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Events in Canada unsettle a nervous market

Published Thursday, October 23rd, 2014

Global stock indices looked set to add to recent gains yesterday as fears over waning global growth continued to do battle with the support offered to risk assets by hopes of extended central bank largesse. However, the mood turned firmly sour after the shocking events in the Canadian capital, in which a soldier was fatally shot and parliamentary buildings were attacked, weighed on investor sentiment. The release of benign US inflation data which essentially gives the Federal Reserve further scope to keep rates low for the foreseeable future did little to halt the ensuing sell-off which saw the Dow and S&P 500 retreat 0.9% and 0.7% respectively.

Anxieties surrounding the health of the eurozone’s banking sector once again flared up after reports that at least 11 banks across six countries have failed the latest ECB stress tests with results expected this weekend. The announcement of a plan aimed at reversing the currency-bloc’s faltering recovery by the incoming new head of the European Commission was largely shrugged off by the markets. Concerns over slowing growth in China are also set to continue after its latest flash HSBC manufacturing PMI figure revealed industrial output fell to a five-month low although the reading of 50.4 was in line with expectations.

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Posted by Tamas Varga

Tamas Varga has been in the oil industry since 1992 and with PVM for 18 years. During his time in the industry he has gathered a range of experience in the oil markets. At PVM Tamas is in charge of data collection and analysis.