Financial markets survey 31.03.2014

So far, financial markets cannot return to an upward trend that they demonstrated at the beginning of the current year. Over the last weeks, indices of the leading trading platforms remained mostly flat. The American S&P 500 Index registered very insignificant growth over the first quarter, while the British FTSE Index lost two percent since the beginning of 2014.

It seems that investors cannot decide for themselves whether growth of stock markets will be adequate to sustainable growth of global economy in the environment where there are no large-scale government incentive programs.

Last week, investors shifted their attention from international politics to economic indicators. American indices demonstrated a rather sensitive reaction to the most important macroeconomic indicators of the US published in the course of the previous week. The beginning of the previous week was not bad, since statistical data on durable goods orders in February turned out to be better than expected. However, optimistic moods dispersed quickly, when updated data on the

US GDP in the fourth quarter of 2013 was published. The revised indicator landed at 2.6% and turned out to be worse than analysts forecast, who expected 2.7%. Last week, Citigroup Inc. market value plummeted down. Based on a stress test, the Federal Reserve System did not allow this company to implement its annual plans to pay dividends, referring to inadequate financial sustainability of the company.

If global politics brings no significant surprises, macroeconomic indicators will be the focus of investors’ attention. In particular, investors expect publication of statistical data on the labor market and the real estate sector in the US, as well as several industrial indicators.

Financial markets survey 31.03.2014