Markets upbeat on stronger US consumer confidence

Wednesday, March 26, 2014

Global markets rose on stronger than expected US consumer confidence which rose to 82.3 in March from 78.3 the month before. Both the S&P 500 and DJIA posted steady gains adding 0.44% and 0.56% respectively after a two day drop which saw last week’s relief rally pare gains on geopolitical tensions. The VIX pulled back towards 14.00 in a sign that calm was returning to markets, largely driven by the better than expected consumer confidence reading despite new home sales and the Richmond Fed manufacturing index coming in below expectations.

The positive sentiment carried over to the Asian session as Japanese benchmark indices added steady gains on increasing risk appetite. However, mainland Chinese stocks faltered slightly as investors continued to assess the likelihood of stimulus. Despite the uncertain outlook Chinese shares listed in Hong Kong rose to a two week high on the strong US consumer confidence reading and better than expected corporate earnings.

Geopolitical risk concerns seem to be subsiding after President Obama stated yesterday that Western powers would hold off the imposition of further sanctions against Russia provided they do not go beyond Crimea. The allaying concerns have seen the MICEX rally 3% since Monday while the rouble retraced towards the 50 day MA this morning, trading below 35.490 against the dollar. The easing tensions will prompt market participants to switch focus back to the macro picture, with retail sales and consumer sentiment data for Germany and UK Q4 final GDP out this morning as well as durable goods and crude inventory data over in the US expected later today.  

US consumer confidence increased in March after slipping slightly in February

CONCCONF Index Conference Board 2014 03 26 07 14 51 

S&P 500 rallied higher as the VIX dropped towards 14.00

SPX Index SP 500 Index SPVIX 2014 03 26 07 22 18 

RUB strenthens against the dollar as threat of further sanctions subsides

RUB Curncy Russian Ruble SPOT 2014 03 26 07 30 08


Events for today

0700

DE

Mar

GfK Consumer Sentiment

0700

DE

Feb

Retail Sales

0930

UK

Q4

GDP Final

1230

US

Feb

Durable Gds & New Orders

1530

US

w/e

EIA Energy Stocks

All times UK Local Time

 

Topics: GDP, VIX, RUB
More from: Kash Kamal