Markets make heavy going of gains

Heading into the close, the FTSE 100 is 30 points higher, but markets around the globe are still looking unsteady despite a rare up day. 

Source: Bloomberg

Havens such as the yen and German bunds continue to be in favour with investors, as the morning bounce in European markets fades and US indices struggle to recover from their hefty losses yesterday.

The site of small gains across the board for equity markets marks a decent change of tempo from the unrelenting selling of the past week, but at the moment bullish investors can do little more than impotently shout into the gale of selling that has seen key benchmarks lose ground rapidly.

It’s clear though that investor hesitancy about equities does not extend to company boardrooms, as deal-making from the likes of Zurich, Hikma and GKN continues to dominate the headlines.

Zurich’s decision to  come calling for RSA was, in a sense, inevitable, given the poor share price performance of the UK firm; the euphoric reaction in RSA’s share price seems to indicate investors will welcome a safe harbour within the comforting embrace of the Swiss insurance giant.

US indices posted small gains at the open that have done little to eat into the big falls of the past few sessions. With the Federal Reserve meeting now underway, all eyes are on what Janet Yellen and co will say tomorrow; US dollar weakness persists however, after manufacturing PMI figures from the US inched higher in July.

The US economy might not be sputtering, but nor is it racing ahead, and as a result the 20% surge in the US dollar index over the past year is starting to look a little overexposed. 

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.