13 July 2012: Stocks end losing streak

Markets– Stocks finally end losing streak, Copper leads commodities rally: Markets are striving to end a 7-day losing streak as Chinese data is in line with the expectations.
•    Stocks: FTSE All World is up 0.3%, as FTSE Eurofirst adds 0.5%; In Asia mood is mildly bullish as FTSE Asia Pacific gained 0.5% and Tokyo’s Nikkei adeed 0.05%; S&P 500 looks set to gain 0.3%, indicating that the gains are tentative at best; FTSE 100 has lost 0.59% to 5671
•    Currencies: Euro nears a two year low at $1.2204 against Dollar; Sterling against dollar is up 0.10% to $1.5445
•    Debt: The German Bunds have lost 3bp to sit at 1.23% while US 10-years are unchanged trading at 1.47%; Spain’s yields stay above 6.75%, while Italy’s are at 6.08%
•    Commodities: Brent Crude is up almost 1% to sit at $102.06/barrel; Copper is up 1.7% today to sit at $3.47/pound; Gold is up 45bps at $1571/ounce

Global Economy
•    China’s growth in Q2 is 7.6%: China’s Q2 growth has fallen to 7.6%, but is in line with most analysts’ expectations. Property market downturns and waning exports have weighed heavily. Following the signs 2-months ago, the government has adopted a ‘pro-growth’ stance, and the economy is expected to pick up to a higher growth rate in Q3 and Q4.

Companies

•    Banks LIBOR costs may hit $22bn: Twelve global banks linked with LIBOR-rate rigging may face penalties amounting to a total of $22bn. The preliminary analysis also shows that 11 more banks besides these may face penalties. The estimated fines would cut the banks’ EPS from anywhere between 4 to 13%.

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