Brave New World

Market Review 30/03/2009

Market Update– With the almost unfathomable amount of event risk this week markets the great bear market rally of March 2008 is likely to come to an end. Overnight in Asia in markets across most asset classes appetite for risk has been waning. Waning faith in a decisive outcome from the G20 and last night’s news that the US government had denied GM and Chrysler  additional aid following their failure to provide adequate plans to reduce their debt is weighing on investor sentiment. Equity markets in Europe and Asia are lower, with the Hang Seng closing 4.7% lower, the Dax down 3.5% and the FTSE lower 2.3%. Commodity markets have also taken a battering. WTI Crude is down 3.76%, copper is down 2.8%. In the Foreign Exchange markets the biggest winners have been the USD and the JPY, which appears to have regained- for the time being- its safe haven status. The losers have been GBP and the commodity currencies- the AUD and the NZD. 

Data: In the UK house prices fell 0.6%m/m in March, according to Hometrack data. This is the lowest decline since May 2008. Mortgage approvals rose 19% m/m in February. Consumer Credit fell the most since records began in 1993. In the Eurozone, consumer confidence came in at -34, in line with expectations and the lowest on record. Economic confidence was 64.6, a touch less than market expectations. In Japan , industrial production for February was -9.4% m/m, worse than the -9.1% market expectation, making a fall of 38.4% in 12 months.