the market are running out of lift at the same time as the foundations of confidence are being eroded. I do not think many would be surprised if there was a sudden dash for cover and the whole lot came crashing down.

Yesterday came news that the Eurozone did not grow at a miserly 0.4% in 1Q as expected but at a dreadful 0.2%. France was stagnant, Italy contracted slightly and Holland shrank 1.4%. However, all is well in Germany with 0.8% growth, leading the German Finance Minister to declare that there is no risk of Eurozone deflation. Germany’s quarterly performance is the best for 3-years which Wolfgang Schaeuble hailed as signalling a broad based pick-up. It summarises the Eurozone’s fundamental weakness – monetary and fiscal policy that suits Germany is totally unsuitable for most other members.

There was also inconsistent data from the US. The “Empire State” index which measures New York State manufacturing produced its best performance for 4-years. US jobless claims fell to a 7-year low and US consumer prices posted their largest increase in 10-months. But, US industrial output fell at its fastest rate in 18-months in April, homebuilder sentiment is poor and Wal-Mart reported its lowest quarterly sales growth in five-years.

to read the rest of the report, please click here 

Posted by David Hufton