Member Article

Quiet Markets focus attention on Bob Diamond

After decreasing industrial production in the two global powerhouses (China and the U.S) Global equities and commodities have rallied this week on Investor’s expectation that European Central bankers will use fiscal and monetary stimulus to boost the economic situation. The European Central bank and the Bank of England are planning to meet on Thursday and some analysts are speculating on a cut in interest rate from the former. The euro plunged below $1.26 (-0.3%) around midday ahead of the expected lending rate cut.

Another sign of a further weakness in the economy was UK’s purchasing managers Index (PMI) published today (Wednesday), whose services sector activity index fell to 52.8 in June from 53.3 in May. According to analysts, the decreasing figure could suppose the Bank of England to expand its quantitative easing (QE) programme on Thursday. The Sterling was impacted by concern ahead of the British’ PMI results and dropped as well 0.3 % against the dollar at $1.5638.

On the Brightside, European retail sales unexpectedly rallied in May and increased from -1.4% to 0.6 %. Although Germany’s retail sales fell 0.3% from April, retail sales in France, Spain and Ireland rose 1.2%, and in Portugal retail sales even increased 2.9 %.

The global oil and gas exploration company Tullow Oil plc (TLW.L), headquartered in London, reported an expected revenue record in the first half of 2012. The company said it awaits a return of around $1.15 billion compared to $1.06 billion the year before. Its production increased by 3% to 77,400 barrels a day. Another gainer company today is the construction services company Carillon (LSE: CLLN), trading on the FTSE 100. As private finance projects in Canada increase and its pipeline of potential work had risen from £33 billion to £35 billion in the first six month, the company wants to remain on the track to increase its annual turnover around 1£ billion.

Meanwhile US Stock markets were closed for holiday today; most citizen eyes were on Bob Diamond, grilled by MPs on Barclays Libor scandal Live in London. The former Boss of Barclays confirmed that he only found out about the rate fixing until this Month and it made him feel “physical sick”.

Stock Markets in Europe otherwise were still trading and closed down mostly red. The FTSE 100 were down 3.26 points (-0.06%) at 5684, the French CAC 40 performed slightly worse, finished at 3267 (down 0.11%) and the German DAX declined by 0.20% closed down at 6564.

This was posted in Bdaily's Members' News section by James .