European indices drift lower

Equity markets appear to have little enthusiasm as they await the US open.

Traders appear to have decided to sit on the sidelines as they wait to hear what the Federal Open Market Committee have to say next week. On Wednesday we will find out if tapering will be introduced to quantitative easing in September or not. Certainly the bond markets have fully factored in that it will happen before the end of the year.

Last night the Japanese press was of the belief that Larry Summers will be appointed as a replacement for US Federal Reserve chairman Ben Bernanke, the implication being that he is not as keen on quantitative easing as the current chairman, and would be likely to speed up the process of closing it down. Gold has seen the most aggressive reaction to this development and looked ominously like it was going to fall below $1300 before the buyers crept back in.

Hot on the heels of Royal Mail announcing that they are doing an IPO, Twitter has announced that they have started the process too. They have applied for a US listing and it is expected that they will be valued between $10.5 and $11.5 billion. Although it will not be easy for UK clients to take part in the placing, IG will be creating a grey market in the product to give clients the opportunity of exposure.

 

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.