Markets flat-footed ahead of run of economic data
AP and AFPLONDON/HONG KONG--Financial markets were flat-footed Monday ahead of a run of economic data and corporate earnings statements, particularly out of the U.S.
October 22, 2013, 12:06 am TWN
Now that a deal to raise the U.S. debt ceiling has been agreed, investors can move on and focus on other matters, such as the underlying health of the global economy and when the Federal Reserve will start reducing its monetary stimulus.
During the partial U.S. government shutdown of recent weeks, much of the U.S. economic data was postponed. With the government now functioning fully, many of those data reports will be released over the coming days, including September's nonfarm payrolls figures. That's due on Tuesday and could provide investors a steer as to when the Fed will start reducing its US$85 billion-worth of monthly asset purchases.
Until the U.S. debt crisis this month, most investors thought the Fed's so-called “tapering” of its stimulus program would start by December. Many now think it won't start until Janet Yellen takes the chair in early 2013.
In addition, investors will be monitoring the next batch of earnings, particularly out of the U.S. On Monday, quarterly updates from the likes of Halliburton, McDonald's and Netflix are expected to be released.
“In total this week will see almost 30 percent of the S&P 500 reporting figures, more than enough to keep traders busy,” said Alastair McCaig, market analyst at IG.
In Europe, the FTSE 100 index of leading British shares was up 0.2 percent at 6,637 while Germany's DAX fell 0.1 percent to 8,853. The CAC-40 in France was 0.3 percent lower at 4,273.
Wall Street was poised for a flat opening, with both Dow futures and the broader S&P 500 futures 0.1 percent higher.
Asian markets mostly rose on Monday, with sentiment buoyed by last week's deal in Washington to avert a default as well as a record close on Wall Street.
The yen slipped against the dollar and euro in afternoon trading after data showed Japan logged a record 15th consecutive monthly trade deficit.
Tokyo rose 0.91 percent, or 132.03 points, to 14,693.57; Seoul was flat, edging up 0.61 points to 2,053.01; and Sydney advanced 0.57 percent, or 30.3 points, to 5,351.8.