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Goldman turns very bearish

Published Tuesday, October 28th, 2014

The recent volatility which has plagued global stock markets showed no sign of abating at the start of another trading week with equities paring earlier gains to end the day lower. European bourses ticked higher in early trading as investors responded positively to the results of the ECB banking sector health checks which saw 25 banks out of 130 failing the central bank’s stress tests. The upbeat mood was shattered when a gauge of German business confidence was seen touching a 22-month low in October and renewed fears that Europe’s power house economy may have slipped back into recession. Adding to the feeling of unease was news that lending to euro-area households and private sector companies continued to shrink in what is a further knock to the region’s growth prospects.

The cautionary outlook made its way onto US indices with Wall St ending the session mostly unchanged following the release of downbeat economic data. Figures revealing that existing home sales rose by a less-than-expected 0.3% in September and a fall to a six-month low in the latest flash services PMI weighed on sentiment. Risk appetite is set to be further undermined as the FOMC meeting gets underway. It is expected to announce the end of its unprecedented programme of asset purchases.

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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.